Family businesses are often described as the backbone of the Australian economy and the cornerstone of many legacies. They represent 70% of all businesses and employ 50% of the workforce.
At Stephan Independent Advisory, we know firsthand how rewarding they can be – we’re a family business ourselves. When they work, family businesses have the potential to bring loved ones closer together, create shared purpose, and secure financial futures across generations.
But let’s not sugar-coat it: family businesses require effort, intentionality, and communication to thrive. Without clear boundaries, aligned goals, and mutual respect, they can become a breeding ground for conflict, stress, and strained relationships.
Why family business can be challenging
Combining family dynamics with business operations is no small feat. Unresolved family tensions can spill into the workplace, and professional disagreements can strain personal relationships. Without proper communication, shared values, and agreed-upon objectives, it’s easy for these complexities to create friction.
Different expectations about things like leadership, decision-making, or financial roles can lead to misunderstandings. And without clear boundaries between work and family life, it can feel like there’s no escape from business issues, which can overwhelm personal connections.
Philip Pryor – CEO of Family Business Central – and I had a conversation about this in a recent episode of It’s Never About Money. We talked about how unspoken tensions in family businesses can escalate when roles, responsibilities, and expectations aren’t properly defined. His advice? Treat your family business like any other business – establish clear structures, communicate openly, and don’t let personal relationships dictate professional decisions.
The key to making it work
Despite the challenges, family businesses don’t have to lead to conflict. With intentional effort, they can instead foster some of the most fulfilling and productive relationships you’ll ever experience. The success and sustainability of our family business is predicated by three aspects:
- Strong Communication
Open and honest conversations are critical. Whether discussing business strategies, succession plans, or individual roles, clear communication ensures everyone feels heard and valued. Regular meetings – separate from family gatherings – can keep work discussions productive and minimise personal tension. - Defined Boundaries
Separating work from home life is essential for maintaining harmony. Agree on when and where business matters are discussed, and protect family time from being overtaken by work issues. If I am out to dinner with my brother, James, I don’t want to be discussing business, I want to be enjoying family time with him. These boundaries create balance and prevent burnout. - Shared Values and Goals
A family business thrives when everyone shares the same vision and works toward common objectives. Establishing a clear mission statement or family charter ensures alignment and helps resolve disputes by referring back to agreed-upon principles.
Why family businesses are worth it
When done right, family businesses are more than just financial ventures – they’re opportunities to strengthen bonds, build legacies, and achieve something meaningful together. They offer the unique chance to work with people who share not only your goals but also your values.
At Stephan Independent Advisory, we’ve seen how beautiful and impactful family businesses can be. They require effort, yes, but the rewards are more than worth it. With the right communication, clear boundaries, and aligned values, family businesses don’t just succeed; they thrive.
So, is a family business a good idea? Absolutely. But it’s also a commitment to intentionality and teamwork. With those, it can be one of the most rewarding experiences of your life.
