You don’t have to own a family-run business to run your business like a family. It’s quite common in modern UK business culture to take a more personal, close-knit approach to the culture of an organisation over a more distant, strictly-professional approach.
But what are the benefits of this? Is creating a family-like atmosphere for your business the right thing for you and your company to do?
Here we will discuss some of the pros and cons of this approach, which may help you to decide whether a family-like atmosphere is the way forward for your business.
Consider Your Market
Before you decide to go ahead and switch up your business structure and environment, you should first consider the market that your business is involved in. Essentially, you want to be sure that this change will be appealing to your clients, customers, shareholders etc.
Family-run business certainly carry more appeal in some markets over others. For example, there are many very successful businesses in the food industry, as well as in the manufacturing industry, as these markets are generally welcoming to this kind of business structure and environment, however this may not be true for every type of business.
Number of Employees
One of the main things to take into account when thinking about switching up your business culture is the amount of employees in your business, and how integrated everyone is in your current structure. Generally speaking, family-run businesses tend to be quite small in terms of number of employees, which facilitates the kind of environment they often operate in. Taking this into account, operating on a family-like structure in a business with a large amount of employees could prove to be difficult.
Of course, the transition to a close-knit, family-like organisation culture should be a lot smoother and more natural if you’re employee count is low, and employees have a good level of familiarity with each other.
However, if your business is large, maintaining a family atmosphere can be challenging due to the sheer amount of people.
One option in this scenario is to outline divisions or teams of your business, and run each one of them like its own individual family. This may assist in making culture and structure management easier, as well as having the added benefit of allowing your divisions to interact, cooperate, and compete with each other. One possibility is allowing your different teams to have their own unique identity and environment.
How Business Operations Might be Affected
You should also consider how day-to-day and long term business operations may be affected by the choice to run your business like a family. This can affect many aspects of operations, such as general communication, discussion/agreement, networking, and so on. By creating a family-like atmosphere and structure for your business, you're often encouraging employees to work more closely together. This can promote more in-depth discussion and collaboration.
By encouraging employees to treat each other like family, you're also encouraging agreement and friendliness during business discussions, which can be both a positive and a negative. On one hand, this tends to lower the chances of disagreement in the workplace. However this is not always a good thing, as employees might display less integrity and independence.
Over all else, this change one of organisation culture, meaning there will of course be a large effect on your business environment and the atmosphere of the workplace. It’s good to have an idea of what your ideal business culture would be, and the steps you can take to achieve this.
Family-like business cultures also tend to promote transparency and cooperation over traditional business models, which can help to smooth day-to-day operations and create more clarity. This can keep everyone on the same page, potentially increasing productivity and quality of output.
Also think about how this change may affect your company’s hierarchy and how team members interact and work with each other.
Effect on Employees
You must also consider what affect this change will have on your existing employees. For instance, if an employee is used to working in a standard business structure, they may find it hard to adjust to a more family-like structure. This could impact both their performance, as well as the performance of those around them and related to them, for example their team.
For this reason, changes should be implemented gradually and all workers should be clear about how they will be affected by such adjustments. After all, transparency is key to a successful family-like business model.
Can it be Successful?
The important question is, how successful can a business structured like a family be? Well, this depends on the existing culture of an organisation and client / customer-base. When operated effectively, switching business structure to a more family-based model can lead to success. The key is having a good understanding of your market and your current company structure. This can be especially effective if you conduct some clever PR and marketing, as ethical family-run businesses can often have a distinct appeal to certain types of customers and clients.
Levels of success of course also depend on your current existing business structure and the market. Research other businesses in your sector such as your competitors, to try and identify if any have a family-like structure. Can you identify any trends? Is there any correlation between successful businesses in your industry, and ones run like a family?
It’s possible that you could potentially find a niche within your market by making this change, however remember that this kind of structure may not necessarily create much appeal in some sectors.
Continuing from this Public Relations standpoint, one important thing to consider when deciding whether to make this change up is how your business’ public image will be affected. Generally speaking, people enjoy doing business with companies who they perceive to be more ethical. One of the ways to appear more ethical and customer/client-friendly is by positioning your company as a big family where both workers and clients are supported and cared for.
Often businesses that operate in this way take advantage of their higher ethical practices by publicly displaying their key values or principles. Being proud of the company values you uphold, in addition to operating on a family-like structure, can be a highly effective method of generating a strong public image and attracting new business. It may also gain you an advantage over your competitors.
Also consider how this change in business culture and structure will affect the senior managers team and how employees would be managed. For example, how will the gap between employees and management be maintained? As we touched upon, family-like structures can have a great effect on employee morale and engagement. However, this can also be damaged if the gap between management and employees is too large. Ideally you want to strike a balance in which there is a clear hierarchy and management system in place, and also a good level of understanding and communication between all levels of the business.
Morale and Employee Retention
Of course, choosing to run your business like a family over traditional methods will likely have a significant impact on your company morale. For example, often operating on a family-like structure can create a more relaxed, familiar environment, which can go a long way to improving employee engagement. By creating a family-like environment, you’re employees may feel more invested in the business and in their work. This can lead to greater levels of enthusiasm and heightened productivity.
Hightened morale can also assist in employee retention. For example, if your business has some highly talented senior managers, chances are they will be in demand at some point, perhaps by competitors. By treating these workers well, like a family, they're much more likely to feel comfortable in your business and therefore stay instead of jumping ship.
Remember, business environment and atmosphere can be a huge selling point when it comes to not only retaining employees, but also attracting new talented individuals to your company.
Managing the Gap Between Personal & Professional
One of the main downsides of operating like a family is managing the gap between personal and professional matters. Many family-run businesses have difficulty keeping family matters out of work, and work matters out of home-life. The same applies even if your business isn’t actually family-run. Close familiarity amongst employees can indeed improve morale, but can also sometimes complicate business matters.
Should you choose to run your business on a family-like structure, you should be sure to take this possibility into account to avoid unnecessary tension in future business discussions and day-to-day operations. If you choose to go down this path, it’s a good idea to lay down rules or guidelines to prevent personal matters and professional matters from interfering with each other. The last thing you want is for employee familiarity to backfire and cause tension or divisiveness within your team.
Generally speaking, one of the big bonuses of family-run businesses is the streamlining of the succession planning process. This is because it’s common practice for owners of family-run businesses to appoint family members as their direct successors, often children or similar relatives. This allows the business to stay in the family, as well as to continue being run by someone with a deep knowledge of the business and its structure. This succession planning process can also be employed with non-relatives should you decide to run your business like a family. Similarly, you may choose to nurture some of your employees with the aim of appointing them as your successor.
Succession planning is easier and less stressful than recruiting your next Managing Director from outside of your business, however is also subject to bias. For example, personal preference can sometimes cloud judgement when it comes to determining a candidate’s suitability as your successor. Make sure that you choose your successor based on ability, expertise, and business knowledge rather than personal preference.
Should You Run Your Business Like A Family?
Ultimately, the decision of whether to adjust your organisation culture and run your business like a family depends on your current structure, management, and ideal company image. Adjusting the culture of an organisation can be a big advantage from a PR and marketing perspective, and can also help with succession planning and company morale. However, on the other hand there is also the possibility that it may cause blurred lines between personal and professional relationships and interactions, make management harder depending on your employees, and depending on your market may risk making your business seem less professional.