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Family Business Matters       07/15 12:02

   Trusted Outsiders Can Add Value to Family Business

   Non-family members can bring out the best in your closely held company.

Lance Woodbury
DTN Farm Business Adviser

   Family members in business together face unique challenges stemming from the 
nature of their relationships. Parents are, at first, authority figures who 
raise children then work side by side with them as colleagues in adulthood. 
Siblings who have grown up together in a social context later interact as 
coworkers in a business environment.

   The transition as family members into business partners and the assumptions 
and expectations that come with having a family relationship can lead to 
communication challenges, poor treatment of one another and even conflict. In 
short, being family can sometimes bring out the worst of people in business 

   One way to minimize the negative drama of family members in business 
together is to engage people who inspire the family to better behavior and 
results. The presence of someone who wasn't raised in the household, doesn't 
have a long history of interaction or isn't dependent on a family relationship 
can cause family members to interact differently. Consider the following types 
of outsiders who can add value.


   With today's tight labor market, when you have a non-family team member who 
performs well in the business, you want to do everything in your power to keep 
him or her. A business in which people don't communicate or family co-workers 
treat one another poorly creates a difficult work environment. Granted, every 
business struggles with communication, and the "grass is always greener" 
somewhere else. But, if there is visible conflict among family members, you run 
the risk of encouraging your best workers to look elsewhere for long-term 
career satisfaction.


   The key advisers to your family business -- your accountant, wealth manager, 
lender, attorney and possibly even your crop adviser, veterinarian or livestock 
nutritionist -- can offer a perspective that both includes and goes beyond his 
or her technical expertise. They see other family-owned businesses and often 
spend time in a more professional atmosphere. Having those advisers participate 
in family business meetings can focus the family on business issues. 
Furthermore, family members often don't want to embarrass themselves in front 
of outsiders, so they behave differently with advisers in the room.


   As family agriculture businesses become more professional, they often turn 
to advisory boards and peer groups to help in the journey. These are other 
business owners and friends who have faced, and overcome, similar challenges. 
Talking and listening to others who have "been there" can be very helpful, even 
therapeutic. Just like an athlete tends to perform better because of a coach, a 
family business can perform better by heeding the wise counsel of peers.


   While in-laws might technically be considered family members and bring a 
different set of challenges, they also have the benefit of not being raised in 
the same household. They bring a different style of interaction and a different 
way of handling conflict to the culture of the family business. They can 
sometimes bridge differences, suggest alternatives or see opportunities the 
family members might not grasp. The right level of interaction with a skilled 
in-law can help the family business improve.

   Better performance in the family business takes effort on several fronts. 
Financial strategies, operational excellence, technology investments and labor 
strategies all have their place. But, if a fundamental indicator of success is 
the working relationships among family members, a trusted outsider in the form 
of an employee, adviser, peer or in-law could make all the difference.


   Write Lance Woodbury at Family Business Matters, 2204 Lakeshore Dr., Suite 
415, Birmingham, AL 35209, or email

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