I must say that being a family business advisor has taught me so much as to how to go about conquering insurmountable challenges and trying to help deliver win-win solutions, which are sustainable for the longer term and deliver value.

So below are a few of the things I learnt to expect from most family businesses:-

1. They are runners on the spot: Most family businesses are focused on yesterday and today. Few actually focus beyond tomorrow. This means that their time is stretched too the limit in tackling daily operational issues and have little to no time to look ahead and around them, to understand how their business landscape is changing and how this will affect their business. They operate whilst hoping that what worked in the past will work in the future. Planning is something they hope they will do one day (like the free drinks tomorrow joke), whether it is business & strategic planning or succession planning. Whether it is a small family business with a few employees or a big family business with hundreds of employees, a level of micromanagement is always present. The route of this evil (micromanagement) is always the same – trust issues.
2. Patience, Patience, Patience: Bringing about change, especially mindset change, is a long and winding round. It requires a lot of patience and the ability to celebrate even the smallest wins. However, change will need time, tactical pushing and a lot of preaching.
3. Lack of Proper Governance: A sizeable chunk of family business lack the necessary forums and governance culture. Decisions are taken by a single person or a small group of persons, with no proper checks and balances. This obviously creates issues with regards future planning especially succession planning. So you need to patiently work to slowly build the structures needed on the path to improving governance within the family business.
4. They have a problem with data: Most family businesses have a problem with data. Some just do not capture it. Some capture it, but do not know who to drive any sense out of it. Others capture it, analyse it, but just want to keep all data to themselves, without realising that they need to use that data to persuade team members. Whatever the case their is many times the lack of a data driven culture, where decisions are grounded in what the data is telling us.
5. No processes: Processes are things they know, stuck in someone’s head, but rarely written down and analysed. Most family businesses are surprised when presented with the huge inefficiencies and single point of failures their processes have, when these are just laid down in front of them. The thing gets more interesting (& complex) when they realise that they have been for years making up for inefficient processes by employing more people. This gets more complex as businesses grow. Add to this that most family businesses grow or want to grow, whilst not achieving the right balance between growth in processes, systems and people to sustain such growth.
6. Investment in Property & Machinery (YES), Investing in Systems & Technology (NOT Really): Many family businesses have used past profits any invested them in property or machinery. However they are more reluctant to invest in streamlining processes and in systems that can increase productivity.
7. They are likely to be more resilient: The are likely to have more patience in supporting any business function that is not producing the desired financial results. This is many times as two way street. On one hand it is a big plus as family business are likely to allow a business function to blossom, on the other hand it could be a big minus if family business attach themselves to business functions that keep destroying value.
8. Some decisions just do not make sense: When viewing certain decisions in family business, they just make no business sense. However, if you are experienced to see the emotions in the equation, you will understand why certain decisions have been taken. Having said so, when such decisions are taken with too much weight given to such emotions, the family business will suffer. Family business need to create a balance between the needs of the family and of the business.
9. Compromise on Meritocracy: In some cases, family business compromise on meritocracy. With decisions taken either to create equality or favouritism. It both cases, a lot of harm and friction is created. Persons in family business, whether family or non-family, need to be rewarded and valued according to their contribution.
10. Lack of appreciation of the Power & Importance of Culture: Most family business owners grumble about the effects of their internal weak cultures. However, they rarely give enough importance to how to effectively build a strong culture and invest the necessary time and money to train people in a way that mindsets are aligned around the culture the family business needs to grow.