Question: How does one set up criteria for family members entering a family business?
All too often we think that just because our parents, siblings or other family members own a business, we have the right to work in that business and feel affronted if we are told that there is no position available to us.
In order to avoid such a sticky situation we, at the Entrepreneurial Management Center Business Forum, educate businesses about creating a family creed and/or code of ethics, a mission statement that can be drawn up by a family counsel, business owner or the board of directors.
We think doing so is critical, because the family creed is the instrument that denotes the criteria of how a family member enters and exits the business.
It also denotes the family’s values on how it is going to do business with its clients, with its employees, and how the family will conduct its own daily business.
It lays down how members of the family business should practice the basic disciplines.
It sets the ground rules by which all family members entering, participating and staying in the family business are to adhere to.
It specifies what education, experience and preparation are required to join the business.
It denotes how job performance is evaluated and lists the criteria on how titles and authority are to be determined.
To draw up such a document takes time, because each family-run business has different values and a different vision.
First, you have to buy into it and agree on those values and the vision, then you start drafting the document.
For more information on seminars and forums to help educate business owners on how to draw up a family creed, contact the author of this article.
Written by Carmen Bianchi, director of the Entrepreneurial Management Center Business Forum for Closely Held and Family Businesses at San Diego State University. E-mail: firstname.lastname@example.org.