Encouraging Your Children to Carry On With The Family Business
The recent resignation of Steve Jobs from his CEO position at Apple for health reasons had me thinking about what would happen to a company when the founder is too old or too sick to run it.
For most entrepreneurs, it is their hope that one or more of their children will carry on the business. Parents may think that their children should be thankful to have a business to inherit. Unfortunately, children do not often share the same sentiment. This may come as a shock to some parents, especially if they have never had a good discussion with their children regarding the matter. Oftentimes, children end up not voicing out their reservations because they fear disappointing their parents. It is best that you initiate the process, but before you do this, it may help if you read below some of their common concerns:
Things that make your child wary of your business:
• It does not look nice. An acquaintance of mine refused to follow his parents’ request that he manage their store in Divisoria. It is a big wholesale operation that earns millions. However, he is disgusted with the ambiance of the workplace. There is no air-conditioning and the smell and sanitation is terrible. Although he would earn far less, he decided to just take an office job with a multinational company.
• It seems like too much hard work. You might have a tendency to boast of what you have gone through to set up your business and what it takes to run it now. Perhaps you go to work really early and go home when it is already dark. You may be working even when you arrive home and also on weekends. Perhaps you have too little time for your family, and your child has decided that this will not be the way he wants to raise his own family.
• They are not that talented in business. Many entrepreneurs have tremendous skills that enabled them to start, grow and manage their business. Unfortunately, your offspring may not be in the same league as you. It may be that they cannot match your capabilities and so they suppose they cannot manage the business.
• They believe you will interfere too much. While you may promise not to interfere, it is almost certain that you will. Not being able to make their own decisions is one of the prime reasons to look for work elsewhere.
• The compensation is too low. A long time ago, I had a friend who worked in their family-owned drugstore who told me that he planned to look for another job because, after working for many years and being very frugal with his expenses, he still had no savings. This struck me as incredible because the store is one of the largest and most profitable in the city. This may seem like a surprise to some, but there are parents who pay ridiculously low salaries to their own sons/daughters. They justify this by saying the business is theirs anyway.
• They want another career. For many people, money is not the primary motivation. They just want to do what they are passionate about. The only problem with this thinking is if the career they want would likely end in starvation.
What you should do to motivate your children
• Improve the working environment. Make your store, office or factory a pleasant place to work in. Invest a reasonable amount to renovate and upgrade the place. For example, it will help productivity a lot if you could provide air-conditioning.
• Fix the scope of your interference. What you can do is to have a frank discussion with your child and agree upon a written list of the instances wherein you have a say in the decision-making and the situations that are hands-off. This agreement is vital to counter the strong urge to interfere.
• Provide market rate compensation. It is only fair to give to your child at least the salary you would give to outsiders. This way they would be able to amply provide for their needs and be able to budget properly.
• Know your child’s capabilities. You must try to honestly assess if indeed he/she has what it takes to run a company. Being an entrepreneur entails a lot and not everyone is qualified.
• Inject pragmatism into their career choice. If your child decides to be a doctor instead, then you need not worry about his/her financial future even if he/she does not go into your business. However, if he/she wants to be a movie star then perhaps you can convince him/her to first finish a college course first that can serve as a fall-back.
Finally, plan for the eventuality that none of your children will continue your business. Sometimes, for many reasons beyond your control, your children just want other careers. Do not condemn them for they are well within their rights to make their own decisions. But you should know their plans far in advance in order to groom some other person, or to prepare for an orderly sale or liquidation of the business.
*Originally published by the Manila Bulletin. Written by Ruben Anlacan, Jr. (President, BusinessCoach, Inc.) All rights reserved. May not be reproduced or copied without express written permission of the copyright holders.
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