When I hear people say “never work with family”, I just shake my head and couldn’t disagree more. But I guess that for me, this is personal.
My father, Magdy Stephan, founded our first financial planning group in 1995. He believed in providing truly independent advice, no matter the cost. Even when he was diagnosed with a terminal illness, he fought against the odds for another decade, giving us the time to learn from his wisdom and ensuring we had the tools we needed to take over the reins.
That experience shaped me into someone who is committed to helping other family businesses thrive and build wealth legacies. Listen to my chat with Peter Winneke where he talks about building a legacy of generosity.
So when people say working with family has its disadvantages I say “sure”. I’ve written about why family businesses fail (and how you can avoid it) before (you can read that here).
But they have their own unique advantages as well.
Here are just three, I’m sure there are more.
Advantage No.1: Comfortable with Conflict
As kids, brothers and sisters can be at each others’ throats one minute and then best mates the next.
Same with parents and their kids, fights and disagreements (and door slamming) may occur but most of the time it is soon forgotten. Water under the bridge.
This dynamic gives family businesses a unique advantage. They can often have quite robust disagreement and confrontation with the safety of a whole history of resolving conflicts. Their past experiences create a culture that is comfortable with intense conversations or conflict.
Sure, the flip side of that coin is that they can bring a whole lot more past history into the equation, compared to non-family businesses.
But, most family businesses are comfortable with getting back to “status quo” quickly after a conflict.
And, every business is going to face big challenges at some point, which can often lead to conflict among people within that business.
Being able to have that conflict and come out the other side quickly (and in an even better position) is definitely a family business superpower.
Advantage No.2 Deep Emotional Motivation to Succeed
As many of you may know, as well as running Stephan Independent, I also make and host a podcast called “It’s Never About the Money” where I get to talk with some incredible people and find out what makes them tick, what really motivates them to succeed. I have realised – for the most successful people, it’s always about more than just money.
Which brings me to advantage number two.
Family businesses often succeed because the motivation to do well comes from a deep emotional connection to the company and its future. It’s not just about the business—it’s about taking care of the people who are closest to you.
Family members often work harder and are more willing to make sacrifices because they are invested not only in the business’s success but also in the well-being of their loved ones.
For me, my drive to see Stephan Independent Advisory grow stems from the emotional bond I have with my family.
The business represents more than just financial success—it’s a way to honour my father’s legacy and ensure that future generations benefit from the hard work he started.
This personal investment creates a sense of responsibility that pushes family members to do their best. They don’t just work for the business; they work to ensure that the family and their values are upheld.
Advantage No.3 It’s a safe space
In family businesses, there is often a more supportive culture than in many corporate environments. Employees feel more comfortable being vulnerable, admitting gaps in their knowledge, and asking for help. This openness fosters an environment where personal and professional growth can flourish.
In contrast to corporate settings, where fear of exposure can lead to competition and secrecy, family businesses naturally lean towards a collaborative environment.
Because of the strong relationships between family members, there is a greater emphasis on helping each other grow. This includes identifying gaps in knowledge and skillsets and providing the resources to fill them.
Family businesses typically have less of a hierarchical structure, which allows for greater flexibility and a stronger focus on the welfare of employees. Everyone has a vested interest in helping each other succeed, and that creates a healthier and more productive business environment.
Disclaimer: Family Businesses DO Still Fail (Without a Good Plan)
Despite these three unique advantages, family businesses do still face the prospect of failure. And just like they have their own unique advantages, family businesses also face their own challenges that are particularly relevant to them due to their family dynamics.
These include poor governance, a lack of succession planning, emotional decision-making, and perhaps most importantly the difficulty in managing leadership transitions between generations.
Without a clear roadmap for leadership transition, family members may struggle with power dynamics or find themselves unprepared when the time comes for change.
Without a well-thought-out succession plan, the business can lose focus, leading to disarray or even the dissolution of the company. If you want to avoid these outcomes, you should start by reading this article Why Family Businesses Fail (And How To Avoid It).
But despite these challenges, helping family businesses navigate these pitfalls is what we do best. Over the years, we’ve worked with many of Australia’s most successful family businesses to guide them through succession planning, governance, and conflict management. If you would like to discuss your own family business situation you can contact us here.
My father’s values, taught through experience, are woven into everything we do at Stephan Independent Advisory. Helping family businesses manage their growth and transitions is not just a profession — it’s personal.
