10 Most commont mistakes of family businesses and how to avoid them

10 majors mistakes on family businesses and how to avoid them

Most common mistakes of family businesses and how to avoid

1. Trying to change everything at once, bypassing resistors family members with more seniority.

SOLUTION: “Change must be done with firmness The key is to make it so that the structures do not suffer.”.

2. Delaying the introduction of innovations critical because of the difference of opinions among family members.

SOLUTION: The market waits for no one. You must negotiate and lead the change to achieve the implementation of innovations. You have to “sell” the benefits the changes for the company, and do it in a professional manner, with data in hand.

3. Lack of leadership.

SOLUTION: While you have to hear 20 times “how well” they did your father or grandfather, nothing justifies the failure to take the reins.

4. Settle for what you get. Try to retain customers that are inherited by offering the same products or services “lifetime”.

SOLUTION: You must strategically plan the growth of the company and to do it well, you need market research that allows you to make decisions about which products to keep in your offer, what must change and what new should be incorporated.

5. To perpetuate the policy of “benefit sharing” and have a conservative investment policy.

SOLUTION: Many family businesses are drowned in the old system to reap the benefits and spread them among the family. The problem is that the implementation of innovations requires investments. Access to venture capital partner can be a solution for companies that do not have resources to innovate.

6. Try at all costs to preserve the “idiosyncrasies” and defend to the hilt the total independence of the company

SOLUTION: If the company does not have enough tools to compete in the market at an advantage for example, for lack of financial resources, technology, know-how, etc., do not dismiss the possibility of establishing links with other companies. The formulas ranging from fusion to joint ventures or alliances.

7. Prioritize family ties in the organization.

SOLUTION: The first step towards the professionalization and innovation is changing the culture of the company. It is necessary to introduce changes that allow posts and designate roles wisely.

8. Confusing property management business.

SOLUTION: If you have become the owner of the company you should evaluate your skills to direct and implement all the changes needed. If you have to abandon the leadership and put forward a more capable person, please do so.

9. To perpetuate a communication policy based on informality and secrecy.

SOLUTION: You must implement an internal communications plan to systematize the information flows in all directions (upward, downward and horizontal). The fact that certain posts are occupied by relatives should not prevent the rules established in the plan are followed.

10. Choose poorly competitors and keep a close view of the market.

SOLUTION: You must abandon the belief that our competitor is “the company, or the family front,” since it is one more way to stagnation.

And Again, Whatever the size of the company, it must conceive a broader market space, where competitors lie outside of the town, the province and even the country. You need to widen your vision.