Myths debunked – unveiling the truths about family businesses

Picture of John Broons
John Broons

John Broons is a globally awarded family business expert. One of only three people in Australia to hold the coveted title of Fellow of Family Firm Institute (Boston, USA), John has dedicated his working career to answering the question: how do I guide and support families in business to a place where they’re thriving?

Today I would like to dispel some common myths that have long surrounded family businesses. Being part of a family business is a unique and cherished experience, filled with its own set of challenges and rewards. Yet, sadly, misconceptions often cloud the perception of what it truly means to be part of a family business.

In this article, I aim to shed light on the truths that lie beneath the surface of these myths. By challenging preconceived notions and illuminating the realities of family businesses, we can better equip ourselves to navigate this vast landscape and build enduring legacies.

Myth 1: Family businesses lack professionalism

There is a misguided assumption that many family businesses are mere amateur ventures run by relatives who prioritise personal relationships over professionalism. This is not the case. Family business owners understand the importance of maintaining high standards and operate with utmost professionalism. In fact, the deep bonds that knit families together often serve as a catalyst for exceptional commitment and dedication to their family businesses. Family business members take pride in upholding the values that have been passed down through generations and strive to create an environment of professionalism that rivals any corporate entity.

Myth 2: Family conflicts destroy the business

It’s no surprise that working closely with family members can sometimes result in conflicts and disagreements. However, the misconception that family conflicts inevitably lead to the downfall of the business is far from the truth. In reality, family conflicts can be constructive if approached with open communication and a commitment to finding resolutions. By recognising and valuing differing perspectives, you can transform conflicts into opportunities for growth, innovation, and stronger relationships. Well-managed conflicts can even serve as a catalyst for creativity and resilience, allowing your family business to thrive.

Myth 3: Succession planning is unnecessary

Some skeptics argue that succession planning in a family business is unnecessary, assuming that the next generation’s involvement is guaranteed. However, the truth is that without proper planning, the transition of leadership can become a daunting hurdle that threatens the very existence of the business. Succession planning, far from being an afterthought, is a critical process that ensures the smooth transfer of leadership, preserves the family’s legacy, and sets the stage for continued success across generations. By nurturing and empowering the next generation early on and implementing a robust succession plan, you can safeguard the future of your family business.

Myth 4: Family businesses take fewer risks

Contrary to popular belief, family businesses are not risk-averse entities merely coasting on past accomplishments. Family business owners understand the need to adapt, innovate, and take calculated risks in an ever-evolving business landscape. In fact, intimate knowledge of the industry and the trust you share as a family often gives you the courage to take bold steps and explore new horizons. It is this combination of entrepreneurial spirit and a commitment to preserving your family’s legacy that allows you to navigate, conquer challenges, and continue to thrive.

Myth 5: Family businesses lack professional growth

Another unfounded myth suggests that family businesses cannot provide opportunities for professional growth and advancement. On the contrary, a family business can be a rich and fertile ground for personal and professional development. As family members, you have the privilege of learning from one another, receiving mentorship from seasoned family members, and gaining experience across various roles and responsibilities. Your businesses can serve as a launchpad for family members to hone their skills, showcase their abilities, and embark on fulfilling careers within the family enterprise or beyond.

By debunking these myths and embracing the truths about family businesses, you can liberate yourselves from misconceptions that limit your potential. As family business owners, you embody professionalism, navigate conflicts with grace, prioritise succession planning, take calculated risks, and foster growth and development – which all lead to a sustainable, profitable business.

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