Family Business Matters 05/15 14:05
Four Questions to Help Fine-Tune Your Family Business
Here are four questions families should ask themselves to help understand
and clarify their own culture.
By Lance Woodbury
DTN Farm Business Adviser
Each family business has its own culture -- a unique combination of beliefs
and actions that shapes the way the business understands itself. This family
business culture, while neither right nor wrong, reflects the way members speak
and act, what they consider most important, how they respond to crises and how
they deal with the future.
The culture of your family business creates a feeling about your family, an
impression of your organization on everyone from in-laws and employees, to
vendors and neighbors. If you asked a new employee, "How would you describe the
culture of our family and business?" and what would he or she say? Would they
answer in a way that recognizes and honors your intentions?
A useful method to understand and clarify your family business culture is to
ask yourself four questions. These questions are important if you want to grow
your business, hold assets together or attract and retain quality staff,
including family members.
How would you answer the following?
-- DO YOU TALK ABOUT PROBLEMS? The most frequent critique I hear of family
businesses is that the participants won't talk about some of the issues causing
problems in their family or business. These issues often involve either people
(family or staff) or profitability. The reasons for staying quiet might include
their discomfort with conflict, the inability to see a solution, or the fear
that talking about it will make it worse or give the appearance of failure.
But, rarely does avoiding discussion help the family in the long run, as the
frustration eventually disrupts the working relationships.
-- DO YOU TALK ABOUT THE FUTURE? Another communication marker is the
family's willingness to talk about a plan for the future. How will the farm or
ranch transition to the next generation? Who will manage it? How will off-farm
heirs be treated? How will we adapt to low grain or milk prices? An
unwillingness to discuss the future causes everyone to work from unspoken
assumptions, which creates disappointment if those assumptions do not
-- HOW DO YOU GO ABOUT YOUR WORK? If you had to describe a day in the life
of your organization, what words would you or your team use? Would they say you
are organized or chaotic? Ahead of the game or perpetually behind? Laid back,
trusting and fun, or intense and micromanaged? The point is that if the
description does not fit your intent, you should work to change the culture.
-- HOW DO YOU DISCUSS MONEY? One of the challenges family business members
often face is how much to discuss their finances. Should you tell your children
your net worth and at what age? Should your key employees understand your
profitability? What you share -- or don't share -- influences how people see
your business. If you buy new equipment and vehicles frequently, or if your key
staff members don't understand your income and expense structure, people may
assume you are always performing well. If you don't talk with your adult
children about your finances, they may be ill-prepared to carry out your estate
and succession plans.
On the other hand, discussion of your financial picture -- which you can do
at a high level without disclosing all of the details -- can create a stronger
sense of psychological ownership of your business and of the family asset base.
Organizational culture is a popular topic in business literature -- and for
good reason. How people see your business influences whether they want to be
involved. How you deal with concerns and conflict, how you approach the future,
the feelings people have about your workplace, and how you talk about finances
will sharpen and clarify the distinctive culture of your family business, and
either help or hinder your family's future work together.
Write Lance Woodbury at Family Business Matters, 2204 Lakeshore Dr., Suite
415, Birmingham, AL 35209, or email email@example.com
Copyright 2018 DTN/The Progressive Farmer. All rights reserved.
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