Current Tips and Trends in Family Owned Businesses

With numbers between 1.2 and 1.3 million in the United States and steadily rising it seems that the modern family owned businesses are no longer fitly described by the old “Mom and Pop” colloquialism.

In her 2006 book, “Couplepreneurs: Prosperity Through Partnership,” business coach and entrepreneur Jean R. Charles writes that “the fastest-growing family owned businesses today are new businesses started by couples who jointly share ownership, commitment, and responsibility.” “Couplepreneurs” or “copreneurs” are quickly becoming buzz words in the family owned business world, referring to partnerships between spouses. Blurring the lines between work and play, the boom of the business couple is re-inventing the workplace, requiring today’s power duo to be both business and relationship savvy at the same time. Follow along for the latest on how couplepreneurs are shaping family owned business trends as well as practical tips for maintaining a successful partnership, both at work and at home.

Trend: The spouse is the family owned businesses most trusted adviser

Although in 2002 the business accountant ranked at the top of the list, according to the 2007 American Family Business Survey conducted by MassMutual and the Family Firm Institute, the typical family business owner designates his or her spouse as most trusted advisor, above family members like parents or siblings as well as other important partners like the lawyer, banker or non-related colleague. Perhaps the rise of the family owned businesses explain the shift in survey results.

Family Owned Businesses Tip: Place an extra emphasis on clear communication

Dr. Alice Bledig, and her husband Albert Bledig, M.D. grew their family medical practice together from the ground up, often juggling multiple roles and responsibilities in the absence of a fuller staff. Without hesitation, Alice points to Albert as her most trusted advisor. And their secret to 47 years of successful couplepreneurship? “I think communication is very important and I think trust is very important. I trust him and he trusts me to the best thing for our practice.” The 2010 MassMutual study, FamilyPreneurship: What Every Entrepreneur Wants to Know About Being in Business With a Family Member, confirms the importance of communication in the family-owned business world: “According to our research, communication is the most common factor cited as being necessary for maintaining good relationships with family – both inside and outside of work.”

Alice explained that, in the beginning, the couple learned a lot of lessons through trial and error. “We’d discuss things, we really did, we spent time talking about it and giving what we thought was best. We tried something and if it didn’t work, we tried something else.” Today, their practice of 47 years and their marriage of 52 years are both still thriving. “We trust, we communicate, we value each other and I think since we work together there is an element of love that comes into that.”

Family Owned Businesses Tip: Women-owned businesses continue to increase

Kathy Marshack, psychologist and author of “Entrepreneurial Couples: Making It Work at Work and at Home,” points out that female-owned businesses skyrocketed 42.3% between 1997 and 2006 and keep growing. She considers this leap at least partially responsible for the surge in couplepreneurship, explaining that in years past, the wives of male executives were often hired as assistants, not partners. Now, women are taking the initiative, starting their own family-owned businesses, and inviting their husbands on board: all with spectacular results. In 2003, MassMutual and the Center for Women’s Leadership at Babson College produced the Women In Family-Owned Business report, determining that female-led family owned businesses were more productive and successful than male-owned firms.

Family Owned Businesses Tip: Toss old-fashioned gender roles out the window

For years, culture and tradition have exacerbated the unequal sharing of responsibility in family owned businesses, meaning that wives of male executives are often unpaid stakeholders: informally assuming leadership positions with no pay and little credit. Yet, as the Women in Family Owned Business report demonstrates, gender inequality within the family-owned business world can cost a business not only its productivity but the loyalty and satisfaction of its employees, as well. Female-owned firms exhibit higher rates of productivity and lower rates of family member attrition than male-owned firms; a savvy businessperson would interpret these facts to promote the equal sharing of responsibilities and the increased valuation of female contributions to the family owned business.

Furthermore, shared responsibility does more than benefit a business’ bottom line; when both spouses feel equally valued, respected, and compensated for their contributions to the family’s financial success, it improves household harmony. Alice recalls the early stress of being a wife, mother, and business partner at the same time: “At first Al expected me to work down there, then come home and prepare the evening meal and take care of the kids, get them bathed and fed, so my job continued I feel like more than his did.” When they hired a caregiver to lighten Alice’s work at home, the dynamic quickly shifted. “I felt like more of an equal.” She explains. This is crucial because irreconcilable conflict (which can often be caused by one partner feeling taken advantage of or devalued) may threaten the business altogether. Research shows that divorce is the quickest way to dissolve a family owned businesses; most partnerships simply cannot survive separation.

Trend: The family owned businesses are more customizable than ever

As Generation Y enters the workplace in full force, small business trends are progressively evolving to reflect the young blood, which, according to BusinessWeek, is “re-writing the rules” for family-owned businesses. Today’s budding entrepreneurs were raised in the age of customizable products and services, making them less likely to subscribe to the rigid one size fits all business models of their predecessors and more likely to create practices and strategies unique to their specific needs and goals. Forget 9-5; the Gen Y executive may not follow the same schedule two days in a row, as long as he or she still gets the job done.

Family Owned Businesses Tip: Design a couple-friendly business model

Couplepreneurs of all generations can take advantage of how customizable the family-owned business has become to achieve a better work-family balance. Communication technology characteristically embraced by Gen Y like smart phones, web conferencing, and social networking allows couples to work at home or on the road, meaning more time together and with the kids, as well as the opportunity to vacation together or even to cultivate a permanent lifestyle of work and travel. This flexibility can eliminate the stresses that typically overwhelm a family like commuting, child care, and time off. And research shows that it pays to be happy; a higher quality of life does not simply strengthen a marriage, it increases a family owned businesses’ productivity and, therefore, its long-term sustainability.

Whoever said work and love do not mix must be biting their tongue. There’s no doubt about it, the “couplepreneurial” spirit is taking the family owned businesses world by storm and changing the rules. Who knows? Before long, shrewd executives looking to scope out competition may be skimming newspaper wedding pages without consulting the business section at all!