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Investing in people: a winning strategy for families in business together

Reference: FCC

This article is taken from a webinar hosted by psychologist and speaker Pierrette Desrosiers, and explores the challenges families face when working together. It is the second in a series of modules focused on managing the human aspects of the family farm business.

In her webinar “Famille en affaires” [Families Working Together, in French only], psychologist and speaker Pierrette Desrosiers explores the complex dynamics at play in family farm businesses. Family farms are characterized by a strong emotional commitment in which individual, family and professional spheres interact. Desrosiers emphasizes the critical importance of investing in both human and organizational aspects to ensure family cohesion as well as the prosperity and longevity of the business.

The challenges of family

In a family business, most of the decision-making power is held by the family members, who want to keep the company in their hands for generations to come. However, this dynamic comes with its own challenges. In Quebec, for example, only 14% of family farms make it to the third generation. Most failed transitions are due to human rather than technical factors.

The psychologist uses a powerful analogy to illustrate this: “Just as fertile soil nourishes crops and promotes a bountiful harvest, family can be the source of your greatest business successes. But if human issues aren't resolved, family can become a major obstacle to your success, just as pests can ravage your crops and cause major losses.”

There are several reasons for potential conflict: sibling rivalry, lack of separation between family and business, and poor communication. What's more, inequitable management of resources and responsibilities can lead to favouritism and fuel employee resentment and low morale.

Intergenerational disparities

Family businesses involve all age groups, each with different expectations and priorities. Generations Y and Z, for example, value work-life balance and opportunities for personal fulfillment. Individual personalities, interests and skills also influence the way we perceive and react to everyday situations, increasing the risk of tension.

When the torch is passed to the next generation, commitment from family members is paramount. A close-knit, emotionally invested group of siblings is more likely to make a successful transition. On the other hand, you're playing with fire if family members aren't emotionally involved, as disengaged or uncommitted individuals could jeopardize the transition. Moreover, the very qualities and skills that made the transitioning parent successful can become obstacles for the next generation. This phenomenon is known as the “Icarus paradox.”

Best practices

To achieve a harmonious balance between productivity and well-being on your farm, you need to take several key aspects into account. On the one hand, from an organizational structure standpoint, it's critical to:

  • Share a common vision and values
  • Encourage skills acquisition and development
  • Clarify policies for managing leaves, wages and benefits
  • Assign responsibilities fairly
  • Hold regular meetings

On the other hand, it's also important to maintain healthy relationships within the team. You'll need to:

  • Encourage open communication
  • Maintain a balance between professional and personal lives
  • Find satisfaction in your work

To strengthen these aspects and increase motivation, Desrosiers recommends using the five pillars of David Rock's SCARF model, which is based on neuroscience research: status, certainty, autonomy, relatedness and fairness.

Pierrette Desrosiers concludes: “By taking a people-centred approach, you can ensure the growth and longevity of your business, while maintaining harmony within your family.”

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