Hiring family members is one of the many benefits of running a family business. However, the precise timing of when your business decides to hire family-members, as well as their role in the company, is critical to running a successful business.
41-year-old Troy Gunden is an executive vice president of Herr Foods Inc., a $300 million company that produces potato chips. At a recent Speaker Series hosted by the Saint Joseph’s University’s Initiative for Family Business & Entrepreneurship, Gunden spoke of his poor work ethic as a teenager. At the young age of 16, Gunden was late to work and prioritized having fun over doing his job. Despite Gunden’s current success at Herr Foods, his story illustrates the importance of timing when it comes to hiring family-members.
Although your business wants to facilitate participation by the next generation, doing so at too young an age can be detrimental. Encouraging the next generation to work in other fields before joining the family business is one way to avoid hiring unprepared employees. Another method is to ensure your business places the next generation in appropriate positions.
Gunden acknowledges that there will always be non-family member employees who consider a descendant’s success entirely due to his or her familial connections. To avoid falling into this line of reasoning, he argues it is important for descendants to always challenge themselves – “the world of nepotism, you know it’s out there and it’s one of the things that a family member descendant has to wrestle with… but you can beat it with hard work.”
So, when your family business chooses to hire family-members, take a moment to consider which role will provide them with a strong understanding of your business’ values and goals. You want your family-member employees to appreciate how important their work is to your company and understand that their role is not simply due to their familial connections.
Establishing a strong business culture can help your business determine the best time to hire the next generation and exactly which roles they should fill. Herr Foods’ unique family business culture helped Gunden overcome his poor work ethic as a young employee and confidently assert his role in the company. Herr Foods celebrates family values, continuously attempts to maintain interest from future generations, implements leadership track programs to ease succession planning, follows a specific family employment policy, and abides by a family constitution.
Check out our post on how to write a family business constitution.