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The Pros And Cons Of Requiring Children To First Work Outside The Family Business


wealthymattersGenerally,the term ‘family business‘ evokes plenty of envy,fueled by images of no-account inheritors living it up,even as other meritorious souls in society don’t get a chance to take the easy road to the good life…….of concentration of wealth in the hands of the few,to the detriment of all others.

Under the circumstances,business schools,family-business consultants and the media today,feel the need to recommend that people work for at least 5 and sometimes 10+years outside the family business.In fact the education system feels the need to socialize children to seek success in fields far removed from their parents own occupation.Besides business families themselves feel it good PR today to talk of how their children won their spurs outside the family business and so are not mere inheritors.

Here are the pros of first requiring family members to work elsewhere before entering the family business : Read more of this post

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Questions To Ask Before Joining The Family Business


wealthymattersEven as there are plenty of people who effortlessly slide into satisfying roles in the family business and go onto growing it and successfully passing it down yet another generation,there are plenty of people who have regrets.Regrets about joining the family business or regrets about inducting a family member into the family business. In the worst case scenario,family businesses have to be split,forsaking the synergies that were taken for granted when the consequent parts were one whole or worse yet,families themselves have acrimonious splinters and end up losing everything they had.

A way to avoid unnecessary pain,is simply to reflect deeply before adding a business angle to family relationships and having the necessary conversations in an open manner instead of avoiding them,only to find oneself in the midst of bigger problems. Read more of this post

Of Feuds And Family Businesses


wealthymattersStrong disagreements are inevitable in all human relationships, but families that own businesses are more at risk for serious conflict than ordinary families because the power, status, and money at stake are greater.

There are seven predictable stages of conflict.These stages are largely avoidable, but the owners of family businesses have to be aware of them,and of the ways to extricate themselves when they get caught up in a spiral.

The Seven Stages Of Conflict Are:

1) Interests Diverge :

An interest is a broad desire that a person or group of people have for something. Some interests are shared; others are individual. Most business families are united first and foremost in their wanting  to keep the business healthy. However, given that family members have different roles and responsibilities as the family business grows, interests naturally diverge. Some family members work in the business, and some are owners (some are both; others are neither). Those employed in the business will be more inclined to channel profits to re-investment and bonuses, while owners will be disposed to pay higher dividends. Where anyone stands on a particular issue will be influenced by where they sit in the family business system. Read more of this post

Managing Conflicts In A Family Business


wealthymattersFor most people, conflict is uncomfortable. That can be especially true in families who’ve watched family conflict tear successful businesses to pieces:.What’s less often recognized is that too little conflict in a family business can have an equally destructive impact. The impact of both too much and too little conflict on both the family and their enterprise are almost identical. In both cases, the business can suffer from limited growth, poor decision-making, a loss of competitive advantage, and, in severe cases, the sale or split of the company. Similarly, families tend to break up into factions and suffer poor relationships. The mechanisms are different, but the results are the same.

Conflict is a “Goldilocks problem.”In the sense the earth is in what astronomers refer to as a Goldilocks Zone.Much closer to the sun and it would be too hot to sustain life, much further and it would be too cold to sustain life. Though the reasons differ, both extremes make life uninhabitable. Both ends of the spectrum are ultimately unsustainable–so the best place is in the middle. Read more of this post

Managing Careers In A Family Business


wealthymattersIn family businesses, hiring and staffing decisions are based on relationship and obligation as much as on competence and experience. After all, one purpose of family businesses is to provide employment for the family members ! But that doesn’t mean all family members perform effectively,all the time. People may slack off or stop collaborating, and sometimes they get a pass for their mistakes or behaviors. At times, they may even be disruptive to the smooth running of the business.

So what can be done in such circumstances? Read more of this post

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