Family or Team? Can You Be Both in Business?

Many years ago when I was on the board of Kinko’s, we had a pointed conversation about our future initiated by John Davis, a board member and Harvard professor who specialized in family business. He believed we needed to change our culture from family to team. Even though we were a multibillion-dollar business, we were absolutely in the family camp at that point.

Family businesses — encompassing both “real” families and those that act like families — can be absolutely wonderful environments. They can also be a cesspool of dysfunctionality, or sometimes both! I’m talking about culture, not genealogy (although the gene pool often dictates the culture).

Family businesses range from Bob and Son’s Doughnut Shop to Ford Motor Company. There are many more on the Bob end of the scale than the Ford end. When it comes to size, the family characteristics that can be wonderful for a small business can be detrimental to the growth and continued success of a large business. 

To cut to the chase, when your love for Uncle Joe — who is your VP of sales — causes you to put up with less than desirable results, you’re stuck in family mode. Joe doesn’t have to be your uncle for this to occur. He might be your co-founder or college drinking buddy. But at the end of the day, your personal relationship is harming your business results. (Truth be told, the business relationship may be destroying the personal relationship as well.) Would you allow the business to fail rather than deal with Joe?

Frequently, the opposing forces are affection and performance. If you love your co-worker, can you fire him? Will he take direction from his brother or close friend?

This issue is very nuanced, but for simplicity’s sake, let’s contrast family with team. If you’re on a highly functioning, successful team, you can love your teammates, but it’s a meritocracy. Everyone must add value and pull their weight. They must put the organization’s success above their own or above their relationship with you.

As Dr. Davis wrote, the challenge is one of governance and leadership. For a family organization to optimize its results (in business terms), there must be alignment, performance objectives, and clear roles and responsibilities. (Just like any other business, you also need a clear strategy. What value are you bringing to the marketplace?) The fact that you helped me get through my college physics class may have helped forge our relationship but should have little bearing on whether you effectively do your job.

I believe you can have family attributes (e.g., love and respect) in your successful business but only if you also have alignment, performance objectives, and clear roles and responsibilities. 

If your business has more family than team attributes, you might have a wonderful setting that allows for wealth and enjoyment. That’s great! It might, however, mean that you’re well short of achieving what could be. If that’s the case, what must you do to move from a family to a team? What beliefs are you holding on to that may be keeping you from the right actions?

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