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As the saying goes, “every family is unhappy in their own way.” Layer in the extra variable of how to run the family business together – and you’re the in-law in charge — that’s a potential recipe for disaster.

Don’t get me wrong. Family businesses are also amazing enterprises. They’re significant drivers of the US economy. Family-owned businesses operate with a strong sense of values and community. But family business dynamics are filled with blurred professional and personal lines. Don’t kid yourself. The intense emotions only family members can incite will always be there.

For an in-law, being part of the family business is a particular challenge. You’re one of the “family.” But not “the family” that started the business. Your relationship with your spouse’s siblings can and will be tense at times. To non-family employees, you’re part of the family with all the perks they assume that brings (and no understanding of traps often laid for you).

Want to run a family business without the muck of family business dynamics? Good luck! It’s probably not going to happen. But here are some tips to help you manage the muck should you find yourself stuck:

1. MAINTAIN STRONG PROFESSIONAL RELATIONSHIPS OUTSIDE THE FAMILY BUSINESS

This isn’t a hedge. This is for your own mental health and confidence. As an in-law you often have to swim against the notion you were “rewarded” with your job. You may feel the constant need to prove you earned it. One common response is being a bit heavy-handed or over-zealous in your behavior. You could be too eager to prove your business value. That approach doesn’t help you, or the business.

Remember you have a professional track record that precedes your current position. Stay connected to people outside the family business who know and respect you professionally. (They don’t have to know they’re helping you stay sane.) These relationships are reminders that your professional success exists apart from the family business. Your previous successes prove that the family hasn’t done you a favor by hiring you. You earned it!

2. HAVE CLEAR LINES OF RESPONSIBILITY AND AUTHORITY

This advice works for any business. It’s mission critical for an in-law. Every family member has their own ideas about how the business should be run. They won’t be shy about sharing them. If you’re the CFO, you’re in charge of the finances – nobody gets to spend the business’ money without your prior approval. Are you in charge of daily operations? Then other family members need to understand they can’t make their own schedules without consulting you.

The family members working at the business want their scope of authority respected (as does anyone). So it’s to everyone’s mutual benefit that decision-making lines are brightly drawn.

3. CREATE A FAMILY COUNCIL TO ADDRESS BIG PICTURE ISSUES

Many of the most strategic, fundamental decisions can’t be made by one person. In “7 Rules for Avoiding Conflicts of Interest in a Family Business,” Carolyn M. Brown recommends having a family council that “addresses family issues or concerns relative to the business.”

A family council includes family members who work at the business, and those who don’t. These other family members will have an ownership interest. The council should meet on a regular schedule. Brown separates family council issues into three categories:

  • Individual professional development plans for family members who work at the business
  • Family plans and the resources needed to achieve them that may come from the business
  • The business plans, which includes management control and strategic direction of the company

Not every family member should be on the council. Indeed, too large a council may not translate into actionable decision-making. As a family member with a senior leadership role in the business, you should be on it. If this decision itself creates conflict, you have the council’s first agenda item.

It’s easier to address negative family business dynamics in a regular forum. People will be less likely to back-channel their agenda.

4. DON’T AVOID CONFLICT – ENCOURAGE COMMUNICATION AND CONFLICT RESOLUTION SKILLS

The family council is one mechanism for handling conflict, at least on a strategic level. Conflict is inevitable on an operational level as well. We all want happy family dinners — so we’ll ignore a lot to keep them pleasant. Yet we recognize that ignoring issues won’t make them go away either.

You’re more likely to address conflicts in a productive way when there’s a process for resolving them at work. Processes are especially needed when there’s conflict between family and non-family employees. Non-family employees are understandably hesitant to express their frustration or concerns.

Say for example one of them shares the same role as a family employee, but is stuck doing all the grunt work because the family employee dumps it all on them — how likely is it that your non-family employee will “tattle” on the family member?

Here are a few suggestions to help you manage those issues and make reporting them feel safe for everyone:

  • Establish a committee made up of family and non-family members to review issues raised
  • Have a clearly outlined process for raising and resolving issues
  • Everyone in the company follows the process, without exception — especially the committee
  • The committee is transparent in its decision-making process — the discussion is open to all (unless it’s a confidential matter that comes under federal or state regulations, e.g. sexual harassment, etc.)

Always be pro-active about noticing sources of conflict. Make sure company policies are being applied equally to family and non-family employees.

5. CULTIVATE RELATIONSHIPS WITH NON-FAMILY EMPLOYEES

It’s easy for non-family employees to feel excluded in a small, family-run business. They may even lose motivation or productivity, if they feel marginalized. As an in-law, you’re in a unique position to smooth over any family/non-family employee divide.

Show them they’re valued members of the team. This doesn’t mean ignoring the contributions of family employees. It’s easy to get too focused on managing the business’s family-based challenges. Don’t ignore the needs and value of your non-family employees.

6. BE SENSITIVE TO YOUR SPOUSE’S SITUATION

Even if your spouse isn’t working at the business, s/he is involved with the business. You and your spouse may not share the same strategic vision for the company. Or you might share it. And now your spouse is in conflict with a beloved sibling who has different ideas.​

There’s a process for addressing conflict within the business. You and your spouse may want to setup a process for managing when the two of you disagree about the business. Do you discuss it at home? Do you bring in a third party to facilitate discussion? How will you each advocate for your different business ideas without undermining your marriage?

Talk about how you’ll manage conflict with your spouse before the conflict happens.

Make Sure the Rewards Justify the Trouble

Being the in-law in charge is no easy task. You have all the typical small business challenges. Plus, you get to navigate family dynamics at the same time! Even so, a successful family business tightens family bonds and provides long term financial security.

Be clear-eyed about the challenges of being the family business in-law. Then tackle them head-on, so you and the family can reap the benefits.

If you’re not getting family cooperation to managing the business in a professional, productive way…remember — working in the family business is not a jail sentence.

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