Is yours a family business? You are not alone
Are you the founder or next-generation owner of a company? When at work, do you see family members on a daily basis?
If you answered yesto these questions, do you consider your business to be a family business?
I have a board member who recently told me he has nine family members working for him, and he had not considered his business as a family business until his son and heir apparent started to participate in a NextGen Peer Group.
I like to think this is an extreme case of an executive so focused on moving his privately held business forward, he did not realize the impact of the family on the business (and vice versa). My guess is the other nine family members working in the patriarch’s business realized what it truly was.
National statistics show that 80 to 90 percent of all businesses describe themselves as “family owned.” Locally, Grand Valley State University did a survey of West Michigan and found that 88.8 percent of all businesses locally identified as family businesses — on the high-end of those national statistics.
There are thousands of family-owned businesses in West Michigan. They are found in every city, industry and size. So why don’t people realize what it means to own and run a multigenerational family business?
Perhaps it is the lack of “family business”marketing, or that, until recently, “family business”has not been taught in business schools.
Perhaps it is circumstance. For instance, a founder/entrepreneur with a growing business has kids who ask to join the company. Suddenly, the founder has family members working with him or her, and has to think about transitioning the company in a different way.
Just like that, the entrepreneur has a multi-generational family business.
If you are just now considering that your company may be a family business, there are a few things you should know, including that family businesses are critical to the success of the community and it can be both rewarding and challenging to own a family business.
It is rewarding because family businesses employ the local community, and through good business practices, family businesses are making West Michigan a great place to live, work and raise a family.
As you might expect, family businesses have a long-term approach to business — an approach not dependent upon a board of directors in a far-off city. Lastly, it is completely liberating to work with people (i.e. your family) whom you trust completely and who “have your back.”
Still, family businesses also can be challenging.
For instance, it was an aforementioned NextGen Peer Group participant who shared that “not feeling alone” was the primary value he received from participating in a peer group. In challenging times, who does one turn to? For example, how does the next generation share their frustration at having to work harder than anyone else (including the matriarch and patriarch) and that all eyes are upon them at all times — without sounding like a spoiled brat?
The business owner has a different set of challenges. For instance, most likely he or she has gathered advisors around him or her over the years. But as one family business owner stated at a recent event on succession, “Each one of my advisors tells me something different —who do I trust?”
Whether it is dealing with interesting family dynamics, long-time employees who constantly measure the next generation against the matriarch or patriarch, the lack of an “off button”even during family holidays and vacations — or all of the above, owners and their next generation are not alone in feeling both the joy and pressure of having a family business (or two) in the family.
One way family business owners and next generation members are connecting with other family businesses is through peer groups. There are many to choose from: The Grand Rapids Area Chamber of Commerce has the CEO Roundtable program; the Young Presidents Organization has its Forum; and the Family Business Alliance has a peer group program for the next generation of family business and a separate group for their parents who are focused on succession.
Regardless of the industry, size, generation or location, the family business community is large and varied. There are many ways to learn with and from others who also are focused on leading successful multi-generational family businesses. You are not alone.
Ellie Frey Zagel is the director of the Family Business Alliance, a membership-based nonprofit headquartered in Grand Rapids. The FBA has more than 150 family businesses members throughout West Michigan and provides family business events, workshops and peer groups for the family business community. Ellie can be reached via email at firstname.lastname@example.org.