It is often said that success doesn’t just happen; you must make it happen if indeed you desire it. If your desire is to run a successful family business and leave a lasting legacy for your family, you must be deliberate about it. If you research about family businesses that grew from the scratch to becoming a business empire, you would realize that the founders have certain attributes that are common and they ensure that they put all that is needed to build the business to that level.
A successful family business is any business that involves the participation of all stake holders (family members). It could be active or passive participation, but the major decision making and key areas in the running of the business are done by family members. As a matter of fact, the bulk of the shares of the company are reserved for only the family members.
If indeed you want to run a successful family business, these 10 golden rules for running a successful family business will help you.
10 Golden Rules for Running a Successful Family Business
The most important thing to start within your quest of building a successful family business is to choose the right kind of business to do. There are some businesses that from mere projections, you are able to figure if it might be capable of surviving beyond a season or a period. For example the introduction of digital photography made companies like Kodak and others to go into extinction, and also the introduction of computers made companies that were into the production and servicing of Typewriters to go into extinction. So if you want to build a successful family business, make sure you choose a business that can survive the test of time and the advancement of technology.
Crafting a clear cut vision statement for your family business and ensuring that your family members and all your employees buy into it is the basic foundation you need to be able to build a successful family business. Just make sure the vision is not just written and placed in strategic places in your office, but let it be in the heart of all your family members and employees alike.
As the founder and leader of your family business, you should work together with your family member to set a common goal for your family business if indeed you want it to succeed. Just ensure that the goal you set is easy to understand and interpret. For instance, you could set a goal to become the leading player in your line of business, or to build a multi million dollars business dynasty in the next 20 years. The rule of thumb here is to set a goal that is measurable, achievable, and realistic and time based.
One of the major challenges of building a successful family business is lack of discipline. You would realize that when discipline is not enforced at the early stage of building a family business, the family members that are involved in the day to day running of the business tend to handle assigned tasks with levity because they know that they could be fired. As the leader of your family business, when any of your staff including your family members breach company’s’ policies or display any form of indiscipline, if you have to issue them a query, suspension or even a termination of their appointment, do it.
The acronym TEAM (Together Everyone Achieves More) truly fits into the basic requirement for building a successful family business. The fact that it is a family business means that you as the leader mightn’t be the only one calling the shots; you would require the input of other members of your of your family. Ensure and encourage any activity that will promote team spirit in your family business.
6. Never Compromise Excellence
If indeed you want to build a successful family business, you should never compromise excellence at any stage of your business. Excellence in terms of services and products is what will keep your family business growing. People are always willing to pay premium for excellence, so whatever line of business you are involved in, please make sure it is a business that produces quality products and renders quality services.
7. Insist on Accountability
Since you might be working basically with your family members in running your business, make it clear that everybody including you as the head of the business is expected to be accountable to the whole team. Nobody should be expected to do things and just get away with it.
The dynamics of running businesses keeps evolving with time and it takes a person that invest in training and re-training to be able to catch-up. If you desire to run a successful family business, then you should be willing to spend money in training and educating your employees and family members.
Let it be clear from the beginning that a certain percentage of the profit you make from your business monthly is saved. If you do this, you will be able to prepare the mind of your family members to know the limit of financial request they could make. Enforcing saving culture in your family business positions your family to cash in on other investment opportunities when they come.
Truly a successful family business is a business that can be positioned in such a way that the leadership of the business can be passed across from one generation to another. You will need to adopt an effective succession plan so as to be able to pass across the leadership of your business to your children and then from your children to your grandchildren; that is the hallmark of a successful family business.
The 10 golden rules discussed above would help any serious minded person to build a successful family business that would be worth emulating. Please note that successful family businesses that have stood the test of time went through these steps. You too must be prepared to do same and even more in order to build a great family empire.