Don’t Assume that Joining the Family Business Means You’re Set for Life

Image Credit: Pixabay

Entitlement breeds resentment, resentment breeds dysfunction, dysfunction leads to failure.


Being part of the family business is a blessing for most family members, but it can be a curse for others. There’s the obvious trap of being roped into the family business even though it wouldn’t have been your ideal career choice, but there are three other traps that can cause a lot of misery for the employee and the company if they aren’t avoided.

Your Last Name is Not Your Claim to Fame

My father, Pat Armentano, founded the company that would later become Paraco Gas on a few basic principles. One of those was respect. Respect was his most important value and how you respected others and how others respected you told him a lot about your character.

One thing he taught me about working for, and later managing, a family business was that respect has nothing to do with a title or your last name. Respect begins with work ethic and personal ethic and a family member must earn the respect of other employees.

When a family member joins the business, they have to look at themselves not as owners of the company, but as employees who will be viewed and judged by other employees. Even when they own stock, they must hold themselves to a higher standard. Certainly some people will look up to the family members who are in the business, but they’re also looking at them as an example of the standards and the culture of the business. They have to set the bar high or they become a detriment to the organization. I hold my daughter to a higher expectation than I would any other employee, and my father did the same with me. That may not feel “fair,” and it isn’t always fun, but it’s part of the package.

Your Last Name Is Not a Free Ticket to Ride

I‘ve seen many family organizations where family members have an entitlement mindset. They believe that because their last name is the same as the owner’s they’re entitled to extra benefits — an extra week’s vacation, extra pay, or not being held accountable for providing value to the company that is commiserate with their compensation.

This is a trap you do not want to fall into as the employer or the employee in a family business. Entitlement breeds resentment, resentment breeds dysfunction, dysfunction leads to failure.

Your Last Name is Not a Guarantee

Lastly, when a family member is working in the company, whether it be for one year or 40 years like myself, they cannot be allowed to assume it is going to be a lifetime job. Business growth requires change. And it is always possible that the business will change models or locations or management and that any employee, including family members, will no longer be happy or be a fit within the new structure.

At any point in time the company may be sold and family members may or may not end up working for the new owner. For instance, I belonged to a CEO Group, called Vistage, which consisted of a few family-owned companies and one of the members was a young lady in her early 30’s, the third generation of family in the business. She was slated to become the next CEO within the next three years. However, her Father decided to sell the business for the benefit of his family and all the shareholders. When the decision was made to sell the business, this young lady felt somewhat betrayed. Despite her disappointment, she soon realized that she had developed skills and experiences within the family business that she could bring to another job or opportunity, whether it was for the profit or not-for-profit world. She also received a very good payout from the sale.

Companies, like all of us, have a life cycle. There is a time for them to begin and grow or be reorganized. But there is also a time for them to be passed on and that isn’t always to another member of the family. Regardless of their role in the business, a family business should never be viewed as a lifetime job for family members.

Family members who avoid the traps of assuming they’ll have respect, perks, and lifetime employment will be a lot happier working in the family business. And CEO’s who avoid letting family members fall into those traps will enjoy far more success as well.


The story of my father’s legacy and Paraco Gas will be published this year. To be part of the story as we near the launch of the book please follow us on Facebook or twitter.

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