People throughout the world dream of having a generational family business. Success, unfortunately, isn’t guaranteed, even in the most tight-knit group of relatives. Many firms make the mistake of keeping non-employee members away. Their insight shouldn’t be discounted, especially for a future family business succession.
There is a lot of value in including these members in making decisions. Learn more about your secret weapon with Positively People.
You Already Include Them in the Bottom Line
Whether you realize it or not, you likely already include family in your bottom line. Even if they don’t participate in the day-to-day operations, they still matter. Unlike other firms, your executives think about them when making decisions. It also assumes that the brand will remain in the family forever.
Companies like yours tend to mitigate risk better because family is involved. Don’t lose sight of what matters most, even outside your facility.
Hedge Against Hostile Takeovers
With Elon Musk’s recent take over of Twitter, many firms reevaluate themselves. Most notably, whether the company has enough cash to stave off coups. On the other hand, family business consulting is invaluable during these discussions. When there are no plans to change owners, it can cause chaos when becoming liquid.
That is especially true of privately owned stocks and established firms. Contact our family business advisory team when you aren’t sure what to do next.
Reinvest in the Family Council
Not every firm has a reliable family council and vice versa. Many companies only offer these roles a stipend or payment alternatives. That could alienate them further from the brand instead of welcoming them. Even if they don’t play a significant part in the business, they still offer insight.
Informed shareholders are typically those that prove to be better stewards than those that are shut out. Make sure you handle family governance correctly with our experienced advisors.
Payment for Accountability
The primary argument against paying family council members is a lack of involvement. When they’re excluded from operations, the corporate end doesn’t compensate them. Instead, why not utilize that position more effectively, even within the company? Adding clearly defined responsibilities justifies paying them as an employee.
Reinvesting in council members helps to secure an emotional connection to the firm. Why waste their potential when you can use it to your advantage instead?
Start Continuity Planning Early
It’s never too early to arrange for your company or your family’s future. Unfortunately, firms wait too long after younger members have no interest in it. Some brands prefer to separate the two halves of the family business. Relatives should feel like more than a set of expenses and tax write-offs.
If your large gatherings aren’t including educational sessions, they need to start. The sooner they become involved, the easier family business succession planning becomes.
Keep the Next Generation Engaged
Too often, the younger family members are excluded from the business. That leaves them feeling unwanted and they quickly lose interest in the company. Instead, you should always encourage some degree of engagement, even with children. Then, as they age, they become willing participants in the organization.
That becomes especially handy for college internships and expanding the business. However, waiting too late to include them becomes an uphill battle getting them back.
Create Your Talent Pool
Most companies wish they could maintain an in-house pool of talent. Most firms settle for whoever currently needs a job, with or without skills.
Another benefit of including younger members is that it builds more capable employees. By instilling the needed abilities of those at a young age, you can plan for both futures. Your relatives and the company will both benefit from improving their skills. Contact Positively People today for even more ideas on how to reinvest in your family. Learn more about Positively People services here.