05/05/2020 Council Post: Three Tips For Running A Successful Family Business

158 views | Apr 22, 2020, 07:20am EDT

Three Tips For Running A

Successful Family Business
Meganne Wecker Forbes Councils Member
Forbes Business Council COUNCIL POST | Paid Program
Small Business

POST WRITTEN BY

Meganne Wecker

President and Chief Creative Of cer of Skyline Furniture and Founder of Cloth & Company. 

Photo: GETTY

Taking the leap to start a business is daunting enough, but throw in the
stress of partnering with family members, and the stakes skyrocket as the
odds for success prove staggeringly disheartening. Seventy percent of
family-owned companies fail or are sold before the second generation.
Just 10% survive for the third generation, according to the Harvard
Business Review. Statistics aside, when operated properly, family

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05/05/2020 Council Post: Three Tips For Running A Successful Family Business

businesses have inherent strengths otherwise not afforded to sole

proprietors.

For more than seven decades, my family’s manufacturing company has

grown from a modest family business to a tech-focused manufacturing
powerhouse that employs more than 300 people. Founded by my
grandfather in 1946, the reins of the business were passed to my father,
and after years in various positions, I’ve taken the helm as the third
generation. With the current trends toward globalization and the further
decline of the retail sector, we’ve adapted our business model in a way
that keeps us nimble, but there are three key attributes we’ve kept close to
our chest for the past 70 years that have significantly contributed to our
success.

Recognize the power of the family bond.

I’m not only referencing your own family. Yes, it’s critical for you to
openly communicate and remember to keep your familial bond intact, but
in a family business, "family" should mean so much more.

For example, at my family's company, we have many employees who have

been with the company for more than three decades, and along the way,
we’ve hired family members of these employees. It’s become a
multigenerational operation on the staffing front, as well. We’re
incredibly humbled that these families have invested their time and hard
work into our company, and we make sure to reciprocate that investment
tenfold, whether it’s the health, well-being or education of our employees.

Consider the ways you can invest in your team members. For instance, we
offer English programs during work hours, on-site training facilities and
flexibility for those wanting to pursue advanced education. We also offer
financial assistance to families to ensure their children receive a collegiate
education that allows them to pursue their professional dreams.

While it can be costly, I believe you'll find the results priceless. In my

experience, employees tend to be more loyal to a company that values

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05/05/2020 Council Post: Three Tips For Running A Successful Family Business

their well-being, which can lower turnover and have a positive impact on
the profitability of your company.

It’s OK to recruit outside the family for positive growth and

change.

My father never put any pressure on me to join the business. I’ve been
taught to follow my passions without being "groomed" for specific roles in
the company. After leaving college, I grew into my chief commercial
officer role organically. It's a position that properly leverages my talent
and is one that I feel excited about.

Too often in a family business, members are guilted into joining and given
roles they aren’t passionate about or adequately trained for. As a family,
ensure you are clear-eyed about your strengths and weaknesses in the
professional world. Your collective goal should be to ensure the business
continues to flourish, so go to great lengths to hire the right person to fill
the job — family or otherwise.

Don’t settle for comfort. Take risks.

My grandfather worked at our family business until he was well in his

90s. My dad is also in his 70s and continues to work with the gusto of a
man in his 40s. While stagnant leadership can often lead to the demise of
a company, my father and grandfather have always been eager to innovate
the business, even in growth periods.

Some of our greatest achievements as a company have stemmed from our

ability to pick trends, pivot our business and employ modern technology
before our competitors. As a business leader, it can be risky to innovate
when business is in an upswing, but often there is more to lose by not
making a change.

An established family business is a gift and a privilege. It’s incredibly

rewarding, both financially and emotionally, to build a family legacy and
often work with people you have known since you were a child. At the
same time, the ongoing success of a family business can't be taken for
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05/05/2020 Council Post: Three Tips For Running A Successful Family Business

granted. As a new generation takes the reins, they need to work with the
same level of dedication, entrepreneurialism and foresight as their
forefathers to ensure the company continues to thrive.

Forbes Business Council is the foremost growth and networking

organization for business owners and leaders. Do I qualify?

Meganne Wecker

President and Chief Creative Of cer of Skyline Furniture and Founder of Cloth &
Company. Read Meganne Wecker's full executive pro le here.… Read More

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