Should you join the family business?
Working at the family business can be highly rewarding – but how can you be sure it’s right for you?
2 min read
For second – and third – generation family members, there can be an expectation that they’ll join the family firm at some point. For those passionate about driving the firm forward it can be extremely enjoyable and fulfilling, while those who are less sure might worry about accusations of nepotism and a fear of failure.
How can you tell if it’s the right choice for you?
Who are you?
The key to making it work is to think hard about whether you really want to do it in the first place. It can be easy to lose sight of who we really are when we’re surrounded by the expectations of others.
Stuart May, Coutts Senior Associate, explains, “Your first question should be ‘why?’ not ‘when? The most successful family businesses tend to be those where the next generation is passionate about driving the business forward rather than nervous about the burden it places on them.”
So to get started, carefully consider your dreams and ambitions and share them with your family. Do they accord with the direction your family business is heading in?
If you do decide the family business is for you, it is important to consider the specific type of role you want to play. Would you like to join the workforce or take ownership as a shareholder? Or both?
Shareholders will typically have little involvement with the day-to-day running of the business. Instead, they will need a broad understanding of the aims of the business so they can hold the board accountable and help steer the ship in the right direction. Your financial reward will come in the form of dividends, but they are by no means guaranteed. How well you’re able to influence the company could have a direct effect on how well the company performs.
Become A Client
When you become a client of Coutts, you will be part of an exclusive network.
Joining the workforce will give you a regular salary and you will get to learn first hand how the business operates. This can be invaluable, especially if you see yourself taking a leadership role with the firm at some point in the future. But if you become an employee, you’ll need to be mindful of how your colleagues might perceive you.
Wherever a family member is based within a company, and whatever authority they have, many staff will see them as a family member first and an employee second. For example, the speed with which you are promoted, even if well earned, can cause friction if perceived to be too fast and ahead of other long-standing employees.
To get on the front foot with this, some family firms put a clear process in place that stipulates how family members are managed, evaluated and rewarded. It’s best to acknowledge that – as a family member – your employment is slightly different from your colleagues. If the company is upfront about it, and builds a transparent process to support it, then this can prevent problems.
It’s also worth considering the best time to join the family business – should you dive straight in or work elsewhere first to get broader experience?
Stuart says: “Many will introduce the next generation to the family firm early – by getting their children to visit them at work or arranging summer jobs or internships. This brings them a great working knowledge even before they are employed full time.
“However, the importance of experience outside the business cannot be overlooked. This should also be considered in light of your dreams and aspirations as well as the skills and value you can bring.”
He adds, “Many family firms are built on a history of entrepreneurship and an instinct for business. Spending time building your own business, for example, starting from scratch and testing your ideas, can make a real difference to the skills and attitudes you bring to the family firm. Alternatively, you may choose to pursue a career in another organisation first to develop skills in a specific area like marketing or accounting.”
To find out how Coutts could help, or to request a copy of our Handbook for Families in Business, speak to your private banker.
If you’re passionate about the family business, contributing to its success can be one of the most rewarding experiences you can have. Before you join, though, it’s worth fully considering your options and ambitions.
Three things to consider: what role you’ll play in the firm; when is the right time for you to join; and how you’ll counter claims of nepotism. Making sure you’re comfortable with your answers will help set you up to make a long-lasting contribution to your family legacy.
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