How To Run A Successful Family Business

Kenyans are very enterprising and many are involved in some kind of business. The common practice is for different family members to run small, independent businesses (one deals in shoes, another one ladies dresses while yet another is in the green grocer business). 

How can family members run a successful business together? Family businesses range from parent-children partnerships, sibling partnerships, husband-wife teams and much more.

So, can family members work together to build a successful business?

According to Forbes magazine, Bidco Oil Refineries, the Kenyatta Family Business and Ramco Group in Kenya feature among the leading family businesses in Africa.


Leadership needs to be very strong for the business to survive through the generations. Putting leadership in place should therefore not be taken lightly and should preferably involve independent professionals to guide the family through the selection process.

Systems need to be put in place right from the beginning. To put up a building that will weather the storms, it is important to start with a strong foundation. Starting the business without seriousness then trying to streamline things later will most likely be met with resistance.

Everyone in the team has different skills and expertise to bring on board but not everyone is a good leader. Selecting the right leader will make or break the business. The leader needs to have vision, to anticipate change that comes with growth and to plan for it.

A leader sets the pace for the team, walks ahead with a flag showing the way, he does not follow behind with a whip complaining about all that is going wrong.

Some family businesses fail because of selecting the leader based on the family relationships rather than competence. Being the eldest brother in the family or the father does not necessarily make one the obvious leader of a family business; skills and experience do.

To keep the team united and focused on the same goal, the leader needs to be a good leader, to have a sense of fairness and to be passionate about the business.


Many family businesses fail because they are operated like relationships rather than as businesses. No official working hours, no properly designated working space, no official documentation of anything including operation procedures, job contracts, roles and responsibilities, disciplinary measures, salaries and benefits and other expenditures. 

Starting a business without systems leaves room for manipulation and misinterpretation and causes misunderstandings afterwards.

Allow as much discussion about the expectations as possible especially in the initial stages. Never ever work on assumptions. Clarify expectations as early as possible. 

Have everything written down and discussed in detail. Have a lawyer to work with who helps you to make everything official even job contracts. When it is official, the team will respect the positions. Your family business is competing with other companies in the niche so complacency will only lead to loss and failure.

Everyone needs to be on the same page about the running of the business. Everyone can face disciplinary measures and can get fired. The fact that they are family members does not mean that they can break rules and get away with it. 

Guard against any kind of favoritism and privileges. Follow the same procedures for everyone working in the business whether they are family or not. There is no mixing family with business so if someone uses differences from the family to settle scores in the business, disciplinary action should follow. 
This needs to be clear from the beginning. Do not wait until one family member tells another off about some personal things before you put measures in place to correct the situation.

Performance expectations and disciplinary measures must be understood from the beginning. With a clear leader, this should be easy to handle. It should also be clear that the family and the business are two completely different entities. 

The fact that one is the dad or the husband at home does not apply in the business. He is the operations manager in the business and he obeys the rules of the organization.

Keep Family and Business Apart

As you set up a family business, do not bring in just any family member simply because they are idle or available, or because they are facing financial challenges and need income. 

Imagine a scenario where you had a family member who was out of job and you saw an advertisement for a job in a popular media house of commercial bank. Would you put in an application for that family member simply because they are out of job?

Someone must be qualified for a job before they can be selected to fill a post. Suitability is about many things ranging from academic qualifications to personality. If someone has no track record of being productive, do not go into business with them. 

Don’t expect to get an idler and lazy or quarrelsome person to suddenly develop a working culture simply because they are now part of a family business. If someone cannot work, they will not work no matter what you do.

Do your research well and come up with a workable organizational structure. Do not create positions to take care of available family members but rather identify the skills and expertise the business needs and identify if anyone in the family has them or you need to outsource.

Keep Track of What The Competitors are Doing

Have very frequent evaluation meetings especially in the initial stages. Don’t base your success on irrelevant facts such as being in agreement. Evaluate using real results such as income from sales. 

Keep up to date with what is happening both locally and globally and constantly compare the performance of competitors with your business. Can you compete favorably? 
You could be agreeing on just about everything simply because you come from the same family and have similar outlook to life but is that giving you the results that the business needs to become profitable?


Never stop working on your communication skills. Be especially alert to barriers to effective communication such as assumptions resulting from too much familiarity. 

Work with professionals as much as possible. Hire non family professional members for sensitive positions such as handling finances and have very clear systems in place. 
Always remind yourself that if your business does not make profit you will close down and that should keep you going even when you feel like a family member knows you too well and will not respect your opinion. 
When you are working in the business you are a professional and any matters from home have no room. Stay firm always and never allow any family member to distract or derail you.

At the end of the day, a business can fail or be sold but family will still be family so do not destroy your family in the name of business. Agree right from the beginning that you will keep family and business separate. Do not drag each into the other. If you are family away from the business, do not drag business matters there. 

Family is family and business is business. Be firm always and do not allow the rules to be broken. If a family member brings up a business issue during family time, stand firm and make it clear that the matter will be discussed during working hours. 
Having a designated working space for the business that you set aside for business operations helps to keep family and business separate. Also have telephone line that is strictly for business, set business hours and do not bring the office telephone into family time. 
When you are in the business, be there 100%. The same case applies to family. 

Susan Catherine Keter is a life coach, mentor, motivational speaker, freelancer and blogger.

Financial Independence Africa

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