This article originally appeared as a column for the Cleveland Jewish News.
Working with family – outside the home – can be just as frustrating as it can be rewarding. On one hand you get to spend more time together. Other the other hand, you have to spend more time together. On one hand, you are working with people you (presumably) trust. On the other hand, if someone breaks that trust, you still have to see her at family celebrations and on holidays.
Here are a few points to consider before mixing business and family, to make this union more likely to succeed.
In deciding to go into business together, be certain you have a meeting of the minds – make sure you agree about how the business will operate, or how the specific business deal will occur. The clearer you can be, the better; this is no time to simply assume that you are on the same page about something or everything. You will not be able to predict or plan for every possible outcome, but it is helpful to talk through some potential scenarios, and to consider how you will manage strife and disagreements in the business relationship.
Avoid letting your personal and professional lives collide – when you work and live with the same people it becomes easy to bring your personal issues into the business relationship and your professional issues into the home. While a complete separation of the two is likely not possible, you may find that some compartmentalization will lead to more peaceful family functions and more productive business meetings.
Fairly distribute the labor and wealth – it is imperative to discuss your roles within the business, your expectations of how the business will operate, and what you intend to do with your revenue.
Do this up front, and do this on an ongoing basis.
Be careful of nepotism – there is nothing wrong with hiring family members; after all, it is a “family” business. But, make sure the hiree brings value to the business or deal. Hiring an unqualified employee simply because he is family is a surefire way to breed resentment among others within the organization and may cause you to lose the good talent that you would rather keep.
Define your organizational chart – especially if the business is small or just starting, roles will certainly overlap. However, some delineation of roles is necessary to make sure things are getting done. And, it is imperative to have a clear hierarchy. Even if your hope is that everyone would have an equal say in the running of the business, to grow the business successfully there must be a mechanism or person with the ability to resolve a stalemate.
It can be very rewarding – both personally and financially – to start and run a business with family. The key is to clearly outline expectations and roles and, above all, manage it just as you would manage a business with no family involvement.
*Andrew Zashin writes about law for the Cleveland Jewish News. He is a co-managing partner with Zashin & Rich, with offices in Cleveland and Columbus.