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Peer Group Diary: A face-to-face meeting in Calgary looks into the challenges of running a family business

"In a family business, humility helps"


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October 24, 2019 by Robert Koci

OCTOBER 19, 2019:

Part of my work with Canadian Contractor is to facilitate¬† contractor peer groups. Seven renovation and custom home building contractors from across the country meet twice a year face-to-face and twice in a conference call to share their insights, concerns and successes with one another in an effort help each other build better businesses. I spent three days in Calgary last week at one of the face-to-face events. I’ll share some insights we gleaned from the group over the next few weeks.

There are four contractors in our peer group that run family businesses. The challenge of managing family members you can’t fire and yet have a big impact the work culture is significant. To make it work, it takes the bifurcation of the leadership’s mindset. You are constantly taking¬† your “boss” hat off and on to replace it with your “brother” or “father” or “spouse” hat. One moment you are family, the next you are boss and employee. It almost never works perfectly.

The biggest issues family businesses deal with is the breakdown of the organization. Family members constantly want to go outside the lines and do work they are not tasked to do, hand off work they don’t want to do to someone else (regardless if it is their responsibility or not) or take authority they don’t have. A breakdown in organization is a breakdown in communication, and a breakdown in communication guarantees costly errors.

There are upsides to family business, or course. It’s hard for someone in the family to quit and leave you stranded. Not that there is no “take this job and shove it” moments, but there is more likely to be a subsequent kitchen table talk that gets things back on track. The commitment to success, both individually and corporately, is strong and when it’s fun, it’s a lot of fun. Usually, there is not a big problem with motivation, everyone understands that failure on their part will resonate, not just throughout the company, but throughout the family as well. There is a high level of engagement.

Takeaways from our discussions on family business:

1. Family members must choose one of their member to have hiring and firing authority and be willing to accept that authority.

2. All family members must stay in their lanes. Doing more than your job is not helpful, and often harmful to communication. Doing less means putting pressure not only on workplace relationships, but family relationships.

3. All family members must learn to leave work at work, and home at home.

4. In a family business, family hierarchies are not business hierarchies. Often, one disrupts the other.  Humility helps.