5 Tips for Working With Family and Friends

Date: February 11, 2010

It's not uncommon for small business owners to hire family members or friends. Though not necessarily a bad idea, business owners can find themselves grappling with a conflict of interest that can potentially damage the personal relationship. You can avoid personal awkwardness by putting a few guidelines in place. When business is involved, here's how to make sure your personal relationships run smoothly.

1. Hire based on merit. There's nothing wrong with hiring family members or friends as long as they are qualified. Before making a hiring decision, consider the criteria you would use to evaluate any job applicant. Then, see how your family member or friend stacks up. If you have a hard time being objective, create a hiring team that will look at every candidate in an unbiased manner. If the only reason you hire your family member or friend is because of your personal connection, that person may ultimately hinder your business's growth.

2. Set boundaries early. The best time to establish the parameters for any relationship is when the relationship begins. If you start off giving your family member or friend special treatment, he or she will expect it throughout the course of the business relationship, and that may not be in the best interest of your company. Determine how the two of you will work together and have an explicit discussion about what each of you expects from the working relationship. When expectations are not met, discuss adjustments that can be made immediately.

3. Be open about the relationship. If you hire a family member or friend, let other employees know about your relationship to the person, but also let them see that there will be no favoritism involved. If other employees think you're playing favorites, that could discourage them and lead to a decline in their productivity. In worst-case scenarios, it could even lead them to look for employment elsewhere. Make it clear that during business hours, every employee is treated equally.

4. Consider using a mediator. Instead of being the person to deal directly with your family member or friend, have another trusted employee serve as a direct manager or work closely with that person. Not only will it be easier to convey information that your family member or friend may not want to hear, but you'll be able to keep an arm's length distance between the two of you and there's less likely to be perceptions of favoritism.

5. Differentiate business discussions. Once a family member or friend starts to work with you, there may be times when you will have to have discussions about business or work performance. Such conversations should have an entirely different tone than personal conversations would. Come up with ways to differentiate these discussions by designating certain settings for discussing business. For example, you may have business discussions in a conference room or set up specific times to address work matters. At all other times, the discussion of business would be off limits, allowing your personal relationship to continue to flourish.

Working with family members or friends can be a rewarding experience for all involved. By taking some time to establish guidelines, you can make sure both business and personal relationships continue to flourish.

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