add dormers to ranch homes power home remodeling master remodelers lakewood split level house additions beach park building onto a ranch house . Chicago Drug testing

Family Business and Conflicts

What is a Family Business?
A family business is basically any business in which the majority of the ownership or control lies within a family. Involvement of members of family in a business can bring with it its own complexities because the line between the business system is sometimes separated by a thin line from the family system. Sometimes these 2 positions overlap causing all sorts of conflicts.

Families involve emotion with includes relationships that carry with it loyalties and natural love whereas a business system is unemotional and coldly designed to extract the highest profit from that venture.

Styles that are necessary in a family situation may not always suit the business situation. Membership of a family is by birth whereas membership of a business should be by investment and performance.

Families deal with family matters in a certain way that entails the head of the family making decisions either alone or in consultation with another senior member of the family. The business however, has its own systems and methods of communication as well as styles involving the resolution of conflicts and finalizing decisions.

Conflict between Business System and Family System
Conflicts arise in family business when the roles of one system intrude into the roles of the other and because each member of the family is basically involved in a dual system problems arise. The overlap of these two systems become really apparent when there are conflicts in interest arising between the family members and the business.

Most families regard the concerns as being paramount in all cases but a prudent business owner will ensure that family concerns and business concerns are properly balanced so as to achieve the maximum satisfaction for both systems and people involved. Too often the emotional bonds of family tend to short cut processes which have been designed to ensure the security of the business and to maximize its success.

For example, family members are put into positions of power where they do not have experience or knowledge simply because they are family members. If they came through the normal interview and selection process they would not get that position. This is clearly a case where family considerations breach the normal standards of how businesses should be run in order to achieve maximum profitability.

Specific Issues in the Family Business
A business is difficult enough to manage at the best of times. A family business however brings with it its own issues and problems and these need to be clear before anyone gets involved in a family business whether that person is part of the family or an outsider. A family business is subject to the same problems that beset every other business except they usually take on an extra one or two, simply because relatives are involved.

Some of the issues that most businesses have to face include the following:

  • Leadership.
    Who is the leader in the business that makes the final decision and how will it appear for the business to move onto the next generation.
  • Family Harmony.
    What needs to be done to ensure that there is harmony in the family.
  • Successors.
    Who will be chosen to succeed and run the family business when the present manager retires or dies? Any family member who is given the responsibility of managing the family business must ensure that sound business and management practices are carried out.
  • Engagement.
    Who should participate in the family business and under what conditions?
  • Passing over the Business.
    What has to be done to allow the entrepreneur to pass over the business to the next family member?
  • Non-family people.
    How are non-family executives and managers to be attracted and retained and what powers do they have to make decisions that may go against the wishes of family members in the business.
  • Compensation.
    Should family members be paid for work which they are not qualified in? And should their salaries be at the same level as non-family members with greater expertise and knowledge in a particular area?
  • Protect Finances.
    Many relatives regard the company as their own personal bank and as a place where they can do whatever they wish. The prudent family 'boss' needs to make decisions, however unpopular he becomes with family members, that will ensure the ongoing protection and financial health of the business.

All the issues above have to be assessed in a family business situation because the potential for business conflict and family stress can be very high. The way to diffuse conflict and eliminate stress involves identifying the issues causing the conflicts and stress and then discussing these issues with all the family members involved.


Copyright 2005 StartRunGrow
http://www.startrungrow.com

StartRunGrow (http://www.startrungrow.com) is a global online information organization that specializes in creating, developing and marketing business help information specifically with the aim of "making business easier" for entrepreneurs around the world. The StartRunGrow objective is to become a dominant player in the business help arena providing end to end solutions for the millions of small and medium businesses worldwide who continue to struggle daily with the difficulties of starting, running and growing a successful business.

In The News:

Franchise Buyers Lying On Forms

The Federal Trade Commission which governs the franchise industry thru... Read More

Loose Lips Sink Ships - The Fastest Way to Put Yourself Out of Business

I agree that knowledge should be free, but the next... Read More

Creating a Paperless Office

When working from home, it is usual to find that... Read More

Electronic Franchise Disclosure and E-Signature Future for Investors

It has been discussed allowing Franchising companies to electronically disclose... Read More

Corporate Shells

A corporate shell could be liken to a house that... Read More

If You Want to Work from Home

Here are some important points to take note of if... Read More

Small Business Publicity -- Worth It?

You bet it's worth it. Publicity via news releases, along... Read More

Small Business Operators - 7 Reasons You Should Change Your Accountant

A recent survey showed that only 28.7% of small business... Read More

Work is a Four Letter Word

I love work, I can watch it all day.I am... Read More

Get Approved for a Franchise

Deciding to start your own franchise is just one of... Read More

Sex Up Your Business Growth

A top executive called up me late in the night.... Read More

Tips For Successful Home Show Businesses

Opportunities for home show businesses have never been more abundant.... Read More

Do You Want Your Own Fully Programmable ERP? - Part 2

In the first article we mentioned the main characteristics that... Read More

Launching your Business with a Chamber of Commerce

Why are Chambers a good launching pad?Chambers provide you with... Read More

How to Profit from a Concrete Roof Tile Business

Concrete Roof Tile Business: During the 2004 summer season, storms... Read More

1-2-3 Steps To A Successful Joint Venture

A successful joint venture marketing effort is the goal of... Read More

Professional Car Care Businesses You Can Start

If you are in the professional car care business you... Read More

Buying a Business

Start thinking about buying an established business if you want... Read More

Using Business Broker In the Franchising Industry for Franchise Sales

Franchising companies often use Business Broker to help attain sales... Read More

Arranging Your Fundraiser

When deciding to host a fundraiser for your company or... Read More

Motorizing for Profit - The Craftsmen Have Left the Building

In the summer, I can't drive two blocks without seeing... Read More

10 Best Practices to Consider as Your SBIR Negotations Approach Contract Signature

10 Best Practices to consider as your SBIR negotiations approach... Read More

Power Tools for Business

How do we keep track of our business deals?If you... Read More

Boston Market; Mobile Auto Detailing

Boston itself covers 50 square miles of concrete and traffic,... Read More

Consistency with Janitorial and Cleaning Businesses

Consistency is a huge word when operating your business. I... Read More

street lights manufacturers benefits of led lights Pete's produce ..
street lights manufacturers benefits of led lights Pete's produce ..