Nepotism: Pros & Cons of Working with Family

Nepotism can be hiring or creating positions for a friend or family member that may or may not necessarily possess the right skills or training. It’s a very complex subject, with very few laws regulating it. If you are or are considering working with family, it’s important to realize the benefits as well as the pitfalls of nepotism.

I’m very fortunate to learn firsthand from my extended family, how creating a company with a spouse and employing your children can be very rewarding and at the same time, extremely challenging. The situation lends itself to one taking advantage of the other, animosity among non-related employees feeling unfairly treated and exposing major conflict or family drama at the job.

Working with your children

Despite those pitfalls, 88% of business owners, assume one day that their empire will be passed down from generation to generation. As part of that 88%, when my only daughter was young, I envisioned her taking over my business someday. It never occurred to me, when that day came — she wouldn’t have any desire whatsoever taking over for me. As a child, I thought she liked going to work with me, only to find out ten years later that she never enjoyed it and equated it with torture. It was then that I knew forcing my daughter to follow in my footsteps would be a bad decision. Especially after I learned only 30% of family owned businesses survive when the second generation takes over. It only gets worse from there, with only 12% still open with the third generation and 3% of all family businesses lasting until the fourth generation or beyond.  Bottom line, if your children don’t have the same enthusiasm as you, your company is most likely to be gone by the time your grandchildren are able to succeed. Those hard facts alone confirm it’s wise to allow my daughter to pursue her dreams – not mine.

Working with your spouse

Marriage and relationships can be difficult and challenging without the added stress of running a business together. That’s a big reason my ex-husband had his own career while I began building mine. Knowing his personality, I knew we would be butting heads constantly and that animosity would follow us back home, creating more stressful problems. It’s easy to say once the work day is over to leave your arguments and frustration at the office. However, I find shutting off the business arguments you had only two hours ago to be unrealistic. How do you sit down together for pleasant dinner when you keep thinking about the mean criticism you endured because you ordered the wrong flowers?

While I knew building a business with my ex-husband wasn’t a good idea, roughly 1.4 million couples are taking that challenge. There has to be some benefits to partner with your significant other if more than a million people are doing it. The first benefit is being able to spend more time together. You share the same commitment and goals to succeed, have a flexible schedule to take vacations together, and can leave work for any situation while the other covers for your absence.

There are many examples of power couples that prove husband/wife nepotism can bring one or the other more success together rather than alone. Donald and Ivana Trump are a good example.  During their marriage, they supported each other by knowing each other’s strengths and weaknesses while working together on major renovation projects. Because of the respect they had for each other, even after divorce, Donald hired Ivana to run Trump Castle Hotel and Casino which achieved the status of 7th most luxurious Hotel worldwide. According to health professionals and life coaches, when a couple is in business together, they should realize each other’s attributes and divide the company responsibilities accordingly. Having separate responsibilities, defined roles and different interests outside work is crucial for a successful business and more importantly, a happier marriage. Taking Donald Trump’s advice, working with your wife can be very lucrative, but always have a contingency plan with a prenuptial.

A number of studies show the divorce rate for couples working together are no more than the divorce rate of the average marriage. If your relationship is healthy, and you are able to avoid bringing family drama into the workplace, running a business together offers the best of both worlds: working as a team to achieve each other’s financial dreams with someone you love and respect.

Featured image by Chris Parfitt

Sherry has been part of the interiorscape industry for over fifteen years, starting at an entry level job at North Florida's largest greenhouse and currently owning two horticulture companies. At UMaine, Sherry majored in English where she worked part-time writing scripts for a local college TV studio.

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