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46 May 2015 | beautystorebusiness.com "WELCOME TO THE FAMILY BUSINESS. TAKE A backseat." Does that sound friendly? Maybe not, but too often family business employees with a politically incorrect last name hear something similar. These non- family workers often get the short end of the stick. Some get shouldered out of important meetings. Others get passed over when promotion time rolls around. And the company parking lot is where "outsiders" often get assigned the worst spots. However it plays out, discrimination against nonfamily employees can be costly to the bottom line. Otherwise good workers start to exhibit low morale, engage poorly with customers or even jump ship for the competition when they feel under-appreciated and ignored. It all highlights a critical fact: People beyond the bloodline are critical to any family business. "Unless one has a huge family with members possessing the competences for every phase of the business, outsiders are needed," says Ian Jacobsen (jacobsenconsulting.com), a management consultant based in Morgan Hill, California. On the positive side, family operations grow and thrive when they take steps to make nonfamily workers feel like productive members of the community. "Suc- cessful family businesses, if they are going to grow, will depend on their ability to attract and retain nonfamily employees," says Craig Aronoff (thefbcg.com/aronoff), chairman of The Family Business Consulting Group in Chicago. How about your own family business? Do nonfamily workers feel like part of the team—or like unwelcome intruders? If the latter, you can take steps now to create a more welcoming work environment. BUSINESS FIRST To start creating a better environment for nonfamily employees, take a fresh look at your core principles. "Determine what sort of organizational culture you want for your business," says Jacobsen. "Are people to be respected and valued more for who they are in the family or for what they bring to the business?" The first attitude is typical of what is called a "family first" organization. Such a business, says Jacobsen, is really "a social-welfare organization for family members." The second attitude characterizes the "business first" organization, which is "a real busi- ness that includes family members and outsiders." How you define your organization's position between these two categories will determine a host of man- agement dynamics—not the least of which is your treatment of nonfamily employees. Perhaps it's not surprising that Jacobsen, like most other family business consultants, advises creating a "business first" environment. "For the business to succeed over the long haul people need to be valued more for their contribution to the organization than for their family ties," says Jacobsen. "That requires establishing an inclusive culture based on personal respect and what each worker brings to the business and accomplishes." HIRE AS NEEDED All this is not to say that a "business first" organization can never promote a family member to a top job. "Family members will be brought in from time to time and pro- moted," says Jacobsen. "That is part of what makes up a family business. People who are not a part of the fam- ily need to understand this and appreciate it in order to succeed and not to be discouraged when this happens." Even so, family business counselors advise carefully preparing any family member who wants to join the business. A common suggestion is that family members earn their stripes elsewhere. Then if they arrive at the business when needed, they have the background and experience to fulfill their duties. "We advise family members earn their stripes by working three to five years outside the family business," says John Joseph Paul (familybusinesscounsel.com), a Portland, Oregon-based family business consultant. "This allows them to bring something of value to the organization. Nonfamily employees are more likely to recognize that they have paid their dues." It can be smart also to obtain a degree that adds value to the company. People will respect the family manager if his qualifications for a job are unassailable. And don't hire a family member just to give him a paycheck: There must be a valid position to fill. "The business should make sure that the role the person is filling is really needed and that there is a general recognition of that need," says Jacobsen. "Those nonfamily people who Family businesses aren't just for family. Here are tips on making "outsiders" feel at home. by Phillip M. Perry Helping " O u t s i d e r s " "Outsiders" Fit Into the Family Business