Numeric Eight Blog

When should the next generation join the family business?

Tuesday, April 20, 2021

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For many family businesses, there’s an expectation the next generation will want to join them. That may or may not be true. But the real question should be “When do family members join the family business?”

Running a business is complex and requires a wide variety of expertise to be successful. That's why every staff member (including family) needs to have skills that contribute to its success. 

Business analysts now recommend family members gain work experience outside the family business for at least 3-5 years. There are several reasons for this:

1. To learn what is expected in a business environment

When joining the workforce for the first time, everyone quickly realises there are certain formalities, expectations and self-disciplines that need to be followed. If your first full-time job is in the family business, it's difficult to separate family life from work life. That's guaranteed to lead to problems!

 

2. To bring new ideas and experiences into the family business

Being trained and qualified in a specific area will never replace on-the-job experience. When that experience is gained in other organisations, the family member will be able to use it to enhance what the family business is already doing. 

 

3. To learn best practice

For many, working outside the family business provides an opportunity to see best practice in action. For family businesses already following best practice, external work experience may provide the next generation with exposure to the problems which arise when best practice isn't followed.

 

4. To build credibility

One of the challenges of being the next generation in a family business is a lack of credibility when trying to introduce new ideas. If given the opportunity to develop their own career and achieve success before joining the family business, the next generation has earned external validation for their skills and experience. In turn, this creates credibility, so their ideas are heard.

 

5. To build a desire to contribute to the family business

Productive employees enjoy coming to work and contributing to the success of the business. In family businesses, that should be the case regardless of whether the employee is a relative or an external recruit. Giving family members the freedom to explore their own career opportunities before joining the family business often brings greater enthusiasm and dedication to their work.

 

We're a family business too

Our founder, Trudi Yip, is also involved in a business begun by her grandfather in the 1940s. She grew up observing her family's business dynamics and leverages her experience to provide bookkeeping, accounting, and integrated financial services to other family-owned businesses across Australia.

To investigate how Trudi and the Numeric Eight team may support your business, contact us to arrange an obligation-free 30-minute consultation with Trudi.

 


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