Avoiding Family Business Turmoil | How-to Guides for running you... http://www.work.com/Avoiding-Family-Business-Turmoil-273/ Browse All Guides Suggest a Guide Write a Guide Search My Work.com Log Out Home > Management > Management Strategies > Avoiding Family Business Turmoil Guide to Avoiding Family Business Turmoil Strategies for keeping the peace in a family business By Frances Sharpe Every family has its share of issues. Combine the emotional elements of family relationships with the demands of running a business and it's no surprise that turmoil is a common outcome in family businesses. However, with the right approach, you can help keep your family business free from explosive situations. A well-managed family business boasts numerous benefits, including: 1. Decreased start-up costs. 2. Potential tax savings. 3. Employee loyalty. Supremely Useful 9.7 out of 10 Rate This Guide Add Your Comments 4. A shared vision. 5. A long-term commitment to success. Action Steps The best contacts and resources to help you get it done Outline job qualifications and requirements Giving a family member a job simply because they're a relative is sure to create problems within your organization. Without proper qualifications, family employees are doomed to fail, creating tension and frustration. Avoid trouble by insisting that family members be qualified for their jobs with the proper education, training and experience. And hold them accountable for their job performance. I recommend: The Job Results Management Institute provides forms that can help you pinpoint job qualifications, conduct performance reviews and measure performance. Find performance measurement resources from the Zigon Performance Group. Related Guides Guide to Business Buy-Sell Agreements Guide to Business Loans from Family & Friends Guide to Creating an Estate Plan for Your Business Guide to Establishing Internal Financial Controls Guide to Free Small Business Counseling Define roles Snuff turmoil by giving family workers clearly defined roles within the company. By outlining the specific parameters of each person's job, your family employees will understand the scope of their responsibilities and will be less likely to tread on each other's toes. I recommend: SBA.gov provides tips on how to write a great job description. Get a look at some common duties included in various job descriptions in Monster.com's job profiles. Compensate fairly Just because someone is family doesn't mean they should be paid an exorbitant salary. This can lead to tension among the ranks of your non-family employees. I recommend: Use Salary.com's free Salary Wizard to find average salaries, including bonuses, for dozens of job categories. Job valuation reports that give you a complete look at salaries, bonuses and raises for a variety of positions are also available for a fee from Salary.com. Schedule family meetings and retreats To make sure that all family members are on the same page in terms of business strategies, operations and future plans, hold regular family meetings. Consider an annual retreat to encourage family bonding, which plays an important role in the ongoing success of a family firm. I recommend: The Family Business Consulting Group, authors of Family Meetings: How to Build a Stronger Family and a Stronger Business, offers family business meeting resources to ensure that you get the most out of your meetings. Select an advisor or consultant Since family enterprises face unique challenges, it may be beneficial to hire a family business expert as an advisor or consultant. Outside advisors can assist you in making sound business decisions while taking into account the emotions and personal relationships involved in a family endeavor. I recommend: The Family Business Consulting Group outlines the benefits of working with a consultant. Review questions to ask a potential advisor at the Family Firm Institute, which also offers links to consultants who specialize in a host of family business topics. Guide to Operating a Successful Family Business Guide to Planning an Exit Strategy Guide to Succession Planning Guide to Working Well with Partners Browse All Related Topics Accounting Business Advisors Business Contracts Business Financing Business Taxes Create a succession plan A succession plan can help ensure the smooth transition of your business to the next generation. By choosing a successor and communicating your succession plans with all family workers, you can avoid power struggles. I recommend: SuccessFactors.com offers success management software and succession planning Webinars. Familiarize yourself with the documents necessary for transferring the business, such as buy-sell agreements. Tips & Tactics 1 of 3 Closing a Business Family Business Management Strategies Strategic Planning Team Building 11/1/06 5:05 PM Avoiding Family Business Turmoil | How-to Guides for running you... http://www.work.com/Avoiding-Family-Business-Turmoil-273/ Browse All Helpful advice for making the most of this Guide In spite of your efforts to keep the peace, conflicts may arise. Your best bet is to deal with them head on rather than hope they go away on their own. Encourage family members to keep business and personal lives separate. Featured Vendors Bonuses and incentives should only be given if predetermined objectives are met. Non-family members performing the same work as family members should be paid equally. Provide opportunities for advancement for non-family employees to avoid frustration and improve employee retention. Red Rock Corporate Solutions: Family-Owned Business Consults Recommended Solution Providers Back to top IMD: Family Business Center Helps family-owned businesses with financial planning, business plans, tax consulting, estate planning and general legal consulting. www.redrockcorporatesolutions.com Lycos: Business Cards Offers programs on family business issues like governance, transition and relationships. Find business cards and more at Lycos Search. No clutter, just answers. Lycos - Go Get It! www.lycos.com Mediate.com: Conflict Solutions Conflict solution assistance for family businesses. Metropolitan Group: Relative Solutions Consultant group offering help with challenges and dilemmas of families who share business assets. Family Business Management Services Consulting service for family businesses and farms. Thomas D. Davidow & Associates Consultant firm offering management assistance to family businesses, foundations and offices. Best Sites to Learn More Back to top Microsoft: Small Business Employee Relations Collection of tips on employee relations for small business. Includes advice for family business. Entrepreneur.com: Family Business Family business resource center offering management articles and tips. UMass Family Business Center: Articles Educational resource site for family business wisdom and advice. Blackwell Publishing: Family Business Review News and research papers on the dynamics of the family firm. Biz Journals: Family Business Advice Extensive collection of advice from James Lea, a family business author and speaker. UNH Center for Family Business: Articles Offers articles and resources for family business success. Business Link: Family Run Businesses Covers family business issues like compensation, succession and conflict management. Online Organizing: Working With Family Articles and tips for running a healthy family business. Family Business Magazine: Guide for Family Companies This is the official site of Family Magazine, which strives to helpd family business owners make informed decisions about managing their own businesses and families. Best Blogs and Forums Back to top Family Business Blog Success stories, profiles and management advice for family owned businesses. Comments Back to top Add Your Comments 2 of 3 11/1/06 5:05 PM Avoiding Family Business Turmoil | How-to Guides for running you... http://www.work.com/Avoiding-Family-Business-Turmoil-273/ The most successful family businesses I know require members of the succeeding generation to work elsewhere before taking their place in the family business. When kids earn their chops on unfamiliar territory, they gain confidence from knowing that they can succeed independently, they bring new ideas back to the family business, and they gain the respect of employees who may otherwise be resentful of junior's entitlement to a job. Posted by: Donna Fenn 09/28/2006 05:53 AM Add Your Comments Is any content on this page inappropriate? To let us know, please click here. © 2006 Work.com, Inc. All Rights Reserved. Work.com is a property of Business.com. Help | About Us | Site Map | Terms of Use | Privacy Policy | Community Policy | Community Blog | Advertise on Work.com | Contact Us / Feedback 3 of 3 11/1/06 5:05 PM