How You Can Seamlessly Manage Family Business
The Indian community in Kenya has been known for business, over decades and it is not expected that anything will change soon. They have cultivated a culture of hereditary business, where the family business is passed from generation to generation, without failing.
Recently, the Somali community has followed the trend and are thriving in business in major cities and towns in the country. A few other Kenyans have followed the trend, but few businesses survive after the exit of the pioneer.
In order to make sure that family business thrives even in your absence, it is important to follow the following tips.
Set rules
Having family members around your business does not mean you are safe. In fact, they are the most dangerous people around any business entity. Setting rules will make sure that the business runs in a formal way. In addition to the rules, there should be consequences of breaking them, otherwise they will be useless.
Rules help establish expectations, relationships and provide guidelines within which to conduct daily business activities. They also regulate compliance with local, state and federal agencies that govern your particular type of business operation.
Train family members
The most successful family businesses are run by family members who have been trained since inception. They hold the innermost secrets that can never be let out to outsiders, no matter what.
Read: Why Some National Account Imbalances Are Fine But Others Aren’t
Training also instils discipline to the people handling the business. If you have children, it is good to incorporate them into the family business immediately they leave school, so that they can get the skills to run the business in your absence.
Keep business issues out of Family matters
Whenever handling family matters, some people tend to include business issues therein. The two entities should be handled separately to foster growth and retain family ties at the same time.
That is why as earlier stated, the business should run on a set of rules to avoid crushing it for conflict of interest.
Pay employees
Some business owners tend not to pay family members working in the business. It is wrong. Blood ties cannot pay bills, neither can they compensate on what they do. They may offer pro bono services for some time, but at long last they will leave, no matter who they are to you. Even children will leave.
This means that at the time of transition when you can no longer run the business there will be no one to hand over to. Those that you could have handed over to will be working somewhere else, and maybe not ready to come back. This is how family businesses die.
Develop a succession plan
It is always good to prepare for the worst to achieve the best, and this could include your demise. Without succession plans and will, family members will be left in wrangles, and where wrangles exist success sublimes. The plan should spell out the details of how and when the mantle will be passed to a younger generation.
