Running a small business is tough. Most of us start our business because we are good at something yet have nearly no knowledge of everything else that goes into running a business. For those tasks, like bookkeeping, for example, we typically learn by doing. And failing. A lot! If we’re fortunate to survive these lessons, then we might just make it. Competition comes crashing around every corner, and technology has a way of throwing our paradigms and assumptions asunder. Yet all of these are manageable to a degree. What happens when you throw in a family member? All bets are off and complications are taken to a whole different level, in other words here’s why family business fail.
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Noam Wasserman covers some interesting ground in The Founder’s Dilemma about the impact of running a company with family and friends, proving with empirical data what many of us already assumed – working with family increases the chances of failure. That is not to say that all family businesses are doomed, just that it increases the complexities and therefore the likelihood of failure. I could provide many anecdotal cases of clients with whom I’ve worked over the years, but let me tell you one that hits very close to home – my own.
My brother Nathan has worked with me for 12 years, first as an employee, then a partner. I distinctly remember when we were on vacation several years ago my saying to him that I thought we rarely disagreed. He was stunned because he thought we disagreed quite a bit. Uh oh. Unfortunately, I didn’t pick up on that, or I might have saved myself many headaches. Nathan is a Fact Finder (Kolbe Index)Quick Start (Kolbe Index), and although I’m not resistant to fact-finding, I found Nathan’s constant questions irritating. I thought he was just trying to throw cold water on things and was pessimistic. Paralysis by analysis is the way I described it.
Because I was resistant to his advice, even dismissive, I walked straight into what should have been easily foreseeable and avoidable landmines. Additionally, Nathan didn’t feel his advice was wanted, so he quit giving it until he finally couldn’t take it any longer and insisted that I accept a change he had demanded. In retrospect, it wasn’t a big decision in its impact to the company, but it was huge to our relationship. It was a heated discussion and Nathan dug in his heels. I finally acquiesced and the dam broke.
Over the course of the next two years (and even through to this day), our relationship has evolved. We both went from disliking the way the other did things, to tolerating, accepting and now needing each other’s approach and perspective when making business decisions. It very easily could have gone the other way. By embracing these different perspectives, we are able to gain valuable insight into how our different clients may view and perceive our services – and that is a powerful thing. The benefits from melding different personalities and strengths are something you often see in companies without family members, but if you can make the point to step back and realize the advantage of not always seeing eye-to-eye, you can make it work in your own family business.
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The bottom line is that convergent thinking in business is usually a disaster. Group thinking can lead to ignoring both opportunities and threats. Instead of firing your brother when you disagree, I strongly suggest that you listen to him, as you may be able to learn something new and find ways to make your company even more successful. Contact our offices in Oklahoma City: 405-720-1244 or Tulsa: 918-477-7650 to get the help you need.