How to Extend the Life of Your Family Business

Family Business Longevity article banner from Ferguson Alliance

Family business longevity |Ferguson Alliance

During the 1950s, the average lifespan of a family business was 60 years, while in the present age, that drops to just 24 years. So, what can be done to combat this figure and increase the livelihood and likelihood of success for your family business? Ferguson Alliance has six key ideas of what to focus on. 

1. Accept and Steer Change 

Resistance to change is often one of the biggest challenges that family businesses face when planning for the future. A refusal to embrace change and transition accordingly can cause far more problems than making the change itself. Doing so can set your company up for failure if you’re unprepared for an inevitable situation, such as succession planning. 

2. Preserve Healthy Financial Affairs 

A healthy financial plan and portfolio are necessary for any business, including family-owned ones. No matter the timeline you’ve set for your family business, nothing can come of it if you run out of money. Therefore, it’s important to protect the future by practicing and maintaining healthy financial fundamentals over both the short- and long-term. 

3. Hire Based on Cultural Fit 

Finding employees that fit your organization’s values, vision, and goals is a crucial part of ensuring your business has a long lifespan. It contributes to the success of the individual, their team, and the company as a whole. Disregarding the importance of cultural fit can lead to employees not living up to their potential and struggling to develop in their positions. 

Cut Flowers Gain a Following as an Alternative Crop for Farmers

4. Build Toward Cross-Functional Management 

A good business should function as a well-oiled machine, but few live up to that goal of seamless communication and integration. To develop harmony and build toward cross-functional management teams, there needs to be an awareness on both sides (supervisor and employee) of the responsibilities of a position and how it impacts the business at all levels. 

5. Find a Balance Between Adaptability and Organization 

The longevity of a business requires a balancing act between the needs of flexibility and structure. Flexibility is the ability to adapt and change to new developments, while structure maintains a solid and sturdy foundation for your business. 

Having too much structure without flexibility makes your business too rigid and unable to adjust and reshape itself when needed. Meanwhile, too much flexibility without structure creates a deficiency of authority that’s needed to drive your business and clearly communicates what you stand for and aim for. 

6. Decide What Kind of Company You Want to Be 

Ferguson Alliance, as a company and as a collective, believes that family businesses can live forever. But only if people don’t get in the way of the plan to keep it going. The secret to prolonging the lifespan of a family business comes down to the following questions: 

Do you want to be a family-first business? 


Do you want to be a business-first family? 

For additional information and an expanded look at the topic of building the future of a family business, make sure to read the original article on the Ferguson Alliance website, which also features video explanations from the firm’s team on each of the six aforementioned points. 

Source link

About The Author

Scroll to Top