Joining a family business isn’t for everyone. It’s a risky decision that needs a lot of careful consideration. You might build a successful dynasty that grows into a Fortune 500 company, with generations of family continuing to lead the business. Or, like the vast majority of family businesses in the U.S., your business might not make it to the second or third generation. Even worse, your family dynamics could break down, leaving a legacy of dysfunction that long outlasts the business.
So how do you decide whether to join a family business? The next generation should consider six key issues before diving in:
1. There can only be one CEO
Think about where you currently stand in the family and where you can potentially go in the business. If you’re in the second or third generation, there may be siblings and cousins all hoping to take over as CEO. Stop and think about whether your goal is senior leadership. If it is, ask yourself if this is realistic. Who is competing for those positions? Is your cousin the “golden child” of the family? Are you the most qualified? Are there family politics involved?
2. Consider working outside of the company first
By working at a different company, you’ll gain experience and knowledge – not to mention objective feedback and evaluations. You’ll get independent verification of your performance and contributions. This translates to more confidence in your abilities if you enter the family business later. Instead of just being the “kid” — the boss’ son or daughter — you’ll bring real expertise to the company and be a respected member of the team. Some family businesses even have a requirement that members of the next generation must work outside of the business for a minimum number of years.
3. Give yourself permission to walk away
The real power of the next generation is that it can walk away from the family business. There are many other options, like working for another company or launching a startup. You need to ask yourself if working for the family business is what you really want to do or if it is preordained. If you decide to walk away, be prepared for some emotional fallout.
Read the full post at Forbes.
Peter Kurzina is a Senior Lecturer at the MIT Sloan School of Management.