Many of the small businesses that we encounter are family-owned and operated. And on the surface, this seems like a good idea. After all, you love your family, so why wouldn’t you want to work with them? You know them well and trust them, so it seems like a lower risk venture than relying on strangers.

While working with family members may start out easy, there are some circumstances that can become difficult and even awkward. Take for instance, a man who starts his own company. He asks his wife to help

with the bookkeeping. All goes well for awhile. They are able to keep the business’ finances confidential among themselves while keeping a close eye on their income and expenses. But, one day their kids get sick, and the business owner’s wife stays home to care for them. Unable to work while tending to the children’s needs, she falls behind on the books, and vendors start to call. These calls create stress for the business owner and now, he comes home to his bookkeeping wife with that stress. So what happens? How does he address the issue? Is it a performance problem with an employee or does it become a marital issue? Does he really want his wife to leave his sick children with a babysitter just so she can pay the bills and keep the books up-to-date? Then again, if he isn’t able to pay the bills in a timely manner, his business will suffer. Not to mention the last time he went in and paid them himself, it took his wife hours to redo the entries that he did “wrong”. As you can see, the problem is no longer just work. It becomes personal.

Now, I’m not saying that family members should not work together. To the contrary, in many cases, family businesses can bring families together rather than drive them apart. But just as it’s important to set clear expectations with any employee, it’s even more important to do so with family members.

Owning a family business or even working with relatives introduces unique dynamics to an otherwise common business venture. While working with family can be rewarding and profitable, it is imperative that guidelines are established early to prevent any potential problems. If you are planning on working with family members, here are a few things to consider:

1. Give careful thought to whether you want to work together in the first place.

For some business owners, hiring family members is a short cut tofinding help. Family members are easy to find and have a sense of obligation to help their family. But make sure to think long-term. If a family member is not the best person for the job, do not hire him or her.

2. Set clear and precise expectations.

With every employee in every job, it’s important to set clear expectations. But with family members, it’s imperative. If you are bringing a family member into your business, know why. What do you want them to achieve? How will you measure their performance? Write it down and share it with them. Make sure you are both clear on your expectations as well as theirs. This will help prevent you from taking advantage of them as well as prevent them from taking advantage of you.

3. Create mechanisms that separate family and business.

Having time “off” is difficult for any business owner and if you are working with family, it can be twice as difficult. Some families make it a rule not to talk “business” at home; others set sacred time aside where there is no mention of business. Still others have times specifically for talking about business, such as breakfast. You also need someone, a non-family member; you can talk to about your family employees. Most people gripe to their spouse about their boss or employee, but when your spouse is the boss or employee, you’ll need to find somewhere else to go.

4. Remember Thanksgiving.

With other employees, you may get to the point where you need to just cut the cord. You have one firm conversation, and then it’s over. With family, you still have to see them at Thanksgiving, birthdays, well… all the time. This means that you have to take care of the relationship, both in the office and at home. Make sure problems are completely resolved so they don’t flow over into the family aspect of your relationship. Be firm but fair, and make sure business stays business.

5. Be flexible.

You always want to be fair with employees and family members should be no different. Sometimes it’s easier for us to be hard on family simply because they are family. This can spell trouble in business. Treat them as you would other employees and be just as understanding. While you have personal knowledge of them and their lives, don’t use it against them. Try to instead work with them.

6. Establish an exit plan.

While working with family members can be good, not all situations work out well. While you want to remain positive and optimistic, have an exit strategy. That is, be prepared to separate your family members from the business. This may seem harsh and create some animosity, but it may be necessary to save your personal relationship. If things are going poorly and the relationship is suffering, putting distance between the business and your family member may be your only option.

Working with family members requires a special understanding of the accompanying complexities. Following these guidelines should help you and your family member enjoy a successful business relationship. But in the end, just remember they’re family, and business is just business.

Photo credit: Yasin Hassan