Florin Madar Temad Co and Ruben Marian Utilben , about the challenges of a family business.
Family businesses, while beautiful, are fraught with challenges because most rarely formalize their management structure. Also, with the change of generations there is a difference of vision and divergences and even conflicts can arise. These must be resolved through good communication and by establishing clear rules.
There are numerous challenges within family businesses, considers Ruben Marian, CEO & Founder Utilben, most of the tensions coming from overlapping roles. He points out that the roles must be well defined from the beginning.
“It is not easy to do business in the family, although it is very nice. It’s a big challenge because everyone is well-intentioned and it’s hard to set boundaries between family and business. Often the discussions about the business continue at home as well, so it is a challenge to clearly define the roles. Most tensions come from overlapping roles. (…) In our case, from 2019 I chose to focus on the development side, future vision and talent recruitment, and my wife accepted to take over the role related to the executive of the organization”, declared Ruben Marian.
He adds that different perspectives on running the business complement each other in his case because each “has unique strengths”.
“I’m a visionary, I’m impatient, I’m goal-oriented and I want things to happen quickly. On the other hand, my wife is the one who manages the risk, is very careful about people and invests in them. Basically we complement each other very well and each of us has unique strengths. In the end, the success of an organization depends on the ability to implement and not on the vision.”
Regarding the challenges that a family business encounters at the moment of generational change, Florin Madar, CEO Temad Co, believes that education has an important role for a business.
“The challenges are a little different in terms of going from one generation to another. For this aspect I have a longer term vision. I believe that education is very important for the business to remain in good hands. I believe in meritocracy, meaning the one who inherits a business is not automatically the one who can run it. I want a fresh breath and any new ideas are welcome, although they are not always easy to implement.”
In general Florin Madar does not mix family with the business and even if there are certain differences of vision between the generations he established certain principles from the beginning.
“The difference in generation and vision is a challenge. We bump into differences. Currently the roles are master and apprentice, but as we move forward in the generational change process they will reverse. We got off to a good start by establishing some principles and generally don’t mix family with business.”
The emotional factor and communication are important in a business, especially a family business, says Ruben Marian, and differences of opinion are good if they are constructive.
“If there is no emotional factor, it means that we are not passionate enough. Business is not just about numbers, but also about relationships between people. In our case, I’m the one who generates most of the conflicts because I have big dreams, I want to fulfill them quickly and I’m a little flexible. Because of this, I also have high expectations, especially from the people closest to me. However, I have learned that we need communication, to identify the source of conflicts and to set expectations correctly. After doing this I no longer came up with certain assumptions. Differences of opinion are good in an organization if they are constructive.”
On the other hand, Florin Madar confesses that there were no big differences of opinion in his business, and even if there were, they were resolved through good communication and well-established rules.
“We didn’t have a challenge or big differences of opinion that we had to reconcile. Obviously the opinions are not identical, but in general they were convergent. We have had good communication so far and have not come close to a conflict. As my role in the business diminishes, differences are likely to arise, which I hope do not turn into conflicts. My view is that they need to be resolved on the basis of clear rules that need to be laid down. It is good to have advisers and a shared decision, but the decision must be made in the end. The one who makes the decision is also responsible for it”.
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