How To Improve Family Business Communication

Family businesses can be financially rewarding, but stressful when communications are ineffective. Separating business from personal issues is difficult when your family members are your co-workers and bosses. Especially in family businesses where some owners are non-active participants in the business, strong communication lines are essential. Establishing clear communication methods can minimize business errors and frustration and they can lead to more better interpersonal dialogue and long-term business success.

Step 1

Outline clear lines of command. It is easy to fall into a business structure that neither clearly identifies the bosses nor areas of responsibility in a family business. Step back from the business and clearly define which family members are responsible for each routine task and operational function in the business. Gary Naumann, an entrepreneurship lecturer at Arizona State University, suggests sorting tasks by functional area and assigning responsibilities based on individual competence. Without clear lines of control and responsibility, communications may be ineffective.

Step 2

Create personal, family and business goals together. Goal setting promotes discussions and helps the family members establish common ground according to Dr. Craig E. Aronoff. When all family members understand the direction of the company, communication lines are strengthened as everyone is working from the same foundation.

Step 3

Communicate frequently. One of the biggest risks to family-owned businesses is losing trust and a shared company vision according to Wharton University. Routine communications with all family owners of the business are necessary to keep everyone focused on the same goals and long-term business objectives. Without frequent communications, non-active family business owners may feel neglected and may not support the collective vision for the company.

Step 4

Hold routine family business meetings. Individual family members may want to cash out their shares in the company if they do not feel a part of the organization or believe their financial stake is at risk. Timothy G. Habbershon suggests holding regular family and shareholder meetings as a way to promote family unity and trust in the longer-term goals of the company.

Step 5

Create a development program for younger family members. Business succession requires disseminating information and knowledge to the next generation of family business leaders. Professor Kelin E. Gersick suggests establishing a management development plan that spans 10 years. Establishing a mentoring program or management training course can increase relationships between generations and allows the transfer of accumulated business knowledge and wisdom.