As a business owner, are you benefiting from a range of advantages as a result of your children (working in the business) being united? Or are you facing difficulties that specifically relate to your children constantly in disagreement? Does this give you sleepless nights? Do you worry about leaving the business to them? Finally, do you sense conflict manifesting below the surface? And did you regret forcing your children to join the family business and not exposing them to the real corporate world? In today’s article, I will share the advantages and disadvantages in order to give you a better perspective on how best to manage your children in the workplace. 


Family members understand each other better. The biggest advantage of having family members working in the family enterprise is the fact that as siblings (or cousins), they typically go along well with each other. Loyalty and strong personal bonds mean family members are likely to stick together in hard times. More often than not, they also manifest the united determination needed for business success. Their years of being together in one household can never be replaced nor compared to an organization of non-family members suddenly working alongside one another toward a shared goal. 

Common values. Families that shared one roof for decades are likely to share the same values on how things should be done. Usually parent-led, these ethos, beliefs, and distinct, embedded practices provide the family with an extra sense of purpose and pride. By default, this will also translate to a competitive edge for the family business.

The organizational structure is simple and effective. It is much easier to start a family business and manage it too. The reason is that in a family business, hierarchy is straightforward and flat, with the parents (usually the father) leading the way. Many of these businesses started with an owner, manager, and staff all rolled into one until the business morphed into a conglomerate. 

Family members are committed. A family owning and running a business is also much more committed. Most family members have solid but informal training, as most of the leaders of family businesses today are trained by their parents or grandparents. For example, Lance Gokongwei and his siblings have been in different divisions of the giant JG Summit Group before becoming the Group CEO, replacing his father. This is why such a business is likely to have similar leadership in the future, although some may opt to add something new to the system.

Long-term Outlook. Non‐family firms with professional CEOs think about hitting goals this quarter, while family firms think years, and sometimes decades, ahead. This “patience” and long-term perspective allow for a good strategy and decision-making. Just last month, I had a long chat with a founder with his children, and the topic of entering the capital markets (IPO) was proposed by his children, which he flatly rejected. In describing his reasons why he didn’t want to take one of his profitable companies operating in the ASEAN region public, he said, “We don’t have to come up with a good story every quarter for the investors and the press.”


Children are one-dimensional. In my experience mentoring next-generation successors, their biggest handicap is that they were never exposed to work in the real world. Their skills and experience are limited, and they have very little understanding of “corporate best practices.” Even if they pursue their MBAs, the influence and sole inspiration from their founding parents will always be the dominant behavior when they work or are assigned to the family business. They may have the drive and passion, including exceptional selling and negotiating skills, but they sorely lack many “best practices” related to organizational structure, as well as financial and human resource management. 

Some family businesses will appoint family members into roles that they do not have the skills or training for. This can have a negative effect on the success of the business and lead to a stressful working environment.

To be continued...