Even though family businesses often struggle to find talented employees who will stick around, many entrepreneurs don't realize they have exactly the talent they're looking for in their own children. Each spring, I listen to undergraduate and graduate students trying to decide whether to join their families' businesses. It's not just a sense of obligation that is driving them. Many really want to work with their parents, but worry that challenging and rewarding work isn't an option in the family business.
So how can you make your company more appealing to the next generation? Treat your offspring as other professionals would. Here are some steps that will help forge an arrangement that is good for both your children and your company.
First, be willing to talk with your kids about what they truly want. I call it "the wish." Find out what your children hope to find in a career, and then work with them to turn their vision into reality. Laura McKeon's father had no inkling that his daughter wanted to work in the family's small appraisal business in Bedford, N.H., and help it grow. Laura, in turn, was surprised that her father was already thinking about other businesses he could launch in real estate. Now the two are working on a vision for the company's future.
Second, do some business planning. Members of the next generation want to know where the company is going and how they might help get it there. Maggie MacDonald was excited when her father agreed to work with her to set up a management company to handle the family's real estate holdings. It was a perfect match: He wanted to step away from the day-to-day management of properties, and she was eager to get involved. Her father agreed to work with her to draft a plan for the Wrentham (Mass.) business that spelled out performance goals, job descriptions, new business development, and the role of other family members.
Third, talk about how to generate growth and wealth. Discussing money is difficult for many families, but business is about paying and rewarding people for their effort. Don't leave the subject of money to a "someday" conversation. Rodrigo Perez has a plan for how his family's transportation company in Mexico can diversify and grow, but he has concerns about salary and the distribution of equity among his siblings. Like many in his generation, he's waiting for his family to agree on these issues before joining the company.
Fourth, spend time developing your children's talents and skills. The next generation is a company's greatest resource, but it is often squandered. One student told me that on his first day on the job his father's directions were simply, "Go kick around and find something to do." Note to parents: That is not leadership development!
Jessica Schuler is seriously considering joining her father's insurance business in Nashua, N.H. But she worries that her father won't take her role in the company seriously enough to give her the leadership training and development she thinks are important. After explaining her hesitation to him, he's agreed to draw up clear development goals and schedule regular training meetings.
Finally, remember that being professional doesn't mean you can't benefit from a family business' greatest virtue: spending time with your family.
Timothy G. Habbershon is the director of the Institute for Family Enterprising at the Arthur M. Blank Center for Entrepreneurship, Babson College