Old Guard vs New Order: The Evolution of Work Culture in Family Businesses
“I love you but you are not serious people,” Logan Roy, CEO of Waystar Royco and patriarch of the Roy family, tells his children — effectively dismissing Kendall, Shiv, and Roman’s visions for the future of the company and their own individual plans of succession as CEO.
While very few family businesses are as glitzy and glamorous as HBO’s hit drama Succession, they all carry its essence in some way or the other — a tussle between the old guard and the new order, workplace tensions that spill over into personal relationships, and dreams of a glorious future.
Work cultures in family businesses tend to be centered around the values set forth by the founding members — they’re often traditional, driven by hierarchy, and built on a distinctive purpose that unites every single member of the organization. Nothing brings people together like a shared goal, which is why family-run businesses have it in them to inspire and motivate employees to work together. Especially in small businesses, every individual’s effort matters and each person has a definitive role to play in the success of the organization.
It makes sense that the “we’re a family here” sentiment is the strongest in family businesses — and while it may be based in good faith, it's also easy for this sentiment to blur professional boundaries and create a toxic work environment.
Accountability comes only when there are processes in place to ensure that every employee’s well-being is taken care of — being treated as members of a “family” means that they may be expected to make sacrifices for the organization in ways that employees really shouldn’t be expected to perform. This could mean anything from working on weekends without overtime, the inability to take leaves when required, salaries that are not market-adjusted, or an absence of employee benefits. It’s even harder for those who do actually belong to the founding family as the lines between home and the workplace are blurred, with no way to set professional boundaries or separate family from business.?
How can family businesses bring about a change in their work culture?
Most successful family-run businesses are those that know how to effectively preserve their foundational values and champion them across the enterprise — it's the secret to good branding and helps the business connect meaningfully with its customer-base. However, such businesses should also be able to adapt to the changing times. The workplace as we know it is undergoing rapid changes and companies that fail to evolve will have a tough time securing their future. With greater mental health awareness and organizations increasingly prioritizing the well-being of their employees, companies that don’t join this bandwagon will be missing out not just on profits but also the best talent. Family businesses must be willing to come out of their traditional understanding of the workplace if they want to ensure employee retention and increased productivity; they must be willing to transform their work culture from one that places the family and its values at the top, to one that is inclusive and prioritizes the well-being of each individual in the workplace.
Below are some elements of a winning work culture that family-owned businesses should ideally adopt if they wish to keep growing and position themselves as leaders in their industries:
- Build an open, psychologically safe organization: It goes without saying that organizations that practice open communication and celebrate diversity fare better at employee retention than those that don't. Most business leaders, of family-owned businesses or otherwise, find it difficult to be wholly honest about to their employees about the challenges faced by the organization. But it's worth noting that employees appreciate and relate more to leaders who are comfortable with vulnerability and openly talk about challenges. Founders might think that employees don't understand the essence of the business as well as they do, but opening up about such big-picture issues can help create a two-way dialogue, increase transparency, foster team bonding, and ultimately bring diverse perspectives. Additionally, when founders and leaders open up about challenges in their personal lives, it sends a sign to employees that the workplace is a safe space to discuss issues related to well-being. Your own empathy, vulnerability, and honesty can help build an organization where every employee feels empowered to seek support for personal well-being in addition to professional support.
- Embrace flexibility: A lot of family businesses tend to function on the logic of "if it's not broken, don't fix it." While this may be the right approach in several situations, it causes family businesses to lose out on organizational and process efficiencies as they hold on to the familiar. To bring about a work culture change in their business, these founders must be willing to let go of the past and allow room for flexibility and growth. Flexibility means something as simple as allowing people to choose their preferred working hours, offering hybrid work models, and providing employees with opportunities to dabble in other interest areas within the firm. Flexibility shows people you really care about their growth and are invested in improving their ability to perform at maximum potential.
- Learn to handle generational conflict: Generational conflicts are the hallmarks of every family business. As the new generation prepares to take over from the old, conflicts in leadership and management styles arise. The old guard is uninterested in the ideas of the new generation, while the latter is impatient to get the ball rolling. To effectively handle such conflicts and to build a culture of inclusivity, both sides must be willing to hear each other out without letting their biases kick in. The older generation should provide the new ones with opportunities to innovate and implement newer ways of working, and the young guns definitely could learn a thing or two about leading with efficiency and values.
- Focus on employee well-being: Competing against multinational firms for the right talent is a major challenge that family businesses face. Investing in employee wellness programs helps ensure that current employees feel appreciated and taken care of, while also attracting new employees as more people begin to prioritize their mental well-being over professional success. These programs encompass the holistic growth of every employee within an organization. Employee well-being is about more than just enticing benefits packages; it's about creating a culture where the overall goals of the organization are deeply intertwined with the best interests of each employee. It helps ensure that an employee's time, physical and mental health, and individual growth are not constantly sacrificed at the altar of profits, and that they have a working mechanism to seek the right kind of help whenever they need to. Re:Set offers bespoke employee wellness programs that can be easily customized to the unique needs of family businesses, and our Organizational Policy Framework assists with building new or strengthening existing well-being policies as well as implementing organizational strategies to help leaders stay on track with the revenue and well-being goals of the company.
- Upskilling: As family-run businesses often feel the most comfortable sticking to traditional ways of working, things can start to feel stagnant within a few years for employees who want to do more. Upskilling opportunities offer a great way to not just help employees focus on self improvement, but it also allows the company itself to explore new areas of working and opportunities for growth. This can be achieved by setting annual targets for professional development of each employee, organizing trainings and workshops on industry hot topics, mapping career trajectories for job roles to help employees understand where they are and where they're headed, providing cross-teaming opportunities to diversify skills, and many more.
Providing the right kind of upskilling opportunities that are aligned to your employees' interests also shows the organization's willingness to invest in their professional growth, and this acts as an effective motivator for employees to help grow the business in innovative ways.
