Family businesses continue to form the backbone of the American economy. Did you know that 35% of the Fortune 500 companies are family-controlled businesses? Family businesses account for 50% of the United States domestic product. Family businesses generate 60% of the country’s employment and 78% of all new job creations. For example, Wal-Mart, News Corp, Tyson Foods, and Ford Motor are all family businesses. One thing that all of these businesses have in common is that they all face the same challenges of maintaining continuity, longevity and lasting success. Secondly, the controlling family’s members are currently active in top management and the family has been involved with their company for at least two generations or they plan to be.
Here are 5 tips to ensure the success of your family-owned business:
1.Most families who succeed in business would agree with Thomas Edison that success is a mixture of “10 percent inspiration and 90 percent perspiration”. The secret of building a solid, enduring family business is that everyone who’s seriously involved in it has to work and work hard.
2.The adhesive that seems to hold most successful family companies together is a combination of mutual affection, collective admiration, shared goals, and complementary skills.
3.The family member in charge of a successful family business must wear two hats. You can love your daughter (the consulting manager) even as you bring to the attention of the consulting manager (your daughter) the recent customer complaints that have not been resolved by her staff.
4.Consistency between the family’s values and the fundamental principles or the way business is done must always be in harmony.
5.It is important to take some time off and some time away from the business. A potential problem for families in business is the pressures of being constantly with the same people all of the time.
The typical family business is a sole proprietorship that is most likely to operate from the home (56.6%) as it is from another location (43.4%). The average family business is ten years old, with three out of four having been started by the current owner. Businesses founded after 1990 make up 35% of the total family business in the United States. Computers are used in 70% of all family businesses.
In general, families who operate a family business rate their quality of life as a ‘4’ on a five-point scale. Household managers often participate in the family business. Eighty-seven percent of the household managers report they would rate their level of satisfaction with their role in the family business on a five-point scale at a ‘4’ or ‘5.’
Finally, be proud of your company and your family and let the world know it. If your name is on the door, you have a double role both inside and outside the business. Your pride in the company, in the work it does and in the family that stands behind it can have mammoth management and marketing value. Family members involved in successful family businesses really let their pride shine.