What role do you play in the family and in the business?

Are you an owner, CEO, oresident, CFO, vice president of marketing or human resources, manager or all of the above — in addition to be being a wife, mother, stepmother, widow, daughter, daughter-in-law, sister and/or sister-in-law?

It is tricky to navigate all of the roles women in family-owned businesses fill. Even in 2015, the onus of childcare, housework, meal preparation and overall domestic duties falls to women. Juggling roles is hard and doing so within a family business brings its own unique set of challenges.

Indeed, how many women in family owned businesses have heard this? “Your brother can stay late, why can’t you?” To which, one of our next generation female leaders replied, “because I don’t have a wife!” Or, “I have to pay your brother more because he has a family to support” — even though the female family business member is married with children as well.

There are no easy answers

One way to mitigate confusion over a woman’s place in the family business is to discuss roles and expectations early, clearly and often.

This way, everyone is clear about qualifications and job descriptions and duties. Because these conversations don’t happen enough, the biggest hurdle for women in family owned businesses is earning respect. Women who enter their family business must work harder to downplay “daddy’s little girl” or “the boss’s wife” because the first assumption among many is that the women entered the business through blood or marriage, NOT through qualifications.

Language is a barrier, too. Small, seemingly innocuous words contribute to the inability of women in family-owned businesses to shed stereotypes and successfully juggle their roles as employees and family members.

For example, often when founders or the managing generation refers to the family members, it’s “the men” and “the girls.” This is automatically demeaning and puts the women on a lower level of perceived maturity as their male peers. One of our members had a vendor refer to her as “little lady.” She worked hard to ensure he did not keep their business! Can you imagine that same vendor referring to the founder’s son as “little buddy?” No. So, it should be equally unacceptable that he called the founder’s daughter “little lady.”

Here’s a few statistics to keep in mind:

  • 24 percent of family businesses in the U.S. are woman-led.
  • 31 percent of family-owned businesses in the U.S. are currently transitioning to become woman-led.
  • 60 percent of top management team positions in family-owned businesses in the U.S. are held by women.

That’s a whole lot of women navigating family roles, professional roles and the minefield that sometimes presents itself when the two collide in family business!

There are no easy answers on how to juggle roles

Women have been trying for a long, long time to get this right! My best piece of advice is to discuss and define roles, and to commit fully to the business and show your dedication by producing top quality work.

One of the hallmarks of family business is flexible work schedules, but do not fall into what I call the “unproductive trap.” It’s easy to drift away from work by taking advantage of a flex work schedule, not to mention your position in the family.

Utilize self-discipline to show others that you are committed to and engaged in the family business. This will go a long way to fighting stereotypes and to help you earn the respect of your family members and co-workers.

Until next time,
Bea Wolper

 

Bea Wolper is president of the law firm of Emens & Wolper Law Firm, where her practice focuses on succession planning, estate planning, oil and gas law, contracts and the buying and selling of assets and businesses, with an emphasis on family-owned businesses. She is also the co-founder of the Conway Center for Family Business.

Tips for setting up family business councils

Family business councils are important for many reasons, including discussing the future of the business, developing the vision for that future, discussing the central values of the family, discussing how such values relate to the guiding principles of the operation of the business, how to handle the wealth of the family business and how to bring the next generation into the business.

Family councils will help your family business determine where the business wants to go, who can help it grow and how the family business can get there. For succession, how does your family business bring children into the business? Does the founder want to work forever? How should you take care of family members both in and out of the business? That is, what is the responsibility to working family members in the business and what is fair? (Equal may not be fair, and fair may not be equal.)

Family business councils help your family business grow. We recommend that family business council meetings be held three to four times each year. Note that these meetings are different from advisory board and board of trustee meetings.

Who should attend these councils?

  • The working generation — all family members who are working in the business.
  • The decision-makers.
  • Spouses — this helps avoid the whispers. They should be included at least once per year for an overall financial review and discussion of upcoming issues and general state of the business. There should never be any surprises!
  • Children — once per year at age 13 and older at year end to discuss philanthropy efforts. A good way to get kids to engage in philanthropy is to designate a dollar amount to each child and then allow them to pick a charity of their choice. Some councils double the amount of money if the child volunteers at the charitable organization.

What are some structural items to consider?

  • Someone needs to take notes.
  • What are the planned meeting sessions versus other times just to get together to hang out as a family.
  • If the council is a retreat, does the company pay for it?
  • Councils should bring family together to celebrate family and the business.
  • Keep a history of the business. A written history is important.
  • Don’t forget to discuss the future of the business, such as:
    • Short term.
    • Life events.

It’s a good idea to include a facilitator, which can be one person with family owned business experience. This is particularly helpful when the discussion is focused on succession planning, including complications involved with the founder “retiring.”

Please remember, however, that this is not a business meeting but a family meeting whose main purpose is to facilitate communication and information exchange and to share plans for the future of the business.

How should you handle the spouse and non-“in the business” family members meeting?

This meeting should be separate and include business owners who do not work in the business. I call this the “Leaky Roof” meeting as it is a way to discuss issues faced by the business that will require financial attention and may therefore lead to reduced dividend or distribution payouts. Again, there should be no surprises and these meetings help head off disagreements between those family members who work in the business and those who have only a financial stake in the family business.

Until next time,
Bea Wolper

 

Bea Wolper is president of the law firm of Emens & Wolper Law Firm, where her practice focuses on succession planning, estate planning, oil and gas law, contracts and the buying and selling of assets and businesses, with an emphasis on family-owned businesses. She is also the co-founder of the Conway Center for Family Business.

Are you ready to bring the next generation into the family business?

Bringing children into the family business can be challenging and rewarding — a topic we discussed in the February 2015 meeting of the Women in Family Business Peer Group at the Conway Center for Family Business.

Here are some tips to streamline the process:

When and criteria

  • At an early age, show them that the family business is a positive thing, not just something to be complained about at the dinner table. Share the joys in your business as well as the complaints.
  • While in school, they should do some sort of job in the business and be compensated so they see some benefit or reward for working in the family business. Watch for passion — what are they interested in? What positions or tasks do they gravitate toward?
  • After graduating from high school they can still work, but you need to decide if they must meet minimum requirements to actually join the business. For some family businesses, children must have a college degree or have worked outside the family business for x number of years. Think about what criteria you want to establish for your family business and then implement it fairly.

Compensation

  • Fair compensation is important: no penalty for being a family member, but also no reward.
  • Pay for performance as you would any other non-family employee.
  • Do not play “someday this will all be yours”…

Expectations

  • Discuss expectations early and often. They need to know what they are getting into and what they need to do to succeed. This includes managing “name recognition” and how their actions — professionally and personally — reflect on the family business.
  • Family council meetings should be held before bringing children into the business.
  • Have a plan.

More Tips

  • Have buy-sell agreements in place. They must contain language that allows the owner/founder to “fire” the next generation if they do not meet expectations, even if you think your little “sweetheart” would never let you down!
  • Use first names in the office — not Mom and Dad or other endearments.

Until next time,

Bea Wolper