For some, the words “family business” evoke a chaotic vision, riddled with conflict, heated arguments, and dysfunction. Running a business with your family or spouse can be exponentially challenging, and can even be downright scary. However, family businesses – when successfully operated – can lead to generations and generations of prosperity, and for many, this model is the norm.
Technology, real estate, agriculture, hospitality, and countless other industries have been run effectively by families for generations; some of the largest retailers and corporations in the world grew up and outward from a small family business model. CEO of Honora, Joel Schechter, weighs in on the advantages of running a family business, noting 7 major benefits. Here’s what he says are the benefits to consider:
- Speed. Because the family is a “natural team,” they will be well equipped to effectively (and speedily) deliver products or services faster than competitors, in many cases.
- Solidarity. Schechter explains how families already have the same interests in mind, so there won’t be any competing agendas in the workplace. Though disagreements can certainly take place in a family business, you can be sure they won’t happen because of family members trying to get the edge over one another.
- Nature plus Nurture. Often, an entrepreneurial spirit is found in generation after generation, which means that one’s skills can be honed when they grow up being part of a family business. Carl Mattone, for example, president of the family-owned Mattone Group, watched his father develop more than 70 properties in New York, which prepared him to take on a leadership role that has garnered the family business great success.
- Authenticity. Family businesses tend to be more genuine, and more transparent. There is a level of love and appreciation for one another that allows a real and honest company character to emerge, which can be great for customer relations.
- Trust. Although some family businesses have displayed a public breach of trust (James Murdoch, News Corp., and Rob Ford to name a few), trust is paramount in any business, and on a personal level. Family businesses definitely have the edge in this department.
- Control. Family businesses control the fate of its employees and the business itself. Each member will have some kind of stake in its future and direction, which often results in collaboration and strong communication.
- Next-gen ingenuity. Schechter explains that companies often lost their competitive edge when leaders lose touch with the youth market. In a family business, the younger generation will always be there to push the company towards more innovative practices.
These are just one expert’s take on the advantages of running a family business. How do you weigh in on the pros and cons?