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1. Assuming all genetic relationships equal good working relationships.
We assume that all genetic relationships equal a good working relationship. This is not true. Just because you are related to someone, doesn’t mean you should be working together. Acceptance in a family is unconditional, but acceptance in a business is conditional. It is not a birthright. A place in a business is something you earn. Family members should get their start in a business doing physical labour, then begin to manage, and then occupy a leadership position. Finally, senior family members should become labour once again, if they want the business to continue with new leadership. Be a business-first family, not a family-first business.

2. Believing the business can financially support any and all family members who want to work together.
If the business is going to continue with a new generation, senior family members must have secure financial assets. In order to achieve this, senior members need both a financial planner and an accountant and at least 50 per cent of their income should be derived from somewhere other than the farm. This way, the new leaders of the farm can take calculated risks, without putting all of the senior members’ assets at risk. Secondly, a family business needs to be financially strong before bringing a new member onto the team. This person also needs to be independent, experienced and bring something needed to the business. If your mother’s still doing your laundry, you’re probably not ready to be employed at the farm.

3. Assuming others will/should/must change – but not me.
You do not farm the way your parents farmed, they did not farm the way their parents farmed and neither will the generation that you bring in. When you bring someone into the farm, you are no longer independent. You are interdependent. There has to be negotiations as a family farm makes the transition between generations.

4. Presuming a conversation is a contract.
Please get things in writing. Believe it or not, farmers and ranchers lie. Here are the three biggest lies in agriculture: Firstly, “Work hard. Someday this will all be yours.” Secondly, “I’m going to retire.” Lastly, “Don’t worry about your brothers and sisters. They have their jobs. They’re not interested in the business.” All good businesses have things in writing. If you are a corporation, you don’t just need articles, you need adopted by-laws. Keep minutes of the meetings. Have all the contracts in a place where they can be read and understood. Have job descriptions, a business plan, goals, compensation packages and many more things in writing. Words in a conversation sound good, but words in a contract make sure your word is good.

5. Believing mind reading is an acceptable form of communication.
When you have other forms of communication available to you, use them along the way. Mind reading is not enough. Communication is the bloodstream of your business. Here are three ways to use it well. Use daily interaction for information, coordination and participation. Use meetings for inclusion, goals, standards, evaluation and synergistic decision making. Share relevant information with your business team, your key advisors and non-business family members. Use these methods of conversation instead of mind reading.

6. Failing to build communication skills and family meeting tools when the times are good, so they’ll be in place when the times get tough.
Family meetings must take place when the times are good and the tools are in place. Make a contract for communication. There should be a code of conduct that comes with communication. Correct in private what you would praise in public. Make an overview of the business. Hang a board with meeting topics at your business. Whenever you want to talk about something, circle it. If nothing is circled, don’t meet. Communication is key.

7. Ignoring the in-laws, off-site family and employees.
These three groups can be your best friends or your worst enemies. In-laws need to be embraced. Otherwise, when there are problems at home – and there will be problems at home, there are problems in the business. In order to move forward, these questions need to be asked: What is the role of the spouse (in-law) in the business? Spouses can bring a lot to the team and if they can be incorporated, they can be really important. What are the spouse’s (in-law’s) expectations of the business? People want security. Specifically, it can be an issue for an in-law if the business owns the house in which they live. Do off-site family play a role in the decision making or current or future ownership? Regardless of the expectations of off-site family, 51 per cent of the power of the assets should remain with the family members that are involved in the business. You must be clear and upfront in answering these questions.

8. Forgetting to use common courtesy.
Common courtesy represents your lowest cost and your highest return. People often treat strangers on the street better than they do family members. You say “please”, “thank-you” and “good job” to other people, but how often do you actually do that in the family business? Crops and critters can be bought or sold and land can be managed by many, but it is the people in our hearts, not the land, that gives us the most joy or the most pain.

9. Having no legal and discussed estate, management transfer plan or buy/sell agreement.
Parents do not owe their kids a business. Parents owe their kids morals and values, an opportunity for an education, legally discussed and revised plans, and a listing of details. This is where these plans and agreements come in. Buy/sell agreements need to be outside of the will, because wills are changed on a whim. In most cases, your will is your private business. However, if you want your business to continue and the distribution of assets in your will affects that continuation, then your will is no longer private. It must be shared. These plans and agreements need to be legal, discussed and revised.

10. Neglecting vital facts of successful family business.
So many families neglect the vital facts of what is needed to be successful. Specifically, understanding the difference between fair and equal and pausing to applaud and celebrate. Equal is giving everyone the same sized piece of pie. Fair is giving those who farmed the apples to put in the pie bigger slices in appreciation of their hard work. Finally, make sure you celebrate both the big and the little things along the way. Take the time to applaud.

Adapted to text from a Farm Management Canada Agriwebinar presentation by Jolene Brown  – Click here to watch the webinar.