Family Business: Sanity, Family: Not Mutually Exclusive

1 Jan, 2008 By: Lloyd Merritt Smigel Pest Management Professional

So you are working in a family business. Are you in therapy yet?

I have been working with family-owned pest management firms for more than 30 years. It has been a very interesting ride. I never wanted to become well-versed in this area, but it is a major part of our industry.

Each family operation has a uniqueness to it. Rarely are two family scenarios the same, thanks to factors such as:

The number of generations involved;
The status of family relations;
Which relatives (and in-laws) are involved;
Varied markets and locations; and
Different service offering blends.

PREPARE FOR SUCCESS

Most family operations have problems because the older generation just hands over their businesses rather than drafting true succession plans. Rarely do they have a family mission statement for the business, or a family business plan that's separate from a regular business plan. Training seems to be "whatever" as opposed to well thought-out programs.

Additionally, there is rarely any testing done to see whether the incoming generation has the leadership and business skills to take over operations. Rather, it is assumed that the company will go to the next generation through some sort of invisible birthright that does not exist.

Then there are the generation wars that go on: Which son, daughter or in-law has the majority say?

The players and how they play make a big difference.

FAMILY FEUD?

The sooner these issues are acknowledged and confronted, the easier it is to develop solutions to them. Unfortunately, the players usually already are well entrenched within their companies when I get there. That is when I hear questions such as:

"When should I ask for stock from my parents?"
"When will I take over the company?"
"How can I get my parents out of here so I can get things done my way?"
"Don't you agree: Shouldn't I be taking over the company, not my sister."
"Shouldn't I get more benefits?"

And on and on and on. Now let's go to the other side's often-voiced concerns:

"My kids think they know more than I do."
"They don't put in the hours."
"They don't have any idea what they are doing."
"The younger one should be in charge of the company."
"I would rather sell the company than turn it over to any of them."

I play the middle man. When I go into one of these situations, I have to make it clear that I do not represent either "side." I represent what is best for the continuity of the company.

Sometimes, I have to say what they need to hear, as opposed to what they want to hear. Sometimes I tell them my opinions, which is met with "That is what I was afraid you were going to say." But someone has to straighten out this stalemate ? or the company and its employees and customers will suffer.

I usually interview several employees before I evaluate the family businesses for which they work. I learn what the reality is. Often, non-family employees know what's happening and feel they, too, are stuck in the middle. It's sort of like witnessing your parents fight. No one likes it.

KEEPING THE PEACE

A needs analysis of each family business is key to establishing guidelines for the future. Lines have to be drawn to define roles, rules, deadlines, training and objectives.

There is no fault or blame here. It is what it is, and it has to be fixed. Usually the players are much too involved to help fix it, and they don't want to hurt anyone's feelings ? so they just let it go. This is the worst thing you can do.

For the sake of all involved and at risk, get help from someone who has family business succession planning experience in our industry, or you'll be in therapy.

Smigel, president of Care Management Consultants in Oceanside, Calif., will be having a two-day Strategy Retreat March 28-29. Please call 888-711-3232 or e-mail becky@lloyd-smigel.com for more information.

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