How To Run A Successful Family Business | Family Firm Research Institute data indicates that family businesses account for 80% of all enterprises in the United States, creating about 60% of the nation’s employment. Indeed, some of the biggest companies in America and worldwide, like Wal-Mart and Ford, are family-owned businesses. Therefore, these companies have the potential to blossom if you run them properly.
However, running a successful family business is easier said than done. The endeavor can quickly become a source of family feuds and wounded egos within a short time if mismanaged. Therefore, it’s essential to know how to run a thriving family business that you can pass down for generations. Here are some tips to help you run a successful family business.
Always treat it like a business.
Many family businesses place too much emphasis on the “family” aspect of the enterprise instead of the “business” aspect. Several business experts consider this one of the significant flaws of family-operated brands and one of the leading reasons they fail. Consequently, understand that your family company is fundamentally a business and run it as such. Therefore, you might need to sacrifice family harmony for the sake of the business at crucial times, no matter how hard it seems. In addition, you’ll need to stay on top of everything necessary to make an enterprise prosper, from finances to security. Protecting your business premises is undoubtedly vital to ensure that you don’t get robbed or attacked in any way. Trusted providers of corporate security tools can handle these concerns.
LifeRaft‘s Navigator platform is a corporate security tool that strengthens company security by identifying, assessing, and validating possible threats to your enterprise’s property, operations, and staff. The platform monitors numerous open sources, including blogs, the deep and dark web, chat boards, and social media, to identify any information relevant to your organization and its operations. Then, LifeRaft’s product fishes out any threatening posts like a planned employee kidnapping or bomb threat and alerts your company in real time so your team can prepare and respond adequately to these events.
Also, organizations can change push notifications from this software to receive relevant alerts that suit their personal preferences. This way, you can get real-time alerts concerning threats to your executives, trespassing, and even emerging events that could jeopardize corporate safety. What’s more, Navigator uses industry-leading analytics to investigate smarter and more affordably.
Decision-making in a family-run company can be restricted and devoid of any creative thinking or fresh ideas. As such, consider seeking ideas and guidance from external advisors who aren’t associated with any family member. This way, you can receive much-needed reality checks and new ideas. Many current business owners of family enterprises, like Zach Mottl, appreciate the essence of outside perspectives to internal decision-making. Mr. Mottl is the Chief Alignment Officer of Atlas Tool Works Inc., based in Lyons, Illinois. Zach serves on Burr Ridge’s Economic Development Committee and continues advocating for the value and essence of domestic manufacturing in any healthy national economic model.
Create a succession plan.
The whole idea behind a family business is a lasting legacy for future generations, so it’s crucial to create a succession plan to transition to the next generation as smoothly as possible. This succession plan should have all the details of how you’re working and when you’ll pass down the family enterprise to the younger generation. You can also include a sound financial plan for the organization, set a retirement date, develop a timetable for training new management, and outline the possible roles the founders will continue playing after handing over.
To conclude, establishing a family business is an excellent way to leave a lasting financial legacy for future generations. The points above are some useful tips you can leverage to run your family-owned enterprise successfully.