Managing a Family Owned Business

How to Manage a Family Owned Business by Meir Liraz

This guide will walk you step by step through all the essential phases of managing a successful family owned business. No small business is easy to manage, and this is especially true in a family business. It is subject to all the problems that beset small companies plus those that can, and often do, arise when relatives try to work together.

This book will show you exactly how to initiate and maintain sound family business management practices. It describes what is to be done and under what circumstances in order to prevent some of the confusion and conflicts that may be perpetuated by self centered family members. Such relatives sometimes regard the company as existing primarily to satisfy their desires.

Here's what’s in the book:
~ 25 essential family business strategies - complete, step by step instructions, this is must-know must-do information; ignore it and you stand a good chance to fail. You get specifically designed instructions for each strategy.

~ Understanding the family business - gain deep understanding of what makes a family business tick. Important factors that you must be aware of that will keep you from costly mistakes when managing a family business.

~ How to balance family and business goals - an amazingly simple, low cost technique that will make your family business so much more effective and efficient.

~ Common problems in managing a family business and how to solve them - This topic alone will save you many times the cost of this book.

~ How to choose a successor.

~ Family Business Strategic Plan.

~ All these and much much more.

My name is Meir Liraz and I'm the author of this book. According to Dun & Bradstreet, 90% of all business failures analyzed can be traced to poor management. This is backed up by my own experience. In my 31 years as a business coach and consultant to managers, I've seen practically dozens of owners fail and lose their business -- not because they weren't talented or smart enough -- but because they were trying to re-invent the wheel rather than rely on proven, tested methods that work. And that is where this book can help, it will teach you how to avoid the common traps and mistakes and do everything right the first time.

Sample Content:

The time of the owner-manager is one of the most valuable assets of a small business. It should not be dribbled away in routine tasks that can be done as well, if not better, by other employees. Never lose sight of the fact that you as owner/manager, have to make the judgments that will determine the success of your business. You may want to run a check on how your time is used. You can do so by keeping a log for the next several weeks. On a calendar memorandum pad jot down what you do in half hour or hour blocks. Then review your notes against the questions: Was my time spent on management tasks such as reviewing last week's sales figures and noting areas for improvement? Or did I let it dribble away on routine tasks such as opening the mail and sorting bills of lading? You may want to ask your key personnel to run the same sort of check on their time.

Do you set goals and objectives?

Goals and objectives help a small company to keep headed toward profit. Goals and objectives should be specific and realistic. In addition they should be measurable, time phased, and written. List your goals and objectives by writing them out for your present successful operations. Objectives that are written out in straight-forward language provide a basis for actions by your key personnel. For example, state that you will sell certain number of units this year rather than saying you will increase sales.

Do you have written policies?

Flag this question and return to it later. Working through this checklist should suggest changes that may be needed if you have written policies. By the same token, your business will provide input for writing out policies if there are none in writing.

Is planning done to achieve these goals and objectives?

In a sense, planning is forecasting. An objective, for example, for next year might be to increase your net profit after taxes. To plan for it you need to forecast sales volume, production of finished goods inventory, raw materials requirements, and all the other elements connected with producing your forecasts, you will want to make provision for watching costs, including selling expenses. If there are key employees who can provide input into the planning, ask them to become involved in that process

Do you test or check the reality of your goals and plans with others?

Outside advisors may spot "bugs" that you and your people did not catch in the press of working through the details of goal setting and planning.

Are operations reviewed on a regular basis with the objective of reducing costs?

Costs must be kept in line for a profitable operation. Review operations periodically such as weekly or monthly, to insure that overtime is not excessive, for example. And what about quality product acceptance by customers? Costs may be excessive because of obsolete methods or machinery that has seen its best days. And what about plant layout or materials flow? Can changes be made that will save time and materials? Determine the frequency of your reviews for the various types of operations and place a tickler on your calendar to remind you of these review dates.

Are products reviewed regularly with the objective of improving them?

Products that your customers benefit from are the key to repeat sales. A regular review of your products help to keep them up to the expectation of customers. Feedback from customers can be useful here. To reduce costs sometimes a product can be modified without sacrificing use and quality. If product obsolescence is a hazard, what plans are being made to substitute new products as existing ones become obsolete?

Do you ask outside advisors for their opinion and suggestions on products and operation procedures?

Outside persons, such as friends in non-competing lines of business and management personnel from local colleges and universities can help you see the facts about your products and operating procedures. They can provide a fresh viewpoint - the viewpoint of persons who are not so involved in the products and operations as you and your key personnel. The suggestions and counsel from a local management consultant may provide benefits far in excess of his or her cost. In this area some small companies set up a board of directors to satisfy the law concerning small corporations. But that is the end of it. Members of the board are not used for their knowledge and skill in business. They can make valuable contributions and the owner/manager should use all possible opportunities for getting such concerned opinions about the various phases of the company.