Small Business Diva

June 27, 2008

Should You Hire Friends Or Relatives?

As you enjoy more success in small business, or you look for trustworthy and reliable partners for your venture, it might seem logical to look to those you rely on the most in your private life; often it seems that that the right thing to do is to help those who’ve been with your throughout the ups and downs of life, or to help those who’ve helped you.  However hiring friends and family is not always a good move for you—either for you personally or for your business.  Before you commit to it, you should consider some very important aspects of working with family and friends.

Strong Personal Relationships Are Not Guarantees Of Compatible Working Relationships

Just because you get along well at home and in your personal life does not mean that you will get along equally as well with friends and family once you enter into a working relationship with them.  Often the additional time spent together becomes a strain, even for married couples who’ve been together for years.  There is definitely something to be said for time apart and individual interests for friends and family.

New roles also cause tension between friends and family that start working together. It can be very difficult for your sibling, parent, relative, friend, or spouse to respect you as a boss, and even difficult for you to feel comfortable “bossing” them, regardless of how equitable an employer you may be.

Choosing The Right Person For The Job

Something else that is crucial to consider is how well suited or qualified your friend or family member is for the position he or she will hold.  Being a nice person or a deserving person does not make you qualified for a job—experience and expertise do that.  And putting an under-qualified person in a position could be detrimental to your company; it could be a liability, too.

Ultimately success in small business will depend on the abilities of qualified staff.  If you place the wrong person in a job that they do not perform well, you could very well have no business left to support any one of you!

Preventing And Managing Disagreements And Difficulties

Managing disagreements starts with prevention.  And that starts from the very beginning of the partnership or employment arrangement.

If you are entering into a business partnership with friends or family, you must clearly define the relationship, roles, and responsibilities ahead of time.  You should draft an agreement (preferably with the help of a solicitor or legal representative) that outlines who is responsible for what, who gets what percentages of profits, what happens in the event of a disagreement or business failure, and what the rights of each of you are.

If you are employing family and friends you will need to clearly define roles and responsibilities as well as the structure and hierarchy of the business.  Construct clear policies and expectations, and hold each person accountable as you would any other employee.  Be clear from the beginning that respect is a must, and that you will expect to be treated as any other employer would be and that in return you will be a respectful and fair employer.

At its best working with family and friends can be a very rewarding experience.  At its worst it can be detrimental to business and personal relationships.  Give strong thought to whether the arrangement is workable for you, and maximise the situation by being clear and open from the start.

Here’s to your success in business,

Donna-Marie

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4 Comments »

  1. This post is AWESOME!!! I could not have said it better! Fantastic!

    Comment by Pink Heels — June 28, 2008 @ 12:08 pm | Reply

  2. Thank you 🙂

    Comment by smallbusinessdiva — June 28, 2008 @ 12:18 pm | Reply

  3. […] found an interesting article written by Small Business Diva (Donna-Marie Coggins) that talks about Hiring Friends Or Relatives. I will comment on […]

    Pingback by Start a business with your family? : Small Business Entrepreneur blog — June 29, 2008 @ 12:47 am | Reply

  4. Donna,

    you are right! Being part of the company I’ve founded 3 years ago with my family, I would say your article it’s very good at making a snapshot of what we have experienced since. I’ve also commented on your article here: http://www.energybyte.com/blog/start-a-business-with-your-family

    Comment by Small Business Entre — June 29, 2008 @ 12:50 am | Reply


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