Business tv :Non family can make your family business better
More expert business advice from Paul George from the Business Families Team at PricewaterhouseCoopers, as he reveals why he thinks taking on a non-family member in that senior positions in your family business could be the wisest move:
“I think hiring senior staff from outside the family is always a challenge for family businesses, particularly the first time they do it, it’s a big step for someone senior to come into a family business and be very conscious, a bunch of unwritten rules, very unclear about how the family operate, the feasibility of the business and I think family businesses are also quite nervous about whether they can compete with public company reward scenarios like share options, because typically the don’t want to complicate the equity position with share options and so on.
In fact I think family businesses, good ones, don’t need to be so defensive about this, I think they’re very attractive employers.
I think a lot of senior people in business have got very tired of the public company circuit, have seen through the essentially lotto ticket type approach that co driven compensation from a public company drives them to and I think a thoughtful family business that’s thought through clearly how its going to relate to a senior management person can offer a very attractive package and I’ve seen them hire some very, very attractive people, very good people.
In terms of a family business looking outside the family for guidance I think there’s an extremely valuable role even in a family business that’s still family managed for a strong non exec team on the board. Families find these individuals with strong business experience who get to know the business, get to know the family just invaluable in helping them guide through some of the issues they face and that’s an arrangement that works extremely well in almost every circumstance that I’ve seen where the right people have ended up on the board.
How easy is it for a family to reach out beyond that for advice? Well it’s a big step for some of them sometimes and I think it needs to be to advisors that understand the environment. I think for a family business to be talking to advisors who don’t understand what’s different and special about a family business can be a very difficult process but quite a large reason to find a good one.”
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Duration : 0:2:39
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If I owned my own …
If I owned my own business I don’t even think that I would involve family at all. Separating business and pleasure I think is the key.
Not a huge fan of …
Not a huge fan of totally family owned businesses myself. It’s good to have a bit of a mix of family and non-family.
What line of …
What line of business were you in jittyslitter if you don’t mind me asking??
it was lots of fun!
it was lots of fun!
I have worked in a …
I have worked in a family business with my Dad before and absolutely loved it. However I wasn’t part owner of the company, and things didn’t really work out in the management side of things.
I agree with you… …
I agree with you… I don’t like the idea of totally family based business either, a mix might work..
I guess there are …
I guess there are arguements for both sides…I personally don’t think I could work effectively with family alone!
I agree, makes you …
I agree, makes you consider things a bit more.
Sound advice once …
Sound advice once again
Fresh, new and …
Fresh, new and different but not weird would be a few good pointers to work around, when thinking outside the box.
sounds like a great …
sounds like a great movie
Also needed when …
Also needed when people’s approach gets stale.
A different point …
A different point of view lets you think outside the box and in today’s ever changing world we really need to do that a lot.
A different point …
A different point of view is always good, food for thought.
I reckon in any …
I reckon in any aspect of life, getting the advice of “outsiders” is really useful.
Last family …
Last family business i worked in ended in divorce, saucy affairs, and bankruptcy! Lucky I was only the chief bottle washer
Interesting …
Interesting thoughts here – nopt least of which how attractive these kinds of busiensses are as employers.
I agree entirely. …
I agree entirely. The other side of having a family culture and set of values at the heart of a business is that this can breed insularity and myopic vision. All good governance codes stress the importance of non executive directors, and avoiding the concentration of power into one individual. Family business should consider this as part of their risk management.
businesstvAmanda ,I …
businesstvAmanda ,I agree that family often has best interest at heart but sometimes they get business matters too mixed up with personal matters and that can be detrimental for their business. However there are a lot of family businesses who do how to keep the two issues seperate and thats why they are successful. Take TATA and Donald Trump for example who know how to maintain that balance.
That is a very …
That is a very valid point businesstvandie – however i still think that family often have your best interests at heart
I agree …
I agree businesstvAndie. People with outside logic brought into a family business can help to give the families involved a fresh perspective about the business they are dealing in.
I think it is …
I think it is extremely important to have this outside advise.
It is so true that …
It is so true that some family businesses can get personal matters and business matters so mixed up, that it might actually be good for them to have non family members onboard.