EP169: Pitfalls and Perils of Hiring Family and Friends with Brandi Marek

Should you hire someone based on relationships alone? Join us in today’s episode with Brandi Marek as we explore the importance of putting skill above relationships in businesses and the importance of being more scrutinous when hiring friends and family members. Tap on the play button now and take advantage of this insightful episode!

Key Takeaways To Listen For

• Essential questions to consider before getting into the family business
• Business-first family vs. family-first business: Which should you prioritize?
• How early education shapes an understanding of the family business
• Why it’s necessary to be extra thorough when hiring family and friends
• The importance of communication in leading a successful family business

Resources Mentioned In This Episode

• Thor
• Magic Johnson

About Brandi Marek
Brandi began her journey in the business management field as a business manager with a proven track record in the wholesale nursery sector. Her first-hand experience with the impact of having someone assist you in raising your business to a higher level has driven her to become a business advisor at Ferguson Alliance, with a certain focus on small- to medium-family-owned businesses. Her extensive experience in coaching managers and team members to achieve their utmost potential has reinforced her belief that individuals naturally aspire to excel and contribute value to their organization.

Connect with Brandi
LinkedIn: Brandi Marek

Connect With Us
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Transcript

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[00:00:00] Dr. Nate Salah
One of the greatest challenges in leadership for a small business owner is whether or not they should hire a family member, a friend, this is going to come up at some point. It is likely to be inevitable. It's happened to me. It was probably happened to you. Then what do we do? We figure out, Oh, well, maybe we just need to bring them on and they need help. Well, it can be a total train wreck, a total disaster because we're looking at the wrong reasons why we bring someone on who we know and care about. Well, I've been. I did an expert in this area, Brandy Merrick, to talk with us about the true nature of what happens and what pitfalls happen when we hire friends and family. What to look out for, how to navigate this important space. I can't wait for you to listen in. I'm Dr. Nate Salah, and this is A Call to Leadership. Brandy, welcome to the show. 

[00:00:55] Brandi Marek
Hi, thank you so much for having me. It's great to be here. 

[00:00:58] Dr. Nate Salah
Absolutely. Our listener perhaps will have tons of benefit from this episode, particularly around families and business. When you own a business, inevitably, you're going to have to have the conversation around family or friends or different individuals who you will be Thank you. Tempted and bombarded perhaps even with joining your worthy enterprise, right? Actually happened to me when I was probably about seven, eight years ago. And my son, he was like nine and he said, dad, when old enough, I need to take over the family business. So, oh, do you? Yeah, I need to take it over because it's important to keep the name alive. Like, what do you mean by keeping the name alive? Cause you know, it's a solid financial corporation. If you sell the business, they won't keep the name.

[00:01:44]
Like son, that is like the wrong reason you want to take it over. And it's an interesting conversation because we often perhaps have great motives for wanting our family to be a part of our business or people we care about. But perhaps even though the motives are great, maybe it's just not the right move. Maybe there's lots of unknowns and roadblocks. And let's start to unpack that a little bit. I mean, in your experience with your expertise, how do you respond to a question like that? Maybe it's not A nine year old. Maybe it's a 39. 

[00:02:19] Brandi Marek
Right. Yeah. And you know, I'd say we see that fairly often in our practice, especially with the second and third generations where good, bad, or indifferent, there is some sense of obligation there from that next generation to take over the business, maintain that legacy, keep that vision alive. We experienced that a lot. And so oftentimes. We want to suss out, first of all, what are your personal passions and desires, right? What kinds of things do you gravitate towards? What kinds of things do you find fulfilling, right? And then balancing that around, does the business play into that? What kind of purpose? Do you see in your life? And how do you see the business supporting that or maybe not supporting that? And what does that look like? And so starting from there first and recognizing that whatever you personally desire is oftentimes not going to be able to be fulfilled. Stymied in a way over time, right?

[00:03:30]
I think a lot of times we think, oh, we'll get over it or it'll change or maybe our minds will change and we'll want to get reinvigorated about this, but really being honest with yourself and asking yourself those questions first and making sure your intentionality around wanting to continue in the family business or be in the family business. Is out of passion, purpose, fulfillment, and not rooted in obligation or guilt, which we find fairly often there is some obligation and guilt. And that's not to say that that can't go away and that you find your purpose and your passion within it is just making sure that you're asking yourself the right questions first and that you're being honest with yourself around what that looks like.

[00:04:20]
And as the kind of the first generation or the generation that's stepping back, also making sure that the mindset there is that you're not. Communicating either verbally or non verbally that that obligation is expected right that you're making sure that you're very open to understanding that maybe the business was originally your dream. And just because it was your dream doesn't inherently make it others in your family's dream as well. And so being open and okay with them saying, You know what, it's just not for me and I would like to explore other things. 

[00:05:03] Dr. Nate Salah
And so having that in balance, that's so good. Yeah, that's so good. And making that distinction, I have a colleague who his father wanted him to take over the family business and it was very emotionally difficult for him because it wasn't his dream as the son and he didn't want to let dad down, but he did feel that pressure. To take over the business and eventually he ended up going in his own direction, but sometimes we can impute our own dream on our next generation to take over the mantle. And so even for me and my son, I said, you do you, you follow your genius. And it may not even be in business. You may be in politics or you may be in medical or you may be the head janitorial. Custodian at a school, whatever you do, just do with all of your strength in your genius and in your passion and your purpose. You're never going to let me down by just giving your best in the area where you're called to be your best. It may not be in my business. I think that takes off a lot of the pressure.

[00:06:09] Brandi Marek
Yes. A ton of the pressure. Yes. Yeah. Most of our, when we embark on an engagement with a family, first of all, we feel mostly in family-owned business, privately owned businesses. And so we are, the beginning is a lot more, usually a lot more personal and psychological in a sense of really kind of figuring out where everyone's been, where they want to go, what that looks like. And so part of that is also. Really coming to terms with these types of conversations and it can be very challenging for people to have because yeah, as a parent, you have this vision, right? Part of your vision is that it carries on and so it can be very difficult to let go of that and be open to whatever's next.

[00:07:04] Dr. Nate Salah
Yeah, yeah, I tend to consider, you know, business is not a monarchy. It's not like the next king or prince or queen is going to take succession. I remember, it reminds me if anyone listening is familiar with the Marvel movies, the Thor movie. Uh huh. And in the very first, you know, movie, the father is bequeathing his throne to the son and actually wasn't even ready. Right. And it was a huge train wreck. I didn't, you know, no spoiler alert, but it's been around for a little bit. And I think about that. I was like, I don't want that to be the life that I have for the business that I haven't even, I haven't even told my son. When he's old enough, if he wants to work with me, he's going to start just like everyone else.

[00:07:43]
He'll start at the place where he will develop his skills and those skills will determine and his impact and his ability will determine his place in the organization. And I think that's important also for not only your family members, because that might be like, okay, fine, I'm out. Maybe I thought I was going to get special treatment because I was your family member and maybe that's a non negotiable for them, which is fine. In some ways, someone listening is like, we'll push back and say, well, no, they should get special treatment. And I'd like to hear your perspective on this, because it doesn't just affect you, it affects the entire organization. Totally. What message does that send? 

[00:08:22] Brandi Marek
Oh, well, it sends a lot of different messages. So, first of all. One of the things we often do when we start out is really discuss the business of the discuss the difference between a business first family in a family first business. And so your business first family is no matter what kind of personal dynamics you have going on. Is going to put the interest of the business first, you're going to always be operating with the best interest of the business. Now the family first business is going to take the more perspective of it. It is more important that there be this kind of lineage, right? That maybe this is more of a lifestyle business where the business is providing a lifestyle for the family and that's where the emphasis and then priority is put. Obviously you can choose which path you want to take, but it's all about being true to whatever that path is. And so oftentimes we find like, yeah, we want to be a business first family, but they're really living in that family first state. Right. And that can be extremely challenging for your non family member employees in your operation.

[00:09:30]
And so we really like to encourage, I think you're really on the right path where you were. You make it skill based, right, kind of recognizing that you're not doing anyone any favors by not having some standards for the same standards for your family members as you do for your non family members, right? You want to hire the most qualified person. And so it's also understanding that if you are not the most qualified person as a family member yet, that not to take that as a dig, but to Kind of recognize what can you learn from others coming in? And so I myself and my husband worked in his family business and I can't tell you, I mean now having stepped out of that business, I had always heard of family businesses where they required that when you graduated college that you go work for another organization for at least five years or some amount of time, right? And I thought, well, that's kind of odd, but I totally see the relevance of that now. Just having worked strictly inside the family organization for 15 years and then stepping outside of that and going out into a different world. I so wish, oh my gosh, if that five-year rule would have stood, you know, I just wonder all the things, right?

[00:10:53]
What would life be like now? And honestly, I kind of hit a learning curve coming outside of the family business, just around general communication practices and how to navigate decisions being made, right? When you can text or call up or see the decision maker often, you kind of lose sight of. The time that that takes, right? And so really putting that into perspective and compartmentalizing that as much as possible can be very, very valuable for the family and the business. And I think it's often something that's very overlooked. And from a family perspective can feel negative, but in the long run can be such a positive in navigating that.

[00:11:44] Dr. Nate Salah
Yeah. And the work you do is so important in that respect because, you know, we're talking about leadership and leadership involves discovery. And before influence and achievement. And so this is a discovery phase, I think, in a lot of ways for the business owner and in terms of what the succession planning might look like, you say, well, a listener says, look, I'm in my late forties or I'm in my early fifties. I've got some runway before I'm ready. Maybe my kids are still, you know, I've got some preteens and some teenage kids, however, I don't know. You tell me, I don't know that it's ever too early. 

[00:12:17] Brandi Marek
To start having these conversations. I agree. And I'll say another thing that I feel like a big differentiation that's important to know is that oftentimes the first generation had the passion to start the business first of all, right? And so that's one difference to acknowledge that they had this passion to start this business. They were on the ground floor. They were likely the person. Maybe they were the only employee at first, right? So they were doing sales and bookkeeping and depending on what the business is, you know, manufacturing or service orientation. So they were doing it all right. And you learn everything from that. And you, you know, Feel that stress of how am I going to make payroll? You know, you, there's a lot of more hardships that are encountered. Whereas myself and my husband entering into the business, it was sustained, right? It was profitable.

[00:13:09]
So we didn't have kind of those challenges to work through. It was a totally different thing. So, so yes, the earlier the better to create some exposure. Around that and create some awareness that that it's not always easy and you have to make some tough decisions from time to time and also and just allow them to see like, is this something that you want to do? Is this something that you would be interested in because you want them, maybe they're not going to have the same passion that you had when you started the business, but you want them to be passionate. And so what is it about the business that gives them that passion and having them expand on that? Leading them with that, right? Because maybe they are going to go off to college and maybe, maybe your business requires a more specific degree, right? So before they're making that commitment, you want to make sure that they. Are aware of what they're doing, what they want, and again, giving them permission to explore that agreed.

[00:14:21] Dr. Nate Salah
Yeah. And even as you're speaking, I'm thinking of clients I've had, and even in our own business, I've had a number of, of nieces and family members. And like I said, my son said, Hey, dad, you have something for me. And our business is advisory and accounting and tax. So when you're young, the skill sets aren't quite developed for that type of high technical level of expertise and work. My response is, well, let's find you something that develops certain levels of skills, soft skills that will compliment that ability in the event that there is something open later, or you develop a certain level of talent or ability to move into. A space with us. So I encourage me for soft skills, go work at a Chick fil A, right? Get the customer service experience when you're young. Those skills are invaluable, uh, later in the marketplace. And so I encourage young people, even when they're working, when they're considering, they want to work in the family business, as you stated, right? Start someplace where you can develop those general skills that may be useful later.

[00:15:28] Brandi Marek
And not only that, develop that, that empathy almost, or that connection to what it's like to be an employee. In an organization, right? That's good to not be the one that can be that there is a layer of security there as a family member in a family business where it's like, well, it is a little more challenging if you'd like for me to go away. Um, so understanding the flip side of that, I like how it feels to just be an employee in an organization. Is huge and can be tremendously helpful. 

[00:16:01] Dr. Nate Salah
So the, let's talk a little bit about pitfalls. It's been said by some, don't even hire your friends and family. If you have a legacy business and your family, if you're doing good, business is just doing fantastic. And you're, you're floating along, maybe help your family to find another route, another path, so they don't train wreck your business. What do you say to that? Or what have you seen? 

[00:16:24] Brandi Marek
I have lived it and seen it. Both directions, either through family members or friends, right? Oftentimes, if we have a gap in our organization, or we're just talking about what our organization wants to do next, right, oftentimes, as people, it's a, the human condition, right? We want to be helpful. So they'll say, Oh, well, so and so is really good at that. He would be great. Like, you should add him to your team. Or. Oh, that sounds exciting. I would love to do that. I'd love to give that a shot. Right. And so we often go the path of least resistance and we think, well, I know this person that feels safe, right? That's oftentimes how we get ourselves in that place. Going back to the business first family mindset is really being very thoughtful in your approach, right? Not to say that you shouldn't hire friends and family, but you should be very scrutinous. Probably more than you would with just a general. Higher of someone that you didn't know because it is going to be more complicated.

[00:17:35]
It is going to be more work. And so it's making sure that you're up for the challenge. You're gonna have to communicate more and you're going to have to say, hey, we need to have a difficult conversation. And we've got to move forward in this way, right? And so I just say, are you prepared for that? Are you prepared for your personal dynamics to change? Because it's inevitable, right? They are likely going to change. There are going to be some things that you maybe can't talk about with that person anymore, or maybe you would have in the past, things like that. So being prepared for your relationship dynamics to change. Having to hold that person accountable in a way that you haven't before can be a big pitfall. And if you're not prepared to do that, then that likely means that you're going to start allowing some behavior that you likely wouldn't allow if that person wasn't your friend or family member. And then we get into the impact that means for the non family member, non friend employees in your business can be very detrimental.

[00:18:46]
So I often suggest that you have those types of tough conversations in the beginning before anything comes up, you say, look, I need to make sure that you understand that if something's going on, I'm going to have to hold you. To it. I'm going to have to hold you accountable to that. And I've got the same expectations for you that I would anyone else. And actually, they might even be more harsh. Because I want to be very sensitive that there's no nepotism or favoritism that's seen here. By you working here and if you can't have that conversation when you don't have a problem, then that's likely going to be a good indication that you should not make that higher.

[00:19:31] Dr. Nate Salah
That's good. Yeah, the crucial conversations and you're so right. I mean, that was just spot on. As you're sharing all that, I'm having all these memories, right? I've been in business for almost 30 years, so you can imagine, right? These conversations have come up again and again in my own journey with, Oh, this person's kind of having a tough time right now, and you might have a need for this role, and perhaps, like, well, I don't really need anyone, but maybe I can make the role, find something to help someone, like all, these are all the wrong reasons. They're great intentions, but you can see as you're sharing, because what's happening is, Is that you are making, as you said, the expectations are different, you're making concessions to help one individual and there's nothing wrong with helping people, but sometimes it could be at the cost of organizational health and at the cost of the mission, because, you know, every organization has a mission, whether it's stated or unstated, and I've come to believe over the years that the mission is more important than any one individual, including myself as the owner.

[00:20:32]
And so what does that mean? It means that we elevate them. It doesn't mean that we forget about people. It's just that means that we are focused on upholding the values of the organization as barriers and boundaries for expectations that lead us to our end state, which is really what our promises. And if we compromise that promise for any one person, based on all those factors that you just mentioned, we're doing a disservice and leadership and with the experience that we create. And so I can tell story of certain fact, I hired my mom years ago, and I don't know if anyone listening has ever hired a parent, but it's different when you hire your mom. Right? And so. When you go around the office and your people are like, Oh, you know, that's Nate's mom. And maybe they're a little nicer to her. She makes a mistake and, Oh, that's okay. We'll fix it. They might not even tell me because, Oh, they don't want Nate to get upset with his mom. I mean, look, there's too much energy being expended and not really owning your role. I'm not saying that's the case. Eventually I had to let my mom go. I said, mom, I got to terminate your employment.

[00:21:38]
I think I still kept her on the Nate payroll for the rest of my life because that's what you do with mom. You need to, you know, take care of mom. However, we were downsizing at the time and it was the right thing to do. But even that was a difficult conversation because your family member might take it more personally. Then an employee, and I love the way you put it is make sure that not only that you very clear in the beginning, but also sometimes that bar has to be set a little higher. And if you can't have the conversation that, you know, okay, well, this is something that's going to be a challenge for you along the way. And that perhaps it's a family, perhaps it's a friend. I think that, uh, oh, it was a basketball player. It'll come to me, uh, who was sharing about his philosophy on his name economy. On business and he was a Lakers basketball player, a boy, you know, these senior moments you have. Right? So Magic Johnson, Magic Johnson was sharing and he said, do not just don't even go there. Don't hire your family. Don't hire your friends. Hire the best person for the role period. Don't even think about all that. Look, here's the role. You can apply just like everyone else. You can go through all of the interviews with all the people on the way. And if you're the best candidate for the role, there's no favoritism. You just get that role. 

[00:22:52] Brandi Marek
Yeah. That's where my default lies, honestly, just because it's so challenging. And a lot of people, either the business owner or the person, the family member or friend getting hired, just can't handle it, honestly. It is expending too much energy on something that just shouldn't be that hard. Honestly, it just shouldn't be that hard. And so it's oftentimes because we care so much, we're so protective of the relationship from a personal standpoint, and we don't want to impact that. And that's just really hard to do in a business setting sometimes. 

[00:23:33] Dr. Nate Salah
And family drama too. Oh, there's many stories, especially when it's a siblings that are part. And I can tell many stories about that from a business perspective was a direct client and then also in big business. 

[00:23:45] Brandi Marek
Honestly, if you've already got drama, it's a no-go. I hate to say that it's impossible, but it's almost impossible because you need to have the trust. You need to have the communication skills in. If you've got drama already, chances are you don't have trust and you don't have good communication skills. So, you are setting yourself up to fail. And so, prevent that as much as possible. And, always, always, always, in everything that you can possibly do, try to maintain The personal relationship that is what is most important and so most people can go get a job anywhere it doesn't have to be in their family business or with their friend and so if you are fully not prepared to put the work in or you know that you already have some sore spot. Work on your personal relationship and keep it separate.

[00:24:44] Dr. Nate Salah
Yeah, that's gold. It may sound rudimentary in some ways, but it needs to be said. It needs to be verbalized so that people. Can feel comfortable in that space vision has to match. I actually had one of my clients who I was so proud of this client because they had a business that was growing rapidly with a, with a, a family member and the visions weren't exactly aligned on the direction they both walked in such great maturity. I was so delighted to hear that there was an amicable way to move in a different direction. And that's okay too, right? Because it's better to have those conversations early, have them early, have them with people who, uh, who are your mentors, your coaches, you know, of course, you know, the kind of work that you do and we'll share that in the show notes.

[00:25:32]
That, that give people opportunity to have objective, uh, clarity that's beyond the emotional aspect of, Oh, well, I need to do this because of this, this, and this, because the family, you want to eliminate that sometimes it's great. It works. There's succession planning and businesses. Of course, you know, you think like the Ford company over the years and other organizations who have maintained. At least on some level, of course, there's every so often there's a second or third generation, maybe a fourth, that there's a hiccup nonetheless. Everything you're saying is it makes sense, right? Do the due diligence, do the initial planning up front, have those difficult conversations, realize or recognize that this may be a much more difficult situation, prepare them young for their journey, whether or not it's with you. All of those are great, great tools for developing this. Business as a family.

[00:26:27] Brandi Marek
It is quite the business and touching back on your point around alignment, around vision, that's probably one of the top reasons to people will reach out to us is just there is some misalignment there and they feel stuck, right? They know that maybe the business. Has been wildly successful in the past for these reasons, but maybe there's market changes or maybe there's just kind of motivational changes within the business or within the ownership or. A total disconnect around where they should go next. And so we see that very often. It's very common that organizations want some help around that. 

[00:27:08] Dr. Nate Salah
Yeah. I'm glad that you're in the trenches in this very important. He's helping business owners, leaders navigate what can be considered very treacherous waters, especially as their business is growing and they're seeking have and wellness and a sense of continuity. Yeah. You know, businesses as they grow. 

[00:27:29] Brandi Marek
A very lonely space to be in for a lot of business owners, especially, you know, if they don't have a lot of friends around them or family members that can relate to what it's like to own a business and some of those challenges that can often feel very isolated. And so we like to recognize that as well with our clients and give them the acknowledgement of. We, we see and understand. So all of the advisors in our organization either have to have come from being a family member in a family owned business or in an executive position in a family owned business. So to have that direct experience with. What it's really like because it is so challenging at times and so being able to have that relatability 

[00:28:18] Dr. Nate Salah
Yeah, absolutely. Well, we need you in the world. We need your team and thanks for being here.

[00:28:21] Brandi Marek
Thanks for having me This was great. 

[00:28:25] Dr. Nate Salah
Well, my friend I am so thrilled that you joined me on this episode of A Call to Leadership and before you go to the next episode. Especially if you're binge listening take a moment I would love to get your honest review right here on your screen your feed Feedback is so important. It helps the podcast. It encourages me and it helps me. It helps me to give you more and more and more value. So I can't wait to read your review. I can't wait to be with you on the next episode. I'm Dr. Nate Salah. This is A Call to Leadership.