Although a little healthy competition can help to build a business, the opposite can result when the company is a family affair. Family businesses often include multiple family members. Whether siblings, children, grandchildren, or other extended members, these individuals work together to build the family legacy. Professional competition within this arena can lead to severe problems.
Why? One key reason: the one who looses is unlikely to leave. One of the great things about family businesses is the retention rate. Generally, the workers stick with the company. As a result, if you have a culture of competition, the person who looses is unlikely to leave. This is very different than in other businesses. In other businesses, the loser would likely leave and look for opportunities elsewhere.
Four Tips For Success
Instead of depending on internal, professional competition, family businesses can better ensure success with these four tips:
- Help candidates prepare for leadership roles by developing their leadership skills. Formal classwork and podcasts can help, as can the opportunity to take the lead on projects within the business. It can also help to encourage young members of the family to work in other markets before coming back to the family business. They could develop a skillset through this experience that will help bring some diversity and new ideas to the family business.
- It can be helpful to have a family council to handle non-business issues. As noted in a recent piece in Forbes, this group can help to ensure better everyone connected to the business within the family is on the same page about the business’ plan.
- The importance of honesty cannot be overstressed. Have a transparent process for how the next leader of the business is chosen. If non-family members are a part of the business, it is important to have transparent expectations and hold everyone to the same standards.
These tips are just the start, but they can help you to build a business succession plan to help your family’s legacy continue for future generations.