How to improve decision making in family businesses
Have you ever felt fatigued after going through a crucial decision-making process? If yes, there is a probability that your methods need updating. Making the right decisions might be tricky, particularly in a family business, considering the dynamics and the kind of decisions, for instance, succession planning or financial growth of the family business.
While decision-making might seem unchallenging, it can become quite the opposite once you delve into it.
Formalize your communication
No matter how strong your familial bonds are, keep the functioning formal in a family business. Decision-making involves immense amounts of dialogue and discussions among members. The blurring of personal and professional boundaries can hamper the quality of your decisions and, in cases of conflict, affect your personal lives too.
Furthermore, decision-making happens between both family and non-family members. Carrying out such processes at home with family can make room for exclusion. Communication in family businesses can be made effortless through family business courses in India specific to communication and harmony.
Specialization helps!
There will be several decisions in which you or the core members do not specialize. Suppose your family business is trying to venture into new, unexplored markets. In this instance, you need individuals who know the market, demographics, growth possibilities, that is, who specialize in that domain. The inclusion of specialization will only improve your decision-making processes.
Structured mechanisms
Has a roadmap in place ever disappointed you? So, have one for decision-making as well. An established mechanism with some procedures defined will refine and steadfast decision-making. Such procedures could be anything- unilateral decision-making, consensus, voting, or a family governance ‘constitution’ in place. Learn more about governance in family businesses through courses for family businesses.
Diversity of opinions
Unilateral decision-making can be essentially productive, but it depends on a case-to-case basis. Complex decisions require a high degree of involvement by other members. Individuals with similar opinions can promote confirmation bias, to which family businesses are more prone. Hearing arguments from the other side will improve objectivity and the quality of your decisions.
Hear your next-gen!
You do not have to make every decision alone; your next-gen might have ideas too, sometimes more innovative to tackle complicated decisions. Delegation of tasks to the next generation will yield staggering results for your family business. Involving next-gen becomes easier once you get aware of the know-how.
Family businesses have an edge in decision-making due to the deep levels of trust between the family members. A balance between the pros and cons is imperative to counter the threats posed by lack of formalization. If you are developing structures for decision-making, look no more! Kin & Kith is a platform for family businesses to face a host of related challenges through family business courses.
Get ready to start the improvement journey for your family business with established family business experts!
Want to know about communication lesson for family business? Learn here.