A “Legacy” Business

“People who build family businesses are not classically trained. They have to deal with an enormous amount of politics. You think corporate politics are tough? Go work for your dad or your mom.”     Gary Vaynerchuk

Working in a family business has its privileges but it also has pitfalls. Most people might think if a family owns a company it’s easier because, after all, you only have to answer to each other. Ultimately, blood is thicker than water and no matter what things will eventually work out. While this is true to a certain extent people don’t realize the stress and toll running a family business can take on the relationship of all those involved.

Let’s first discuss the obvious and not so obvious benefits of working in a family-built empire. The first benefit of working in a family business is the privilege of being an owner. As anyone that’s worked for another company knows, employees are expendable while ownership comes with the benefit of never being asked to leave. Of course there are exceptions to this rule such as when a person abuses drugs, steals from the pot, abuses employees…etc However for the most part even under conditions such as this if you are a family member and part owner, things can be forgiven sometimes and/ or overlooked. That would never happen for a typical employee.

Besides ownership the second privilege of working in a family business is the ability to establish a legacy brand. Our family business, Zankou Chicken, has been around for over 50 years. The first restaurant opened in Beirut, Lebanon in 1962. Our group is the 3rd generation that is running this chain which is now located in Los Angeles, CA. We now have 8 locations with a bright future, but it wasn’t always that way. We’ve had our ups and downs, which was featured in an article by Mark Arax for Los Angeles Magazine. But we are far from where we need to be if we ever want to establish this business as a legacy business. A legacy business doesn’t have 8 restaurants. It has 800. And besides the money, fame, and fortune that comes with having established a legacy business (and 800 x the headache), you also have to have it be firmly established in terms of the principles and values it stands for. Future generations can’t just easily untangle or otherwise ruin a legacy business. Everything a legacy business does has to agree with the established mission statement and values statement

 

Origin

late Middle English (also denoting the function or office of a deputy, especially a papal legate): from Old French legacie, from medieval Latin legatia ‘legateship’, from legatus ‘person delegated’ (see legate).

 

It’s funny because this word comes from the Latin word for “person delegated”. And in a legacy who do we represent? We represent our family, the hard work that they brought to the United States, and everything the brand represents.  When the word legacy is being mentioned as a noun, it means money or property that is left behind to you from the previous generation; which is often a good thing, a blessing.  But when it is being used as an adjective it means something that is old and antiquated , “demode”. So as you can see having this legacy business is both a blessing and a curse. A blessing in that to truly be called a “Legacy” business we have to take it from 8 stores to 800 stores in our lifetime, and not only that but we must make sure we constantly keep it new, fresh, and modern. It must both keep all the old world class, culture, and ancient ways of making food that has been passed down now from generation to generation while still making use of new technologies, new methods of delivery, and new styles in terms of marketing and advertising the brand. 

The legacy aspect is very important and extremely powerful in terms of marketing. What is the worth of a company that has been around for over 55 years? For one thing it humbles all of us, as well it should. We take pride in working for such a powerful brand, realizing that this name and the quality associated with it has been around before we were born. It will likely still be around long after we are gone. This gives us a powerful sense of doing the best we possibly can for this brand. For me personally it’s almost like a competition between generations. How far can we push this brand before the next generation is handed the reigns? How far can we improve customer service? Can we make the food taste better and better while maintaining the high value customers have comes to expect for decades? How many locations can we open? Can we spread to another state like Nevada and open a location in Las Vegas like customers have been asking for? Dare we say we have the privilege of being the generation that takes the Zankou Chicken brand global and open locations in the UK and France like our father had dreamed of doing?

So you see this is a huge benefit because we didn’t have to start from scratch as some businesses do. The third benefit of working in a long-running family business is that, to a certain extent, the family is forced to always be around each other. This is one way we are always working together, always seeing each other more than typical adult brothers and sisters. So in one sense it is a glue that binds people. A family that runs a business together has no choice but to be cordial and good with each other because, ultimately, a falling out eventually affects the performance of the business itself. So no matter what happens, no matter how bad the fight or what insults are said, you have to make up and keep working together as a unit.

Which brings me to the weaknesses and defects of running a family business. And just like my last point about a family business being the glue that binds people, it causes unnecessary friction and turmoil in a family. Most families that are adults see each other maybe once a week or twice a month. Families with children probably see each other a bit more often. But when the family interaction is forced by workplace stress and business related matters at least once a week and in some businesses, every single day, this can take a toll on relationships. Imagine seeing your brother or sister, wife or husband every single day, and when you see them you’re almost always talking about meat quality, service related matters, marketing and sales, legal and/or moral issues that need to be debated and worked out, human resource problems, maintenance matters…etc. The list goes on and on. You are never out on a family adventure; fishing, hiking, or doing anything remotely fun that has nothing to do with work. And when you do something fun like go out or even just get a table at a club, it seems unnatural. We feel guilty because we are around each other and we’re not at work.

I don’t know how others feel, but I can tell you from personal experience that it’s very hard to deal with. It’s difficult to perform so well at work all the time and keep the family relationships at a healthy balance. The second difficult thing about working in a family-owned business is what I would call” Lack of professionalism.” This is where a family has been working together for so long that people don’t dress up for work at all, walking in meetings with shorts. I am as guilty of this as anyone else, so this year, 2014, I am making a change. I will choose to always dress professional on the days I show up at work or for meetings. It sets a positive and professional tone for everyone.

When people argue or fight in a family business things can get out of hand very easily. You do not see the person in front of you as an account executive or marketing professional. You just see them as your husband, your wife, your brother, your dad or mom or sister or cousin. This makes it easily to verbally abuse people when you completely disagree with their point of view, or when your project ideas get rejected. You tend to take them personally. There is no way professional people working at a corporation can act like this. They would get fired immediately. Yet us in family businesses do it all the time, taking for granted that these people we work with are just like us and that they too, want what is best for the brand and the company. It’s so easy to lose sight of that in a family business.

Which brings me to my third and last point. Working in a family business is extremely difficult because everyone tends to be more emotional. This emotional attachment to the brand permeates everything we do. A family business is much less likely to close down a poorly performing store, get rid of a product that is not selling well, or to fire employees that are not up to par with expectations of what stellar employees should do. Everything seems to be an emotional decision. If a professional corporation like Starbucks for example decides to close down a 1,000 stores and then build 3,000 new stores in other areas the following years, they can do this by vote of the board of directors. In a family business the board of directors are the family members themselves, and we would often be shot in the foot then close down one of our beloved stores.

So as you can see running a family business has its ups and downs. Are we blessed to be given this opportunity to push this brand and open stores all across America? Absolutely we are. Should we ever take it for granted? Hell no we should not, we should be very grateful. However people need to realize just because they see long lines we are not printing money. Our overhead costs are extremely high in this business and our profit margins are very low, especially in light of recent skyrocketing beef and chicken prices. It’s hard but we love to do it because we care about the brand and we love our customers.

It is difficult to help run and maintain a family business with over 400 employees, and growing, and at the same time foster the creative spirit. Endless arguments can definitely damper or kill creativity, but we need to learn to choose our battles. You have to ask yourself, is this really worth all my time and energy? Am I the only one benefiting from this project? How does my project reflect the actual profit and loss statement of our company?

Asking these tough questions for yourself and asking the toughest, rigorous criteria for each and every project to tackle will make your job and time worthwhile and meaningful, both to yourself and to the family business. Not everything is worth fighting for. You have to just learn to breathe, step back, and realize that often not doing anything is easier than fighting and quarreling about stuff that a few years from now will seem meaningless. Focus on the big picture, and ultimately in the big picture, loving your family and positive teamwork will always trump your small ideas. You will not always win, and this is the way it is in a family business. And that’s OK.

“What I have found is that, in a family business structure, sometimes what is needed is a sense of discipline rather than creativity. You have to take everyone’s ideas and make it work. When you are dealing with money, there is a limitation on how creative you can be. ” Ashwin Sanghi

 

Citations/ Resources

http://www.oxforddictionaries.com/us/definition/american_english/legacy

http://www.yourdictionary.com/legacy

 

 

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