Considerations for family-owned businesses to keep in mind
As seen in the Tried & True Spring 2023 issue
Four generations of family-ownership have taught Fratco’s leadership a thing or two about doing business with your kin. Close relationships with dozens of contractors who also run family-owned businesses have taught them even more. Here are a few pointers for anyone with skin in the game and family on their payroll.
1. When your coworkers are family, business is personal
In a typical job environment, spats between coworkers have more room to de-escalate naturally over the course of evenings and weekends spent outside the workplace. But when your job is a family business, your coworkers come home with you—along with any tension that’s been built up through the workday. Additionally, the stakes of unresolved conflict are much higher in a family business. Getting fired from a job is nothing to sneeze at, but getting “fired” from your family is a truly traumatic and life-changing event.
To prevent your business coming between you and the people you love most, always treat the members your family-owned business with an extra teaspoon of respect and goodwill. If you also have employees that aren’t related, that means giving them an extra serving of respect as well—no special treatment allowed, everyone deserves the same level of respect.
2. People aren’t coal: pressure doesn’t turn them into diamonds
Authentic interest is essential when it comes to involving family members in your business—especially your children. Your kids love you, but there’s no guarantee they’ll love the trade you’ve chosen or the business that you’ve built. It’s easy for you to confuse the two as a parent, and it’s also easy for your children to accidentally project their love for you onto your business when they feel like doing otherwise would disappoint you.
Rather than pressuring your children to carry on the torch after you retire, lead them by example. Show them that you’re passionate about your business and wait patiently for their interest to pique. Make the prospect of joining your enterprise a soft sell, rather than a hard one. In the words of Fratco customer and Lick Creek Enterprises owner Jim Mathias when asked whether his kids would ever take over his business: “If they want it.”
3. If they’re not a good employee, they probably won’t be a good leader either
This last piece of advice can be a bitter pill to swallow, but not every truth in life can go down smooth. The future of your business depends on good leadership, and here at Fratco we believe that the best leaders are made on the job—not from blood, but through hard work.
Former CEO Steve Overmyer began helping out in the Francesville plant when he was just six years old. Current CEO Chris Overmyer’s early experience in the company was very similar. As each grew into adulthood and chose to become full-fledged employees, they were expected to perform to the same standards as anyone else. Each put decades of hard work into the business before they became a leader in the company. In other words: they did everything they could to prove themselves worthy.
When considering your business’s succession, try to see your relatives as employees first and family second. Watch what they do, how they treat other members of your team and how they speak about the business. If they take it for granted, maybe it shouldn’t be granted to them. Your family can always share in the fruits of your business’s success, but they aren’t necessarily entitled to a seat at the helm of the ship.