A family business has the capability to outperform a Fortune 500 company. That jaw-dropping statement comes from Tom Hubler, a member of the LaManna Alliance and an expert in family businesses.
Tom will also be the first to tell you that the potential is squandered if the family business becomes dysfunctional, or runs into a stalemate. This scenario might be occurring with many of the smaller label companies that dot the North American landscape.
Alexander Watson Associates puts that number of label converters in North America at approximately 3,500, with a majority of these businesses under $1 million in sales. Many of these businesses are family owned, a fact which has contributed to their success.
Hubler notes that these family businesses can be extremely successful because of its tight emotional bonds. With a sense of caring for its family members and the overall good of the family, a business has added incentive to succeed.
This strength can also turn into a tremendous weakness when disagreements occur. When the emotional, family system begins to interfere with the function of the business system, significant problems will occur. It’s why Hubler stresses keeping formalized business functions in place.
When you have pre-established metrics, goals and strategies, there’s less room for potential conflict when things start to go wrong. But what happens if the wheels do go off and families start to battle? Hubler recommends the following steps to resolve a family conflict and move forward:
- Meet with a neutral party and determine goals for the family. With every family business conflict, there are heartfelt emotions and entangled alliances. Only an outside source can help mediate the situation.
- Create a formalized solution to attack the problem. As Hubler notes, when a family business conflict occurs, old emotional issues from the past tend to be rekindled. However, the root cause of these conflicts is that the formalized business systems are breaking down. The frustration then rekindles some of those old emotional problems, and the problem mushrooms. Finding a formalized solution on the business end is a great step toward attacking the root cause of the conflict.
- Establish shared family visions. Hubler advocates creating a number of visions for the family. They include a collective vision, personal visions, and a vision for other members of the family. Once these are established, you can work to achieve them, and strive to help the common good of the family.
Rock LaManna helps printing owners and CEOs use their company financials to prioritize and choose the proper strategic path. He is President and CEO of the LaManna Alliance, and provides guidance on how to grow a printing business, merge with a synergistic partner, make a strategic acquisition, or create a succession plan. Rock can be reached by email at Rock@RockLaManna.com.