Ideas & Opportunities

The size of the business does not matter: the same resentments and jealousies simmer or boil over whether the business is a small company or a conglomerate with a huge holding firm.

The resentments come to a head when the family fails to separate blood ties from strictly business concerns, according to Fernan Lucban, director of the University of Asia and the Pacific’s Entrepreneurial Management Program. “The task here is to make a successful shift from running a family business to building a lasting corporate organization,” he says. Family members can avoid conflict by agreeing on key issues such as the business’ direction, their specific roles in the company, and the rewards each of them may expect.

Mila’s Lechon matriarch Antonina Cesario credits discipline and a common goal for the success of the 30-year-old business with 37 stores in Metro Manila. A strong work ethic binds the siblings together. “Matagal na kaming nagne-negosyo,” says Cesario, 70, a pharmacy graduate. “Bata pa kami tinuruan na kaming lahat na magkakapatid na magtinda. May kaya ang mga magulang namin pero hindi kami pinayaman sa pera kundi sa disiplina, tipid, sipag at tiyaga. Kung hindi naturuan nang husto ang mga bata na magnegosyo, siguro walang nangyari.”

What else should you do to make your family business a success?

 

• Ask if the business is progressive.

If not, know why and then make it more efficient and forward-looking, says Lucban.
If your business is candle making, don’t stop at making candles but start selling the candles yourself, putting up more stores, and producing related products. Mila’s Lechon started with vegetables and fruits. “Nung nagtitinda pa lang ako ng prutas, ang aim ko noon magkaroon ng malaking puwesto para sa karinderya,” Cesario says. “Nung magkaroon ako ng karinderya, sabi ko magtitinda ako ng lechon. Ngayong meron na akong lichunan, sabi naman ng anak ko tignan namin ‘yung potential na mag-franchise.”

 

• Ensure orderly succession.

One of the most common causes of family business failures is poor succession, says Lucban. A family business must prepare the next generation. At Mila’s Lechon, Cesario tasked family members with responsibilities before they reached high school.”Ngayon, meron akong isang anak na tagapamahala kung paano i-manage yung business nang sila-sila lang. Dapat nga retired na kami, pero tinitignan ko pa rin yung mga bata.”

 

• Be there for the long haul.

Whether your family business is new or has been there for as long as you can remember, plan ahead. Set your goal and then support it with clear and workable strategies. Ask yourself in what business you want to be in the next five, 10, 15, and 20 years. What do you want to be known for? The fastest growing company? The most profitable? The most caring? What competence do you have and what else do you need to develop?

 

• Be professional. Separate family concerns from the business.

“You know that not all members of the family end up as managers or president of the company,” says Lucban. “One member might have the drive but not the skill to do things. The participation of a less qualified family member will only bring down the reputation and value of the business.”

So what do you do when push comes to shove and you must decide between pleasing relations and making the business work? The solution is not easy, but it will come to you. Sleep on it and it will come to you.