How a child’s path to college is like a family-owned business.
Most small businesses in America today start out with an owner that has an idea about how to make money. They start running the business themselves and wear all kinds of hats. The business grows and the owner is taking on more and more. As it evolves, the owner may incorporate family members to help along with hired employees.
Eventually, it gets to be too much for the owner, and he/she must make some decisions. Do I keep running the day-to-day operations or do I hire someone and let them run it?
It really comes down to your “why”. What drives you and gets you excited about your business? The passion you had when you started the business is what gives you fulfillment. Do you enjoy building the product, designing new ones, selling, interacting with customers, or something else? Is the business a means to an end, providing funds to travel or give back? Perhaps you are ready to enjoy retirement.
Not unlike raising a child and sending them to school, right? No two businesses are the same, just like no two children are the same. You take baby steps, learn along the way, make some hard decisions, and correct.
When you send Junior off to elementary school, you hate seeing them leave and you cannot wait for them to get home. You’re waiting to pick them up, make sure they are safe, and help with homework every day. You are very hands on while trusting the teacher for a few hours a day.
When Junior gets a little older and becomes more independent, you continue providing guidance but Junior starts to develop his own personality. Junior pushes boundaries to figure out who he is. Your level of hand holding is determined by how well Junior is making decisions and heading in the right direction.
Eventually Junior is goes to college or gets a job. Let’s assume you’ve provided guidance along the way and Junior has demonstrated maturation well enough to go to college and live on his own. What do you do now?
Letting go of aspects of a business is tough. Will the “kids” make the right decisions? Not always. Will you want to jump back in and help because you could do it better? Always.
The hard decision is whether you hire professionals and let them run the business you created, or to keep running it yourself? You will always be the owner and can provide guidance and control either way, but the best approach is to decide your role and stick to it.
If you want to remain a family-run business, you will eventually have to develop family members who can help you sustain and grow the company. Are they ready? Have you been developing them along the way? Is Junior ready to graduate from college or is he wanting to play in high school forever? Can you trust your business with Junior? If not, you have some work to do. Do not wait until retirement to develop your successors.
If you want to transition into a less hands-on role eventually, you migrate toward a family-owned business. You hire the right leaders, give them their parameters/marching orders, and support them along the way. Migrate to a CEO or Chairman’s role so you can hold them accountable for continued success.
The secret to success in either approach is not to cross the lines between family-run and family-owned. If you do, the staff will never support the leadership team if they know Junior is really the one with the power. Why? Because Junior always has Sunday dinner at the owner’s house, and they know it. It is not about running the business well as much as it is about making you and Junior happy while protecting themselves.
If you decide you’re ready for “honey, pack the bags, we’re out of here”, get a great leader that shares the values, the culture, and wants success for you and your family. Let them run it with your guidance and support.
Enjoy the next phase of life!
If you'd like to discuss further, contact me at www.richhallgroup.com/contact