Working with family members presents unique advantages, and unique challenges. If you’ve built up your own business, now might be the time to bring in other family members. Here’s how to avoid some of the pitfalls.

The benefits of keeping it in the family

It’s unusual to see ‘Smith & Sons’ or similar business names these days. But that doesn’t mean the family business is a dying breed. On the contrary, family businesses are thriving. In a recent PwC report, three-quarters of family firms grew in the previous year. That’s much higher than the average for all business types.

Keeping your business in the family has obvious appeal, whether you work with siblings, parents or children.

  • Your family will stick with you through the hard times.

  • You know your family well.

  • You and your family often share common goals.

  • Working with family can be emotionally rewarding and satisfying.

But working with family can also get complicated. Family businesses can lead to emotional stress and arguments. They can even cause legal disputes.

So if you’re thinking of expanding your business while keeping it in the family, it pays to plan ahead.

Interviewing interested family members

You should always take the hiring process seriously. Interview each applicant – family and non-family – to find out what they can bring to your business. In particular, look for skills and experience that are different to your own. You’re less likely to argue if you have complementary abilities.

Make sure you create opportunities for people who have worked outside the family firm to contribute their fresh perspective and new ideas.

It’s important to be as objective as possible through all of this. Be honest with yourself. If you’re worried you could clash with a family member, don’t feel obliged to hire them. If you make the wrong decision, it could damage not just your business, but also your family ties.

Be fair to all your employees

Before you think about hiring more family members, spare a thought for those employees who are outside the family. As the business owner, you have a duty to be fair to all of your employees – not just your relatives.

  • Leave emotion out of your employment decisions.

  • Consider whether the family member will fit in well.

  • Don’t show favouritism to anyone.

  • Don’t pay family staff more than other employees in equivalent positions.

  • Promote your best people, whoever they are.

  • Treat all your employees equally and fairly.

This isn’t just an exercise in good moral behaviour. It’s important if you want to get the best out of all your employees. If you don’t treat your staff fairly, employees can become demotivated or leave, which will cost you money. Whether you’re related to your employees or not, treat everyone as members of your wider business family.

Set clear expectations with everyone

Imagine your cousin hasn’t worked for 10 years and asks to be employed at your family firm. Do you take a risk simply because they’re family? Or perhaps you’ve employed your nephew, but he’s careless and unpunctual. What do you do?

If you want your business to thrive, you need to be as strict with your family as you would be with any other employee. Regardless of the size of your family business, unproductive workers can hurt its efficiency and reputation. Act positively and keep your business lean and efficient.