Secrets of Success for first generation family businesses

Recently Galen Lehman took several weeks off from his job as president of Lehman’s. He spent this time visiting suppliers and other businesses he knew and admired. The companies he visited ranged from 1 employee to 300 employees. Most were owned by Amish or Mennonite families. At each stop, he asked, “What is the secret of your success?” This is one of a series of postings about what he learned

I just spent two weeks traveling across three states talking with nearly two dozen other family business owners and trying to learn everything I could about what makes family businesses succeed or fail. I was surprised to discover that every business shared common traits.

Family businesses succeed in the first generation because they are family businesses.

I doubt there is any other setting where a family would be so invested in a job that requires year after year of 60-hour and 70-hour work weeks. Family businesses in the first generation succeed because the business becomes a calling for every member of the family.

Work invades every pore of the family character. Work is suddenly an acceptable excuse for missing family events like Little League games and reunions. Work is discussed over the supper table (instead of legitimate family issues). And, work can be an acceptable excuse for requiring family members to work for little or no pay. Family businesses succeed in the first generation because every family member is willing to make huge sacrifices.

jay.jpgDuring this time, decisions are often made from the heart, not the head. Family members may be paid based on what they need (rather than what they are worth). Owners make decisions based on what they like to do, not what the business requires. This may not make good business sense. But, somehow, it all works!

I grew up in a such a setting. And, without exception, every single family business I met with did, too. The funny thing is, we all enjoyed it. We loved having a dad who was the “Iron Man”. We loved when he included us in his work. We reveled in the bond of shared sacrifice.

What’s your experience been with starting a family business?

Galen Lehman

About Galen Lehman

Lehman's CEO and son of founder Jay Lehman. Homesteads on five acres. Believes in a Simpler Life...rewarding relationships, fresh, local (preferably homegown) food and the gratification of hard work. Plant a tree!

2 thoughts on “Secrets of Success for first generation family businesses

  1. We had a family business for 12 yrs. We don’t have the longevity that Lehman’s has since we made the decision to not continue in that direction for a couple reasons. Our business was on the farm, first with market gardening and organic farming then a horse boarding business. Privacy became an issue because our business was also our home. Manual labor became an issue. :) We got tired of physically working so hard but to step up into hiring more employees meant higher production needs which meant needing to manage more people which meant less privacy and more hassles and not really more money. We’re not sorry that we did it for 12 years but we’re not sorry that we stopped either. Lots of life lessons on the farm and having your own business. Maybe if we choose one less physically demanding…

  2. Retail is definitely less physically demanding than farming. We have worked long, long hours at times, but standing behind a counter or stocking shelves is a far cry from throwing bales or shoveling manure.

    I also understand what you mean about privacy. I’m a very private person and I would not feel comfortable running a business that routinely required strangers to visit my home.

    Thanks for your post!