A number of privately owned manufacturing businesses in the U.S. have more than one family member on the payroll. That’s not surprising when you consider that many people who start or buy a business do so for the good of their family.
However, working with family members presents unique challenges that, if not addressed, can lead to poor employee morale, limited growth and, potentially, failure. Following are 7 important steps smart family businesses take to head off these problems.
Decisions are made in the best interests of the company. This seems obvious, but it can be difficult to stand up to a family member who places short-term personal gain above the long-term health of the company. You owe it to all of your employees to do what’s best for everyone’s future.
Promotions are based on merit, not relationships. The best person for a job may not be a family member or a friend. When employees see less qualified family and friends advancing in the company, the outcome is never good. Your best people may leave or harbor resentments, and that can erode the quality of their work and affect overall morale.
Company leaders seek objective advice. If family members are skilled and experienced in various aspects of the business, it would be foolish not to listen to them. However, beware of suggestions from well-intentioned but ill-equipped family members. You need input from the most qualified employees and objective advisors before making important decisions.
The next generation has choices. Some family business owners expect their children, or other family members to eventually take over the company. This raises two important questions: “Are they qualified?’ and “Do they really want to work here?” It pays to be open to the possibility that the answer to one or both questions may be “No!” Assuming they are qualified and choose join the business, it’s important they understand that they will be treated like any other employee, judged on the same standards and expected to respect the chain of command.
Succession plans are transparent. If more than one family member or non-family member aspires to one day lead the company, it’s only fair to make your choice as soon as practical, and make it known to everyone in the organization. Whether or not your successor is a family member, all of your employees need to understand what the future looks like.
Roles and responsibilities are clearly defined. If a family member is on the payroll, but the employees don’t know what they do, they will assume that the family member is getting a free ride.
Hiring practices are objective. Your goal is to always hire the best person for a job. To do so requires measuring all candidates by the same criteria, whether they are family, friends or complete unknowns.
Gosiger is a successful family owned and operated business, now in its fourth generation of serving the manufacturing community. Let us put our more than 95 years of production technology experience to work for you. Contact your local Gosiger facility to learn more.