Dangers of Poor Employee Communication in a Family Business

“We turned her down, and later found out she had approached the union, to stage the union drive, in order to win her job back.”

As family business entrepreneurs, we often tend to manage by hunch, figuring things out as we go along, especially in the earlier startup years. Many of the issues we face as our businesses grow; we plod through, without much advice from outside advisors. Surprisingly, most of the time it works out well. For our family business, this time it didn’t.

We had been in business for about 15 years, and our compensation plan was pretty basic; salary plus a holiday bonus. The bonus was pretty much automatic. One year we decided to revise the bonus portion, realizing that as longer-term employees’ compounded wages increased, it was increasing the bonus portion disproportionately. We decided to cap the bonus for the highest paid managers.

One of our long-term managers became upset with the new bonus program and decided to leave the company.

About six months later we had a group of employees, petition for a union organizing More…

ADVISORY BOARDS: Not Just for Big Companies Anymore.

DO YOU EVER catch yourself saying, “why change, we’ve always done it this way” or “I mentioned that idea before, but no one listened” and “I wish we could do this, but it would hurt his feelings?” As small businesses, we have a unique ability to make clear- cut decisions and not get caught up in the bureaucracy. Unfortunately, this same advantage also goes against us, when we are faced with growing the business and making critical decisions. Everything works well when we are in agreement with each other about the strategic direction of the business. But when we are not on the same page, we get bogged down making decisions and deciding on the direction of the business, because our personal feelings often get in the way and impede us. More…