Did you know family-owned businesses employ 60 percent of the American workforce and create nearly 80 percent of all new jobs?
A family with its own business sounds kind of like instant job security.
But if you work for one of the 5.5 million family-owned businesses in the U.S., you know it’s not that simple. Whether your kids will take over that business someday is a decision with big questions to address and lots of moving parts.
Is working for the family operation a smart move for your teen? For your family? For your business?
You’ll need to consider more details about your teen getting into the family business as they get older and closer to working age. For now, here are some dos and don’ts to think about:
Working for the family business has pros and cons, so be open with your children by discussing the realities. Positives to share include the chance to:
Often children don’t want to work for a family business because of the downsides involved, including:
Communicating early and often to discuss your teen’s questions and concerns is the name of the game.
Your family business may have a proud history built by successive generations of hard work. Or it may be a relatively new business that you’re eager to continue to see thrive. But businesses today are at risk with each passing generation, with second-generation companies surviving at a rate of just 30 percent. Why? Younger generations pride themselves on individuality in choosing their careers. Kind of makes sense to us! After all, just because your great-grandfather had a knack for plowing fields and harvesting berries to make jam now sold in retail stores nationwide, doesn’t mean your kid has a passion or aptitude for it. You have an obligation to your company’s employees and other stakeholders to plan for the company’s future, but you don’t want to burden your kids with the responsibility to run your business. They need the freedom to choose their own career. (BTW, this last part works both ways: you are not responsible for mapping out their career either!)
Get your child involved in the business without it being forced upon them -- instead, find a way to tie a facet of your business to their natural talents. Maybe your family runs a company that makes organic snack foods. If your kid is a creative type, ask them to evaluate new packaging designs or seek their input on product development. If your teen is a problem solver, tell them about a challenge the company is facing in its operations and ask them how they’d suggest handling it. If he or she loves researching, ask them to dig up information about a specific geographic market you want to target in your sales efforts. Whatever you do to expose your teen to the business, keep things natural and positive. Teens are always yearning for more independence, so don’t stifle them with too much company talk. Know your kid and watch for cues when the business stuff has gone too far.
A sure way to kill your kid’s motivation and personal goals? Letting him or her believe the family business is a safety net. Many experts in family business consulting recommend having kids work for another company for several years before letting them work for yours. Not only does this allow your child to spread their wings, but it gives them some much-needed credibility within your operation if they decide to come work for you.
Your teen may have some specific short- and long-term goals for themselves—or they may not be at all sure where they see themselves in five, 10, 15, or 20 years. This is no big deal if they’re heading to college and have time to explore their options, but you may be thinking about long-term succession planning. If they don’t want to work for the business, then this is part of a goal’s discussion. If they do plan to get involved, then you’ll want to discuss how to integrate their personal goals into the company’s goals. One way to make taking over the family business more enticing is to promote adding their footprint into it!
If you’re counting down the days until you hand over the keys to the biz and retire to Florida, just remember—it’s more than likely your kids will want to do things differently than you. Your teen has different strengths and skills to bring to the business, and they may want to take it in a different direction. Plus, they aren’t starting a business from the ground up, so they may do things you weren’t able to. Before you pack up the house for Palm Beach, be sure to understand the reality of this and have those necessary talks.
If your son or daughter has expressed an interest in working for the family business, it’s never too early to teach them the ropes. Most businesses are well suited for your teen to do some type of training while in high school, such as an internship program or a more informal arrangement, like sitting in on an executive education program or shadowing one of your employees for the day. You may also want to find your teen a mentor within the company to provide guidance and a fresh perspective on the business. This allows for some healthy distance between you and your teen and will teach them how to act professionally.
Whether your child takes over your family business someday is a big decision—and one that ultimately, he or she should arrive at with your guidance and support, but on their own.
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