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Thread: How to separate family from business

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    How to separate family from business

    EMPLOYEE relations in your business is one of the hardest things for a business owner to get right, but it becomes even trickier if family members also join your team.

    Those employees that are non-family members might not be too pleased if you bring family into the business. Especially if you remunerate family members better and promote them up to management quicker than non-family members. But there are ways around this.

    Tony Balshaw, partner in Grant Thornton’s family-controlled company, says family-owned businesses need to create a distinction between family and management by drawing up clear policies.

    He says employees will need to except that a business owner’s family members will always be favoured, but he also feels that business owners should strive to do what’s in the business’ best interest. “The best thing is to have a family creed and to share this with the family,” explains Balshaw.

    He says the creed should contain things such as how family members and senior management are paid out.

    Managers should be aware what your business’ policy is when it comes to promoting family members, he says.

    Forming a family shareholder’s committee where family members can meet to discuss issues around the business, remuneration and promotions of family members, is another alternative.

    He says if you award a family member a bonus, but don’t grant your other employees the same, you’ll be setting a bad president.

    Similarly, you shouldn’t finance a family’s vehicle through the business even if it turns out to be the most affordable alternative. This may, again, send out the wrong message.

    Dennis Venter, managing director of family-run business XLNT Panelbeater, says he has never experienced problems between family and non-family members in his business.

    “We run this company as a family,” says Venter, who manages the four-year old business with his wife, his daughter and three sons. Five of his managers are non-family members.

    He says part of the reason he pulled out of his previous business, which he ran with his brothers, was because of clashes between family members and non-family members.

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    Site Caretaker Dave A's Avatar
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    This is an area where I have a fair amount of experience.

    Having clear expectations in place is common to so many aspects of business, it perhaps doesn't bear repeating here. It's important - period.

    What I think deserves special attention is the family business brings two environments into play, and they really do need to be treated differently.

    At work.
    Treat family members the same as the rest of the staff. If you find you are treating family members on staff better than non-family members, raise your game in terms of how you treat non-family members of staff. If you are treating family members worse than other staff - you'll need to look at that and make some changes too.

    At home.
    Lose the business relationship completely. Become the husband, wife, brother, sister, father, mother, daughter, son (I trust you get the idea by now) and deal with business discussion accordingly. It's too much to expect to stop discussion about business at home or at family gatherings completely. But don't turn family time into a business meeting.

    Do this consistently and you'll find the discussion at home about business becomes anecdotal, and the business gets done where it should be done, at work.
    Last edited by Dave A; 01-Nov-09 at 11:18 AM.
    The trouble with opportunity is it normally comes dressed up as work.

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    Platinum Member sterne.law@gmail.com's Avatar
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    My wife and I both practice Labour Law seperately. We naturally run ideas, tactics etc by each other. We however made a rule that only certain nights of the week is it allowed and between a certain time, as if we were in a meeting. That way we keep it limited.

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    Advice

    I don't think it's make any difference to your business if you are working with family members.

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    In SA it makes a major difference especially with our unique labour laws. Its classified as nepotism. You will never have a situation where you will be able to treat your wife as equal to the employees and then go home and expect her to treat you equal in your marriage. Family members become disgruntled when they are not paid properly. You tend to be more lax on family members and then you, as an employer, become disgruntled when they take advantage of certain leniences. I could go on forever. Its definitely unwise to work with a family member.

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    Site Caretaker Dave A's Avatar
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    Quote Originally Posted by BBBEE_CompSpec View Post
    Its definitely unwise to work with a family member.
    There was a time when I felt that way. But not anymore.

    I think when you grind away to the root of problems that can and do occur with this, the enemy is any sense of entitlement. And that applies even to the leader.

    If the leader applies the principles of leadership by permission rather than leadership by position, lots of things fall into place. The philosophy permeates the working environment. People start to understand how they get ahead in this organisation. You may have been given a place to start, but you earn where you end up. And that's up to you.
    The trouble with opportunity is it normally comes dressed up as work.

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    Dave, you are one in a handful that has adopted the separation route. Many husbands/wives haven't and their businesses are struggling today. I am seeing this especially as the breadwinner loses their jobs and the spouse takes them in feeling more remorse that the expertise of running their business more professionally.
    Last edited by BBBEE_CompSpec; 11-Nov-09 at 09:35 AM. Reason: spelling

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    Platinum Member Marq's Avatar
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    I have run my business's with my wife for the past 10 years and it works because I'm the boss and I have her permission to tell you this.

    It seems though that it works because we have split the responsibilities and try not to run each others area of expertise. Advise and thoughts are given but it is that direct involvement where one must be careful not to tread. Get that right and as said, it has worked for us.

    But this is as far as family and friends involvement that I want to go. I have told mates many a time that I would rather be friends than business partners. Too many friendships dissolve due to schemes that have had one cook too many in the kitchen. Same for the kids - they must get and do their thing, get some worldly experience and I will support from the distance rather than see them every day. One day when I have grown up, I may let them join me in some adventure, but for now........
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    Platinum Member SilverNodashi's Avatar
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    My wife recently started working with me, and it's going great. Some time ago we tried to work together as well, but had many fights about it, and never "left business at work", so to speak. She then went on to work for other companies, but after some time discovered a hidden talent for web design, since she's an artist & photographer this came almost naturally to her.

    But, to seperate the two, we don't mix business with family time. When we go home, or away on holiday - we leave work / the business behind. I don't treast her any more special than I would with our contractors, and we do quite well. The business has grown quite a bit since her joining, and she has a "profile", i.e. she does only that which she has to. So she doesn't need to worry about the stuff I, or our other developers does and that helps a lot as well.
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