Owners of a family business know it’s almost impossible to separate the family from the business. At Bartlett, we offer strategic wealth management advice for families whose wealth spans beyond three generations—and in many cases, that wealth comes from a family business.
In a perfect world, business owners could grow the business over their lifetime, providing enough money to achieve their family’s financial goals, and then seamlessly transition the business to their children to continue growing it according to a unified vision.
But of course, we don’t live in a perfect world. In reality, there are countless gray areas and moral conundrums family business owners must navigate, all while keeping the peace and maintaining harmony—something our clients often cite as the most important goal for their family.
Here are just some of the serious questions Bartlett advisors hear from clients managing a family business:
- What do I
do when a family member is underperforming at work? The simple answer is
one that’s hard for many family business owners to hear: You may have to
terminate their employment. Firing a family member is an incredibly hard task
that, if not handled delicately, can cause rifts and bitterness in the family
- Should I treat
my children equally even though their skills are different? It’s a simple
fact that members of the same family often possess vastly different skill sets,
experience, and work ethic. When rewards and recognition reflect that, it can
cause strife, especially between siblings, prompting arguments over what over
what is “fair” and “equal.”
- How can I
avoid nepotism or the appearance of nepotism? Nepotistic practices can
easily creep into day-to-day operations if an owner is not careful. Two perfect
examples: promoting a family member to a position they are not qualified for,
and routinely overlooking poor performance.
- Is it possible to separate work life from family life? Work-life balance is tough for most people, but particularly for family business owners, who must learn to delegate responsibility, set boundaries, and empower those around them to handle decisions in their absence.
At Bartlett, one of our top recommendations for family business owners is to be proactive. First and foremost, they must establish parameters for determining who is eligible to be employed in the family business. It’s a difficult task, and for that reason, some owners ultimately decide on strict policies against hiring family.
Whatever you decide, be sure to talk with your Bartlett advisor, who can help you create a solid strategy to protect and grow your family business well into the next generation.