Entrepreneurship is hard work and also incredibly rewarding when things are going smoothly and profits are being made. When the company is struggling it doesn’t feel great, and it lands on the leader to get the company on track. Assessment of past, present, and future goals, and year-end reviews are crucial in growing a profitable and healthy functioning company. Regular evaluation in a family business can get you out of a rut and keep the company out of one. Here is where to start.
Step 1: Evaluating the Pros & Cons of a Family-Owned Business
Here are the Pros – what would you add to the list?
- United purpose to contribute to the success of the business, commitment to legacy
- Willing to support the company financially during hard times
- Relaxed, more flexible working environment
- Ability to be adaptive and change direction, respond to internal and external cues as needed
Here are the Cons – does this sound like your company? Are there more you would add?
- Personal conflicts overtake the workplace environment. For example, sibling rivalry arguments disrupting business meetings.
- Non-family employees may feel like they can’t compete with family members. For example, an employee is having communication issues with a family member of the business, but does not feel comfortable voicing his concerns to management.
- Promoting from within when a non-family member of the business is more qualified for a position than a relative of the business owner. How do you keep things professional and manage the potential fallout making your candidate choice?
- Leadership resistance to change. For example, family businesses, often traditional in nature, can find it difficult to let go of the reigns and have younger generation members lead change.
Step 2: Determine Your Priorities – Setting Goals & Objectives for Your Family Business
In growing a successful family business, having goals and objectives in place for small and mid-sized businesses makes the assessment process so much easier as you have a benchmark to compare your results. Being clear on your vision, goals, and action steps establishes the road map for a successful business. Having a master document of these will assist executive leadership, governance, and management in doing the assessment.
The benefits are, priorities will be clear, family members and employees will have the compass for how to contribute to the company, and expectations are well laid out.
In quarterly and yearly reviews, departments and leadership can assess if the business targets are being met and if any modifications or scheduling changes need to be made for the next quarter and year.
Step 3: Be Patient – Understanding Time is on Your Side as You Build & Grow a Family Business
If you do not currently have SOPs (systems and operating procedures) for assessing and reviewing your business, this may take some time to get in place. Patience in entrepreneurship can be frustrating as entrepreneurs are known for their ‘getting-things-done’ attitude! Family business owners are building a company, and this takes tenacity, faith, and the skill to manage and face challenges. That being said, patience and endurance do not have to be hard or stressful. Having a consultant specializing in the complexities of family business, who can guide you through the process, get systems in place, mediate relationship conflicts and really hear what you and your company need makes a tremendous difference. It takes the load off your plate for trying to figure out how to do it all, someone objective who can see the big picture, patterns, and root of the problem is invaluable.
Conclusion
With these dynamic, moving parts of a family business, it is crucial to partake in business assessment to see what is working, what is not and make an action plan to be clear on how to steer the company going forward. Knowing your business vision, goals, action steps, and having a system of assessment in place will help prevent and address problems as they arise.
We are nearing the end of the first quarter, but it isn’t too late to assess last year’s performance and for the first quarter to see if your New Year’s planning is on course. Receive your assessment sheet by filling out the form below:
Would you like objective insights of your assessment, and suggestions moving forward to the 2nd quarter? Contact me for a 30-minute discovery call.
