The successes and challenges of family owned businesses.
Updated: Mar 2, 2022
Family businesses can be highly successful. Their cohesiveness and ability to make fast decisions helps determine this success.
As many as 70 percent of Australian businesses are family owned  . The hospitality industry is well known for its family restaurants, cafes and establishments.
Who better to trust when it comes to your bread and butter than your own kin. A 2016 survey of family businesses found they possessed some advantages. One key strength was the ability to make quick decisions. Family businesses also do well in the long term. Some 49% of family businesses have been around for between 20 and 49 years.
At the same time there appears to be no shortage of stories of where family business have gone awry.
So, what works and what doesn’t? Here are some suggestions for family businesses:
Employing some staff from outside of the family might be beneficial. Another pair of eyes in certain positions may provide more less biases decision making. This can help keep to ensure everyone is performing their rostered responsibilities. Good delegation can help management and create more space in the calendar for family.
Be clear on the rules:
A 2015 survey found that only 28% of family businesses had a code of conduct, family charter or constitution . It’s important to keep professionalism between your family when you are at work. Make sure to sit down and clearly define each family member’s role and responsibility.
If a conflict is going to occur. Keep family issues away from suppliers and customers. Left unchecked, this could be especially damaging to your business brand and reputation.
Take time out to be a family
Time is a precious resource; remember at the end of the day you are still family. What you do when you get home matters for family and for the health of your business. A key source of conflict is the “Balancing the needs of the family vs. the needs of the business” .
Some hospitality businesses have to stay open late and through the weekend. These long hours can leave little room for holidays, outings and time around the dinner table. It may not be possible to have the whole family off work together for one day a week. An alternative might be to alternate taking time off together to catch up for coffee or other activity.
As with any business, good communication is essential. Using clear, direct communication is important in a family business. This applies especially when discussing family work performance or applying discipline.
Plan for the Future:
What is your succession plan? In 2016 only 51% of family businesses had a succession plan. Who will take over each responsibility? Do you want to continue the family business? These questions are worth considering when planning the future of the family business.
In summary, family businesses can be high performing and successful. Their cohesiveness and ability to make fast decisions helps determine this success. There are also some challenges. Most challenges center around maintaining work and family life balance. Overcoming these challenges requires the ability to create space. Establish clear rules and responsibilities. Schedule family time outside of work (if possible). Keep vocal with good communication. Finally, prepare for the future and establish some form of a succession plan.
Check out more of our business related tips. Head to our Business Blog https://www.goroster.com/category/business/ .