St.Louis Business Journal
SHOULD YOU HIRE YOUR KIDS TO WORK IN THE FAMILY BUSINESS?

By Anna Navarro

February 2005  

Author's note: Case studies in this column are essentially true stories fictionalized to protect privacy and told with the individual's permission.

Hiring your children to work in your business is an appealing proposition to many people. It can be gratifying to work with people you love and to pass down a living legacy. But family businesses can also be full of landmines that can wreck the viability of the enterprise and injure the individuals involved.

If you are considering the possibility of hiring your offspring there are some important questions to ask yourself first.

1. Is the young family member truly interested in the family business? Interest based largely on a desire for quick advancement and high pay can lead to future business and relationship problems.

2. Is the young person capable of making a contribution? As with any employee in a well-run organization, this means assigning younger family members responsibilities consistent with their experience and training, setting goals, giving them honest feedback and providing the opportunity to move up the ladder ONLY if their performance merits it. Remaining objective through this process of discerning a young person's abilities requires a great deal of detachment.

3. What if the relative doesn't perform well? Will you be able to ease him out of the organization without creating ill will in the family? Would he accept a lesser role in the company and do so graciously? This is a difficult task in any organization even with non-family members.

4. Can you navigate the potential jealousies and judgments of non-family employees? Some of these employees may be key to the future of the business. And they may be just as qualified as family members. Yet they may have fewer opportunities because they are not relatives of top management. Can you find ways to retain and motivate them?

5. And the biggest question of all is one that has to do with you. If your offspring is willing and capable of taking over the family business - will you be willing to step aside? When the time is right, will you actually be able to let go of control and hand over the reins? That question deserves considerable self-reflection.

Sam's oldest son, Victor, had grown up assuming he would someday inherit the small chain of carpet stores Sam had founded. Victor was an intelligent young who did well in school and approached life with vigor. A year before Victor graduated with a BS in Business, he and Sam had talked and agreed Victor would start full-time after he finished school. It was a year when jobs were scarce for new graduates, and Victor was glad he didn't have to struggle to find employment, like his classmates.

Sam's plan for integrating Victor was straightforward: Rotate him between departments so he can learn the business.

Victor started in the institutional sales department. He found the work frustrating. He had to tote heavy samples and do a lot of detailed work on quotes. Customers took a long time to make decisions and then sometimes decided to go with another company.

After a few months he asked his Dad if he could move into the marketing department, which was responsible for the advertising and point-of-sale displays. This he liked better. But within a year he started to butt heads with the marketing manager.

He wanted to change the way things were done, and was meeting with resistance from his boss. Sam, who greatly valued the marketing manager's judgment and contribution, found it difficult to give his son honest feedback about the impracticality of his ideas. So, instead, he glossed over the problem and moved him to another department.

But the same issue continued to crop up. In every one of his training assignments Victor became impatient with his boss, insisting on introducing new approaches. If Sam sided with the employee who was managing him, Victor accused his Dad of being backward and unwilling to improve how the business operated.

Sam began to realize that Victor might not be cut out to take over the business. Eventually he had to ask his son to leave. Victor's impact on the business was very disruptive, and Sam feared if he continued on he'd ruin the company, his own inheritance and his parents' retirement.

The experience was very painful for everyone, and especially for Sam, who had always tried to do what was best for his son. He realized too late that to be successful at integrating his son into the business he would have needed to manage the process of introducing him into the operation very differently.

Anna Navarro is the founder of Work Transitions, a nationwide career consulting firm that trains independent career strategists and consults with individual clients.

This column was originally published by the St. Louis Business Journal. The actual title of the column and date in which it appeared in the Business Journal may be slightly different from what appears on WorkTransitions.com.