Involving family in a business

Section 2 : Cons of involving family in a business

We all have experience with dysfunctional families, either our own or someone else’s. Sometimes the people you’re closest to can be bad for you. You may not want that anywhere near your business.

Trust cuts both ways
Because you trust your family it may be easier for them to take advantage of you. You may not look for the signs of deceit as carefully as you would with someone you don’t know. You might assume they’re doing the right thing and never check to make sure.

Family members may also be more inclined to break the rules because the consequences aren’t as severe as they would be if someone else’s business employed the family member.

It can damage your relationship
They say you should never loan money to friends with the expectation of being paid back because it could ruin the friendship if they don’t. The same can hold true for family businesses. If an outsider messes up something badly, you fire them and move on. But with a family member you have to continue living, and possibly working with them.

You may lack an outside perspective
Family members often see things the same way. This can make thinking “outside of the box” difficult. When faced with a difficult problem, it’s usually helpful to consider multiple perspectives because you never know where the solution might come from. With family members, those additional viewpoints may be absent.

Comfort can breed complacency
Working with your family might be too easy. Members might get excessively comfortable, knowing there’s less chance they could be fired and fewer opportunities for advancement. This reduces their drive to improve the business or think innovatively.

Other employees may not get a fair shake
When you work with family members, they tend to get preferential treatment. They can’t be fired as easily as regular employees and may take advantage of their positions. This can upset other employees that aren’t related to you. It can be a difficult balancing act trying to ensure that every employee, both family and not, are afforded equal treatment.

So should you involve family in your business? Hopefully, this article clarifies the possible benefits and hazards so that you can make an informed decision.