The Family businesses They are a fundamental part at an economic and social level within our society and, in addition, They represent the most frequent and oldest type of commercial organization.
These organizations generate a very important portion of employment worldwide and they are key in the economy of any country. But they also represent a type of company very prone to extinction.
Almost 50% of family businesses do not survive the death of their founder; Of these, less than 30% reach the third generation and only the 1% They get to the fourth.
That’s why, one of the great challenges for all family businesses is to guarantee their survival.
Leadership and management in family businesses
The Family businesses they can become the most productive and the most rewarding on a personal and professional level for all members of the organization when managed properly.
The responsibility of the family business leader is crucial. The stability of these companies is largely related to good relationship between family members. Generating and sustaining that harmony is one of the main functions of leadership work.
In the Family businessesto the responsibility of managing the business, is added the need to keep family members together and create a sense of belonging to the family business that goes beyond the benefits.
The person responsible for running the company should promote family cohesion to guarantee the stability of the business.
5 Keys to leadership in family businesses
If you are the leader of a family business, you necessarily have to find the balance between dialogue and your own authority. Your role will be more or less successful to the extent that you can assume some of the fundamental challenges that your role implies:
- Instill a sense of belonging. You need to make it clear that the company, more than a business, it is the result of years of work, a source of well-being and an opportunity for the new generations. It is essential to generate interest among the young people in the family so that in the future they will be the ones to take the reins of the business.
- Separate family life from business. The biggest risk of the family business is believing that the private and professional spheres have to be permeable. The family level should not interfere in the operation of the family business or vice versa.
- Professionalize the company. Hire external staff when necessary. The family cannot encompass all functions. Endogamic organizations without an external critical vision can put their own functioning at risk.
- I learned to manage conflicts. Problems can be an opportunity for improvement. If the family is not capable of resolving company conflicts, I resorted to trained professionals.
- Take care of the communication. Speak clearly, without distortion. You need to establish the roles of each team member and give everyone a voice and importance. In family businesses it is important to learn to openly communicate the expectations, doubts, fears and hopes of each member.
Manage family businesses
Running a business involves put into practice and execute both the operational methods and the action programs designed for its operation.
Due to its importance within a family organization, this management role should be performed by trained and experienced professionals. These may or may not be family members.
This same criterion should also be applied to management positions. The lack of training of the new successors who enter to occupy managerial positions is one of the causes of the failure of many Family businesses.
For this reason, effective leadership is based on understanding that, in order to achieve the success of the organization, You need to have trained directors and managersendowed with skills, aptitudes and competences, regardless of whether they belong to the family or not.
The leader must be able to make practical decisions, taking care of the links, but at the same time avoiding the toxicity that can alter the operation of the company.
so that the Family businesses work, it is necessary to have trained professionals, willing to commit to the organization and make the right decisions to achieve a successful business.
Lic. Maria Sol Semino
Director of Accounting and Taxes.
www.growtion.com
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