Formalities commonly do not exist or are lacking in family business environments. For example, we often see no clear direction about what each person is supposed to do, how to get it done, or what they are getting paid for, which opens the door for underperformance and distracting conflict.
Consolidation amongst Public Groups and major national brands is putting pressure on smaller family-owned dealerships. The ongoing consolidation trend is providing bigger groups with efficiencies and cost savings, allowing the big brands to capture more and more market share of customers and talent. As such, smaller dealers are in the position to either buckle down on driving key performance metrics or get left behind.
Lack of formalities generally results in enablement, inconsistent policies, nepotism, and toxic family/business interactions, which impacts performance and will cause good and mediocre talent to leave your business for a better gig. Without people, family business owners will struggle to compete, and the value of the business will decline. So succeeding or selling out for the highest dollar depends upon an attractive culture that retains employees, has good standing in the community, and performs well.
Often the key ingredient found in high-performing organizations is Culture. You will stand out in your community if you are good to your people and customers. The following are a few core areas to focus on to professionalize your family business:
- Develop job descriptions for all positions
- Identify and live by core values
- Create standardized processes and procedures
By professionalizing the family dealership and integrating standardized processes, you can run your business efficiently and replicate processes if you choose to grow through acquisition.
In this episode, Pete Theil with Haig Partners and The Rawls Group’s succession planner Champ Rawls discuss business fundamentals that must be formally adopted for family-owned dealerships to succeed.