Relatives and friends in the business. What is bad and what to do about it

When we think about a family, we usually present something like this. The father explains something to his son, and his son listens attentively and with pleasure. An idyllic picture, isn't it? It would seem that the same should be in business, but in reality everything is not as rosy as we would like. In this article I tried to analyze the phenomenon of “relatives in business” in Russia based on my experience.

In one of the past articles entitled “ How to lose a business. Real stories from a business consultant "I described a real case of loss of business due to nepotism. There I told how the company was brought to bankruptcy by relatives of the owner of the business.

Practice shows that cronyism or the presence of relatives in the business is massive. In almost every project, I had one way or another to face this phenomenon.

And now I decided to elaborate on this phenomenon, to understand why this is bad, and to share practical tips from my experience as a business consultant.

When I talk about nepotism or relatives in business, I mean any personal relationship. These can be children, wife, brothers, matchmakers, friends and acquaintances. Any people with whom relations cannot be kept within the limits of exclusively professional.

Personally, I think that the presence of relatives in the business is a negative phenomenon. And the examples that I will give will also be mostly negative. The reasons for this attitude and their rationale, I also will consider below.

Of course, there are positive examples of the presence of relatives in the business. More often than not, such success stories begin with the fact that friends or relatives start a business from scratch. They then have common goals, a common vision of the situation, they know all the features of the company's work and lead it to a common goal. In this case, the relatives become real partners and like-minded people who can replace and complement each other in matters of business management.

There are also successful examples of cooperation with relatives in a ready-made business. But most often this phenomenon creates additional difficulties for the manager, negatively affects the dynamics of the company’s development, and creates obstacles in cooperation with specialists from the outside.
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How do relatives appear in the business?

Ordinarily, relatives in the business do not appear immediately. At the stage of formation, the businessman works on his own, and also hires specialists to perform certain professional functions.

Then the company develops, and at a certain stage the manager (founder, owner of the business) ceases to personally cope with the control of the work of all departments. He has a need for deputies and / or heads of departments, which will be able to delegate some of the functions of the head. And then in the company often appear friends and relatives.

The choice of “our own” people, regardless of their competence and professional knowledge, is quite common in our country and is usually due to one of the following reasons:

• The trust. It is believed that a relative - do not cheat, he can be trusted with any secrets. And competence, knowledge and skills will come with experience. Many companies are trying to evade taxes and work on the "gray" and "black" schemes. That is why the management of the company often feels great mistrust towards people. And in all key positions they are trying to appoint those who, from the point of view of management, deserve special trust.
• The desire to keep the heirs in the family business . Often they try to involve children in work, attach them to work, and teach them in practice. That is why very often the children of business owners become their partners or heads of key departments.
• Pity and the desire to ensure the work of a loved one also often leads to nepotism. People are simply hired to help them, to provide some kind of income. A misunderstanding that is misunderstood does not allow us to offer a place for a petty clerk or another minor position.
• The weakness of the manager in family relationships is another reason for the appearance of relatives in the company. Even the strongest and toughest businessmen can show weakness with their families. And then relatives with the help of persuasion or pressure force the businessman to take them to work in the role of partners or leaders of different departments.

My own experience shows that this phenomenon carries a lot of negativity. Of course, I do not exclude cases when a relative is really in his place, brings clear benefits to the company and works fruitfully. But in practice, the situation is often quite different.

Using my clients as an example, I studied in detail how much negative this phenomenon can bring, and cooperation with companies where nepotism is present, only confirmed that relatives and businesses should either not combine at all or have to be prepared for a whole list of negative consequences.

Question of trust

Most often, relatives and friends become partners, leaders, and heads of departments of the company due to the fact that they are trusted. In Russia, trust in business is very highly valued, often even higher than competence and professionalism.

But in the event of a conflict, relatives and friends are no different from employees who got into the company from the outside. They are offended in the same way (and often even more strongly); they can also take out confidential information out of company limits for revenge or resentment. There may be other harm.

At the same time, relatives are most often confident of their own impunity, and therefore their motivation for quality work is lower than that of hired personnel, and the level of complaints is much higher.

In fact, hired staff will also keep your trade secrets or job features exactly the same. A person from the outside will also be neat and loyal. And in the event of friction and conflict, people from the outside, even more often than relatives or friends, behave correctly in relation to information. Of course, situations are different. Therefore, I personally believe that both hired people from outside, and relatives or friends who work in the company deserve trust.

Questions of trust are questions of the personal quality of a person rather than kinship or acquaintance with him outside the business.

The desire to keep children in the family business

It is very important to understand that the head of the company in the period of the formation and development of business has come a long way, learned a lot, mastered it, studied it. What can not be said about his son or daughter. Of course, everyone wants to pass on their knowledge and skills to children, such desires are especially noticeable in small and medium-sized businesses, where not so many people work, and the manager delves personally into almost all processes. But practice shows that it is extremely rare to realize.

The reasons here lie in the field of psychology. Most often, the head of a small and medium business is a person who has left a low-income or middle-income family. He created his business from scratch, he enjoys every penny, every achievement of his company. He knows how to value money, which cannot be said about his children.

By the time the children grow up, usually the business is already established, the family lives securely. And children simply do not know how to value money as their parents did. They are somewhat spoiled in this matter, and therefore their attitude to earnings, and the motivation of businessmen’s children, are often completely different.

In addition, today to raise an heir by the methods of past centuries, i.e. attracting him to the management of the family business, it turns out very rarely. The main reason here is a different pace of life. Today, teaching your children business through your own experience is the same as preparing soldiers for the last war.

Therefore, in order to successfully manage a business, in addition to knowledge and experience that parents can pass on, get education and work experience in other companies, be able to independently acquire new professional knowledge and skills and use new tools. It will be much better if the child receives knowledge and experience on the side and brings something new to the company.

Attempts to provide work out of pity

This situation is the most senseless and harmful for business. If a person is accepted for work out of pity, if he himself is not able to work in life and provide himself with a decent income, then, as a rule, not only is there no benefit from him, but there can also be harm. Just because of incompetence, laziness, passivity, inability to resolve conflicts, etc.

And business such people are usually very expensive. In addition to the direct costs of the workplace and wages, the company also incurs indirect losses due to the fact that these employees are not effective in their place. Moreover, this person will occupy someone's place, the one who could really benefit in this position.

Examples of nepotism in business

As a business consultant, I constantly face real difficulties in small and medium businesses. And often, cronyism (relatives in the business) becomes one of the causes of a crisis situation or even the bankruptcy of a company.

Below I will tell you a few real stories that I observed in the companies of my real or former clients. Of course, the names of companies, as well as other information on which they could be identified, I will not call. But, again, all the examples that I cite are real stories that I have personally observed.

Example 1. From rags to riches

At the dawn of my work, I got a job at a manufacturing company that produced equipment for construction. I was assigned a office to work next to the same office of another employee, whom I knew nothing about at that time.

And on the very first day of work I witnessed that in this office several shouts were heard, and then crying women would come out from there. Within two weeks, I have twice witnessed such events, and how many more cases have there been that I have not seen! What kind of person this is, and why this situation arose, I found out only later.

It turned out that the office opposite to mine belonged to the deputy general director for capital construction. Until recently, the person holding this position was a simple welder at the same enterprise.

The seat of the deputy general director was received by this person as a result of his acquaintance with the general director’s daughter. The young were married, and the father of the bride decided to help his son-in-law with a career. However, similarly, this director did with her daughter, she took the place of deputy general director for development, while the girl had no experience in this type of work or experience.

What's bad about it?

People appointed to leadership positions solely on the basis of kinship, were absolutely incompetent. Daughter gene the director had no education. She was just an energetic lady. I can not say that my daughter did not try. On the contrary, she really wanted to do everything as best as possible, attracted various specialists, tried to set up work. But nature took its toll, and the results of its confused activity did not bring.

As a result, for the period of my work in the company a lot of different people visited. There were many attempts to make changes to the work, but they were all confused, there was no development strategy, and throwing from side to side often led to negative consequences.

People without education, without appropriate skills, without experience could not fulfill their duties qualitatively. The company in that period was already experiencing hard times, but because of the lack of competence of random people in the leadership, the situation only worsened.

The company was saved only by the fact that it was engaged in a narrowly industrial activity, had the power and equipment inherited from Soviet times, as well as relations with suppliers and customers, which also continued to be used by inertia.

Example 2. Many relatives - many problems.

In this case, I ran into a group of companies, in which management positions were held by relatives of the director of the parent organization, who invited me as a business consultant.

How was it bad?

Any changes that were required by the project, passed through the filter, consisting of the relatives of the head. These people were often incompetent, while actively resisting any changes. For example, a person with a historical education and practically no managerial experience worked as a general director at a technology company.

Such leaders, who did not pass the selection, occupying the “wrong place”, blocked practically all the changes that needed to be implemented. Their unwillingness to delve into innovations, their fear of change had to go around very slowly and with difficulty.

Example 3. Wife and at work remains wife

The wives of managers very often take the place of the chief accountant in order to exercise control over the funds. And, of course, they tend to be close to her husband, including at work. I came across different situations, but I especially remember the case when the CEO had an office adjacent to the chief accountant! Of course, the chief accountant was part-time wife of the head.

To discuss these or other issues, we were always forced to close the doors with the manager. And one day, the chief accountant-wife ran into the office of the general director with a scandal on the subject of "why are you closing from me"!

It is clear that a hired chief accountant would never allow herself such statements, and his wife thought that she could be scandals at work.

Relatives at work: why is it so difficult with them?

What are bad relatives at work:

1. Do not pass the "natural" selection, which is accompanied by any career growth.
2. Most often not qualified for the job where they are hired.
3. Almost always not interested in change. It is important for them to maintain the status quo.
4. Do not have enough motivation to work effectively.
5. Negatively affect the staff of the company, as ambitious and highly professional employees understand that career growth is impossible here.
6. They mix personal relationships and workers, as a result, the manager constantly feels guilty both in front of employees and in front of relatives.

I have identified such a list of shortcomings, and now I propose to understand them in a little more detail.

Incompetence and “natural selection”

Here the cons, I think, are obvious. Usually, people start their careers as ordinary employees in positions that do not require high qualifications. Further, in the process of professional and career growth, those who are not able to lead, are not able to make decisions, do not want or are not able to learn are eliminated. In this case, the leadership positions are occupied by experienced professionals who are able to lead the company to prosperity.

If this natural selection is ignored, then there is a high probability that a person who has neither knowledge, nor skills, nor leadership will be in the manager’s chair. The result is either a decrease in the efficiency of the company due to inept management, or other employees are forced to take on the functions of an inept manager, and the position becomes a sineuru.

Resistance to any change

Relatives in management positions are well aware that together with any changes their position in the company may change. But such people are not ready to go to another organization if necessary, they no longer want to be ordinary hired personnel, they tend to remain in the position of head-relative as long as possible, preferably until the end of their work. And therefore any changes come across the wall of their rejection and are very difficult to be implemented in the presence of nepotism in the company.

At the same time, it is incredibly difficult to get around such an employee and get direct access to the CEO. The person will block any opportunity for such communication. And even a minor conflict with this person often leads to hostility and even hostility from the director.

If an ordinary employee sabotages changes in business, then only the question of competence arises, and often the CEO understands the problem correctly and helps to solve it. But if the conflict is brewing with the relative of the leader, then the perception of this conflict goes on a personal level.

I have had such cases when, in the course of my work on the implementation of the project, a sufficiently scrupulous situation arose, reaching the point of conflict by a relative employee. At the same time, the director of the company said that I should not do anything and in no case quarrel with this employee.

On the one hand, it is difficult for a manager to recognize an employee’s mistake in such a situation. He is put in a position where he has to choose not between two business decisions, but between two people: a consultant and a relative. Internally, each of us is ready to protect the family, and these psychological mechanisms also work here.

On the other hand, if the director takes the side of a specialist who brings these changes, he will support a stranger as opposed to his son or wife. This is not only unpleasant emotionally, but can lead to conflicts in the family. As a result, some kind of “mouse romp” or outright scandals often begin, which is very bad for business.

Lack of motivation

Another important point to remember is always. The motivation of relatives is very different from the motivation of ordinary employees. Just because relatives know that they will never be fired.

I have often observed on projects how incompetent children of a business owner, his wife, and other relatives made gross mistakes. In some cases, such employees allow you to skip work or are on permanent paid holidays. Generally, whatever relatives do, they are not fired. Even in cases where their actions or inaction lead to big problems.

This is well understood by the employees themselves, relatives. Naturally, if he does not want to, he will not do anything, or will block these or other decisions, or simply may begin to interfere with work. And nothing can be done about it. After all, how can you dismiss a son or wife? Yes, nothing.

As a result, a relative employee most often collects such a “bunch” of qualities:

• Incompetence.
• Lack of fear of dismissal.
• Lack of motivation to work.

And, as a result, a relative employee is distinguished by the highest inefficiency. Wherever and in what capacity he worked.

No career growth

An important minus of the presence of relatives in the business is the lack of career growth for ordinary employees. In this company, everyone understands that you can grow a maximum to the head of a department. And all top management consists of someone's friends or relatives.

As a result, competent and ambitious employees, instead of benefiting the company, are learning, gaining experience, and then leaving. Those. Your company is engaged in the education of personnel for competitors instead of raising their staff. By the way, this is one of the reasons for high staff turnover.

Who is guilty? Director!

Another disadvantage is that the business manager is constantly feeling guilty. He is not at all comfortable in front of hired employees, since his relatives are always a kind of burden, certain preferences. He is well aware that in his company people with low qualifications occupy key positions, as a result, a significant part of their work is on the shoulders of subordinates, etc.

At the same time, the manager often feels guilty towards his relatives, since they are not shy about expressing offenses even in response to fair comments on work. Relations between workers and personal mix, and here also the situation is not the most pleasant for the manager.

Unfortunately, if a person takes relatives to work, he needs to be prepared and for such nuances.

Relatives in business: how to deal with it?

In my practice, there have already been more than 70 projects in which I, in one way or another, came across the phenomenon of nepotism or relatives in business. That is why I also gained some experience in dealing with this phenomenon. In principle, I do not think that the presence of such people in the company is a significant drawback for the implementation of new solutions, and I actively cooperate with businessmen who for one reason or another work with friends and relatives.

But nevertheless this phenomenon carries a negative often, and over the years I have been faced with various situations that interfere with my work. And even learned to avoid them. These developments and want to share. So what to do if you are faced with relatives of the head?

Do not quarrel with the relatives of the head

Do not quarrel with these people. If you bring any changes to the company, it is very likely that these people will oppose the implementation of your project. To this end, among others, a well-known method is actively used: to drive a person out of himself and to provoke a scandal. As a result, the conflict moves into their field, from the professional to the emotional sphere.

They can apply the methods:

• Boycott;
• Direct rudeness;
• Delaying the solution of questions.

Of course, this is all annoying and interferes with work. What to do in this case? In no case do not quarrel, but before the leader to put the question with an edge, and even better to warn the manager in advance about possible difficulties.
When I get into a new company, very often I directly ask the manager if his friends or relatives work with him, and if so, what positions they occupy. If it is not possible to obtain information in this way, I will definitely check with the employees with whom I have to work whether they are not relatives or close managers.

Why am I doing this?

At the beginning of my practice, when I did not pay enough attention to the kinship of clients, I had such a case. A 22-year-old girl with zero competency worked as an online store. This store had excellent attendance (more than 120 thousand people per month), but almost zero conversion (less than 0.1%).

In the analysis of the store, I clearly demonstrated the incompetence of the store administrator and suggested changing the employee holding this position.

Unfortunately, then I could not even think that the administrator of the online store would be someone’s relative. And after this report I had extremely tense relations with the director of the company. Yes, of course, then I figured it all out and made amends for this situation, but it took a lot of effort for this.

Remember that you have a goal - to complete the project, and not to remake a person or affect his family relationships. That is why it is better to find out whether the relatives of the management work in the company, and if so, who and in what position, in advance.

And do not forget that relatives and friends of the head of the company almost always require special attention and attention to themselves, regardless of position.

Avoid contact with the relatives of the head

Also a convenient and useful solution - if possible avoid at all any kind of communication and cooperation with relatives in the business. If you need helpers and project managers, assign them from among hired employees.

In cases when it is not possible to avoid communication with the relatives of the manager, try to be as correct and careful as you can with them:

• in no case do not educate such employees,
• do not include them in active work,
• Do not try to teach them something.

Try to neutralize them as politely, correctly and carefully as possible, i.e. do your best to keep their participation in the project to a minimum.

If conflict cannot be avoided, just go about your business!

Yes, just like that. There are situations when you will not be able to avoid conflict with the head's relatives, even if you are ideally correct and careful. Just because the employee-relative himself opposes change and creates conflict situations.

In this case, I personally advise everyone not to forget about politeness and correctness, but not to worry too much about the situation. Just keep working and do your thing.

If there is a need for change in the company, if your services are in demand, and you are seen as a specialist who can solve the problem, both you and the conflicts surrounding your work will be tolerated.

In this case, one thing is very important: to demonstrate all the results directly to the manager and do it in a timely manner. Be sure to report on your successes, keep the management abreast of what is happening, inform him about how the project is moving, and do it as often as possible.

Remember that the work itself will not tell about the success of the head. And a relative employee who conflicts with you has immediate “access to the body.” And because this employee will complain about you, and you need to tell the leader about the success yourself.

You can reduce the constant reports to informal communication, for example, during lunch. You can agree on regular meetings and reports, for example, on the daily "five minutes". Choose what is more convenient. But do not forget to show the results as often as possible.

Why is it so important to provide information?

You must regularly provide information at least so that, in a dispute with a relative, the manager can reasonably defend your project. Yes, no matter how funny it sounds, but outside the work they are actively arguing about you and your participation in the affairs of the company. And the leader needs your success in order to win these regularly recurring disputes.

In my experience I have long understood such a thing. If they hire me, the company needs a change. And I not only analyze and recommend, I help implement these changes. Usually, the employer understands the need for my help from the employer, since he pays for my work. And employees, including family members, often do not understand why changes have matured and why my work is needed.

In the process it also very often turns out that even the manager does not fully understand what I have suggested, what I am implementing and why. Therefore, in the presence of conflicts with employees-relatives it is very important to inform in detail about your actions and achievements. This is important, above all, for you, for the success of your project.

What is written with a pen ... Or even in a voice recorder ...

Be sure to write down everything you can. Record all the agreements, all the details of the discussions, all the terms and figures that were voiced during the negotiations. Personally, I often just put a dictaphone in a prominent place and record the entire negotiation process. I explain to the customer that this is necessary for further analysis, because I usually conduct interviews, I ask a lot of questions.

In fact, I need this recording not only and not even so much so as not to forget anything, but to fix all the agreements and to reproduce this record in case of conflicts. So far, I have never needed such a decision. Perhaps that is why it did not take that customers remember perfectly, I write everything down.

And remember that the word employee relative has more weight than yours. At any moment he can say that it was you who did not explain him this or that moment, and because of your fault, he understood everything completely differently. And here you can also record your conversation. Therefore, do not be lazy to write down everything you can. This helps to avoid conflicts.

Summary

In conclusion, I would like to remind once again that relatives in business are not necessarily bad at all. If a person loves his business, knows it and is ready to work for the company’s benefit, then his family ties with the management will in no way harm the business. And in some cases they can even help the cause, because a relative would rather allow himself to be criticized by the management than an external employee.

But in practice, cases where relatives in the business benefit, extremely few. And most often in these cases, relatives and friends of a person have been in the company since its inception, i.e. are colleagues, assistants and partners of the businessman.

In cases where relatives of the head come into the established business, it is difficult to do without trouble. And all the shortcomings I listed were based on monitoring the real companies I worked with.
What can advise the head? If, for one reason or another, you still surround yourself in business with family and friends, remember the possible shortcomings of such a solution and try to think in advance how you will solve possible problems. Better yet, hire people to work on the basis of their professionalism, and only then consider some kind of personal relationship.

I advise third-party specialists (business consultants, programmers, implementers of this or that software, webmasters, etc.) to keep in mind the peculiarities of companies where the manager is surrounded by relatives. Of course, it is more difficult to work with such organizations than with companies where all relationships are exclusively professional. But this is not a reason to refuse to cooperate, just do not forget my advice and proceed carefully.