Family values are fundamental to the success of a family business, providing a strong ethical foundation and creating a positive company culture. These values integrate into every aspect of the business, from decision-making and operations to relationships with employees, customers and vendors. Incorporating family values into the core principles of your business is crucial for ensuring its longevity and sustainability.
Here are some key values that can help grow and maintain your business effectively:
- Integrity & Ethics– Upholding honesty, loyalty and strong moral principles can lead to a strong ethical culture.
- Trust & Respect – Building and maintaining trust as well as valuing and considering the opinions and contributions of all employees, customers, vendors and stakeholders.
- Responsibility – Taking accountability for actions and decisions and being reliable.
- Commitment – Demonstrating dedication to the business, its mission and goals, and its people.
- Work-Life Balance – Ensuring that employees have a healthy balance between work and personal life.
- Community Involvement – Engaging with and contributing to the local community.
- Perseverance – Prioritizing problem-solving, communication, resilience and adaptability for long-term sustainability.
To effectively integrate family values into a business, they need to be clearly articulated and communicated to all employees. This helps create a positive work environment, build strong relationships, and drive long-term success. Here are some ideas on how a family business can uphold these values:
- Create a Values Statement – Clearly articulate the family values in a written statement and ensure it is communicated to all employees and stakeholders.
- Lead by Example – Family members in leadership positions should model the values in their daily actions and decisions.
- Transparent Communication – Open communication within the business is crucial for aligning everyone’s vision and goals.
- Incorporate Values into Policies – Integrate the values into company policies, procedures, and codes of conduct.
- Recognition Programs – Recognize and reward employees who exemplify the family values in their work.
- Community Engagement – Actively participate in community service and charitable activities that align with family values.
- Work-Life Balance Initiatives – Offer flexible working arrangements and support for employees to maintain a healthy work-life balance.
By integrating these practices, a family business can maintain its core values and ensure they are reflected in every aspect of its operations. While implementing core family values in a business may present challenges, it also offers numerous opportunities for growth and harmony. Employees may initially resist changes, but with clear communication and alignment with business goals, they can become strong supporters for these values. Leaders who model the values set a powerful example, fostering a culture of accountability and integrity.
Succession Planning with Values in Mind
Families that integrate their values into their businesses significantly shape the success and direction of the business. Therefore, it’s important to consider these values when forming a succession plan. Effective succession planning is vital for preserving family values, as this solid foundation can lead to increased profitability, enhance the financial value of the business, and ensure long-term success.
Planning for leadership succession should involve selecting candidates who align with the family’s core values, not just their skills. This ensures that future leaders align with the core values and are well-prepared to lead, contributing to the continued success and sustainability of the family business. Professional guidance can provide valuable insights and support, helping to navigate the complexities of the process. To facilitate a smooth transition, seeking guidance from a professional team, particularly a Certified Public Accountant (CPA) firm with expertise in family business transitions, can be highly beneficial.
In conclusion, core family values play a crucial role in shaping the success and sustainability of a family business. By instilling these values, businesses can build a strong ethical foundation and adopt a positive company culture. These values should be clearly articulated, communicated, and integrated into every aspect of the business, from decision-making and operations to employee and stakeholder relationships.
Maintaining these values requires consistent effort and dedication. By embracing these practices, family businesses can ensure their values are upheld, creating a thriving and resilient organization that stands the test of time.
Ursula Scroggs, CPA, is managing director at DKSS CPAs + Advisors, with offices in Troy and St. Clair Shores, Michigan. Jean Stenger, CPA, is director of operations for DKSS.
