What are the challenges facing family businesses?
Emily Gillett: Barclays works with thousands of family-owned businesses and have built up a great deal of expertise in guiding them through their growth stage. They are a key part of business in the UK but running a family business is not without its challenges.
Family members may not always be best placed to move the firm forward and integrating non-family members and/or spouses into a family firm can be problematical. Balancing the need to innovate, being efficient and risk-taking against long term traditions and family culture, may not always prove to be compatible.
Neil Way: “Knowing when to bring family members into the business is a big challenge and making sure the unit works. We were lucky, as we’d all had experience outside of the business before we came into it. When our parents left the business, I joined and then I needed support and my brother, and my sister joined. They both had experience of working the city and brought fresh ideas and skill sets.
“This was important, because you shouldn’t join the business just because you’re a family member – you must add value.”
Chris Walford: “The key challenge is ensuring the business has the skills it needs to be successful. Just because you’re a family member doesn’t mean you’re right for the business. But this is the fundamental question that hangs over family firms – do you look to bring in your children or do you take another route?”
What makes family business unique and gives them an advantage?
Phillip McTeer: “Thatchers Cider is very straightforward from a shareholder’s perspective, in that you have three – Martin Thatcher, who is fourth generation – and his mother and father. Making decisions is very easy and they still gather around the same family table they did years ago.
“This gives the business a unique advantage, as decision making is very easy. If the business needs to they can also call on non-execs who have experience in marketing, engineering and global commerce.
“Another advantage is that you can plan for long-term and at Thatchers we work to ten year plans and we set a goal for this and invest accordingly.”
Mimi Avery: “This is a major advantage for us too, as we can set a ten year plan and this gives us security – we know exactly where we’re going and it’s very clear.”
Sue Rodman: “As a family business we like to work with other family firms because they hold traditional values and we know they have a long-term plan, and we know they care and that we can work together with the same aim. It comes across that you care more, as you know their reputation and livelihood depend on being good.
“This is an advantage of being a family firm.”
Alan Bunter: “Conversely, we’ve sometimes been careful not to push the family business angle too much because as a print business we always need to be seen to be investing in technology.
“If people know we’re a family firm they think we’re more traditional and less cutting edge -which isn’t the case; but that can be the perception at times.”
When is it best to bring in outside help to a family business?
Emily Gillett: “One of the key things Barclays talks to family-owned firms about is succession planning. This includes the appointment, timing and integration of any key external hires into the business, planning for future retirement and concerns regarding the skills and experience of potential successors.
“If a family business is facing challenges having a solid plan can help steer it back to good health.”
George Herbert: “We have various members of the family working in the business and I’d say it’s good to bring in experience as soon as possible. It can be hard to have an annual or monthly review with a family member but having a non-exec on board means that they can hold you to account.”
Dan Sweet: “The idea of bringing in family members is interesting. I often think members of the family are done a disservice when they’re brought into the business, especially spouses because they add huge value around marketing and other areas.”
What impact does the pressure of the family name have?
Mimi Avery: “It’s a big pressure and we’re owned by another family firm and you see people come into that business and they wonder what value I add? But then they get to know me and they see the value. I’ve learnt every part of the business and I now have peer respect for that – I’m there not because of my name but because of my talent.”