50 Tips: The business of running a family business

Here are 50 actionable tips to boost your family business.

1 to 5: Let it go

• The success mantra for a family business is the ability to compromise. If someone is usurping something, let it go; treat it as an act of a relative, not of an outsider. No one should consider themselves as the smartest of all. 
• All the family members may not be equally efficient and have the same business acumen. But they should neither be alienated nor belittled. Instead, use their talents and move forward.
• Maintain strict financial discipline and plan financial matters diligently.
• The family members must have a clear understanding about the business. One should not have the airs that he knows everything and does not need anyone's help.
• Inculcate a sense of responsibility the new generation, they may be given a fixed amount to run an enterprise or business and prove their ability. They may be told that they can enter the family business only after proving themselves. 

6 to 10: Professionalism

• There are many who want professionalism in the organization. But they are not willing to hire professionals and give them a free hand. This may be due to the false belief of losing control of the business. But such institutions may not be competitive enough in the modern age and fall behind. It is not enough to hire professionals; they should also be given freedom to act. Only then can one ensure professionalism within the organisation. 
• Group discussions and travelling together whenever possible will make the relationship between families warmer. It will also reflect positively in the business.
• The business will start collapsing if anyone in the family harbours thoughts of acquiring more wealth than others. If one sets out on such a conquest, it will damage relationships, hurt one's reputation and impact the business adversely.
• Family members should have a clear understanding about the growth of the business. And they should prepare themselves for that. There should not be any lack of clarity about how to move forward once you reach a particular stage of growth.
• Running a family business is often complex. So, take part in seminars and training programs related to it.

11 to 15: Nurture the new generation

• It should never cross the minds of the new generation that they can do business independently only after the doyen of the business family is no more. So, give space to their thoughts and ideas in the running of the business.
• There is no need to hide the sufferings of the predecessors from the younger generation. Let them know the efforts the predecessors had put into each step. Make them understand the effort it took for every step. This will instil a sense of responsibility in them while carrying forward the enterprise built with the blood and sweat of the predecessors. 
• Many family businesses rise from scratch through teamwork, only to crumble after a split. This tragedy can be prevented by setting ambitious goals for the business, extending beyond short-term gains. To achieve this, establishing a clear succession plan and a professional management style is crucial.
• The leaders should exercise moderation and self-restraint when trying to correct the younger generation. Their self-esteem should not be hurt. Strict policy interventions should be followed in this regard. 
• Those who have built family businesses can sometimes be averse to change. But do not air your differences of opinion with them on public platforms. What is really required is tactful intervention. Be respectful of their efforts while convincing them that such changes are necessary to succeed in the future. 

16 to 20: Maintain warm relationships

• Members should respect each other and seek everyone's opinions. Make them feel that your decisions are theirs too.
• If everyone starts doing everything, nothing will happen. If someone does something on top of what another one had done, it can lead to ego clashes. Tasks should be divided and allotted according to each one’s skills and interests. 
• There should be formal meetings in which everyone participates. Everyone should speak like professionals there. But formal gatherings are not enough to maintain warm relationships. Occasional outings are also needed. 
• The new generation should be brought up in accordance with the values that the group believes in. Parents should make them understand the sanctity of relationships as they are the ones who will lead the group tomorrow.
• Everyone must feel that he is doing the least amount of work in the organization. 

21 to 25: Need for bonding

• Efforts should be made to make the employees feel that they are one of the owners of the organization and a member of the family.
• Do not encourage it when someone speaks bad of a member of the family business. It is those who are trying to create a rift in the family and exploit the situation that spread canard.
• If the business enterprise incurs any financial liability, settle it immediately even if you need to sell some property for that. Never let that liability linger on.
• The fellowship among the members must be passed on from one generation to the other. If there is any disparity in the lifestyle or education, it can harm the bonding. Take care and see to it that it does not happen.
• Do not unnecessarily interfere in others’ work. The path that people choose for achieving a goal will vary from one to another.

26 to 30: A role for all

• Want to bring your children into the family business? Then it is better to train them from an early age. But do not impose anything on them. They may float ideas that will help the group to diversify. So do not nip their creativity in the bud. If their interest is to become top professionals, let them be.
• Personal and family issues should remain separate from business matters. Likewise, disagreements within the business should not affect personal relationships.
• Give the new generation good training instead of fast tracking them into leadership roles. Individuals who have gained experience at lower levels often develop the skills needed to successfully lead a company through challenges. 
• Everyone must realise that what one thinks need not be right always. Accept the views of others too.
• Efforts should be made to bring out the latent abilities of others. Then only will the group succeed. 

31 to 35: Keeping the flock together

• Leaders should leave the day-to-day affairs of the group to top professionals. Remember that the leaders have greater things to accomplish.
• If anyone has any concern or complaint, the team leader should strive to bring it out in the open. If it is not possible to do it on one’s own, do an annual review with the help of a consulting agency.
• When someone becomes part of the family through a marriage alliance, it is better to give them fresh responsibilities rather than involving them in the existing business. The practices followed in a smoothly running business may not appear to be right to those from another family background and culture.
• Be careful about giving a crucial role to the spouses in a business run by siblings. Siblings may have differences of opinion. But they get sorted out fast. But it may not be so among those who come from different family backgrounds. 
• If a difference of opinion crops up in a business where the children and their spouses are active, it is better to let them settle it on their own. Neither their father of nor the mother should intervene and try to do anything for or against one of them.

36 to 40: Divide responsibilities 

• Once a person who started a business and watched it grow big hands over its reins to his children, only after they can stand on their own legs should he intervene creatively in it.
• If you feel that the company is not on the right trajectory, you should try to correct or advise your children only after thinking deeply through it and convincing yourself that the hunch is correct. Sometimes what is right for you is not what is right for your children.
• Everyone yearns for recognition. A person who brings his children into the business at an early age must accept their innovative ideas, even if they may not appear to be the right ones and give them the opportunity to try them out and get convinced themselves. 
• In case the business needs to be divided among the children, instead of taking a unilateral decision, the father can ask the children to collectively give him a plan on how to go about it.
• Disagreement among family members should not in any way affect the day-to-day business of professionally run organizations. No director should give any instruction to the officers of the company that they should not do anything without consulting him.

41 to 45: Importance of teamwork

• If the business has been entrusted to a family member, his word should be final as far as the organisation is concerned. 
• If you want to question the person running the family business, do so only in an appropriate forum. If you feel that his actions are not right, try to correct him in family meetings. And if it does not work, remove him from the leadership. His supremacy should not be questioned as long as he is at the helm of affairs.
• In case spouses are running a business together, avoid bringing business matters home. The responsibilities of both should be clearly defined. Avoid interfering with each other, if possible. Employees should not face a situation where they must satisfy both to get something done.
• The cornerstone of a successful family business is teamwork. It is the responsibility of the person leading the business to ensure cohesion.
• Each family member should have a clear vision of the road ahead for the business and where it must reach.

46 to 50: Decorum is key to unity

• Members should feel free to express their ideas and opinions. Only then will healthy discussions flourish.
• Before the new generation is inducted into the business it will be great if they have the experience of working under someone in another organisation.
• Staying united is the best way for business growth. However, everyone in the family must have the opportunity to develop. When the new generations come into the business, they will have many fresh ideas. If they cannot be implemented it is better to divide the business and give everyone a chance to grow.
• If the business is big enough and offers everyone space to work, continue the business, keeping the flock together. As the group grows, everyone’s stake can be divided into shares. Let professionals manage the business. 
• Even if you part ways in business, maintain the relationships. If that is not possible, avoid pointing fingers in public. There can be competition in business. But there should be no room for personal rivalry.

    (This was earlier published in the 35th anniversary edition of Dhanam Business Magazine)