The intrigues in managing a family business

It was back in 1982 that Wale Olaifa, then a musician, now a businessman, and his wife, Atinuke, first set eyes on Labamba Hotel in Oyo town, Oyo State. They fell in love with it, booked a holiday there right away and vowed to return each year with their family.

It’s a tradition that has continued for some years. Sadly, Atinuke died in 1999, but this month saw Olaifa finding an alternative there as usual, surrounded by no fewer than seven members of his extended family. As well as Olaifa and his sons, Matthew and Femi, there are five grandchildren, siblings and siblings-in-law, nieces and nephews and cousins, and even a great-grandson, John, aged one.

For Olaifa, now 68, it’s become a welcome opportunity to catch up with his clan. But the annual get-together is also a way of saying thank you for all the family had done over the years for his private owned firm, Olaifa and Sons.

The truth about Olaifa’s firm is that it has been an extraordinary example of family teamwork. Olaifa was always the brain behind the company’s operations, of course – but for the list of his clientele, for the authenticity of his services, and for the insights into the worlds of his customers, he invariably turned to his family for help.

For many years, Atinuke was his right-hand helper. “She was a terrific critic and a great researcher, she did all kinds of research for me and she was great at it,” says Olaifa. His sons helped him too, especially Femi, whose work as a commerce teacher was to assist in moulding new business models. “Dad came to my house one cold evening to seek for ideas for his new business plans,” says Femi, 42. “There can be nothing more nerve-wrecking!”

Femi is sitting next to his dad today at their country-home in Iseyin. The two reminisce on the family involvement in Olaifa’s business down the years. John says Femi was the inspiration for most of his father’s business success. Matthew, Femi’s son, provided much of the idea for the new business models of his grandfather’s business. And many others among the Olaifa’s family have been happy to weigh in with a bit of research here, or a business idea there. It’s almost been like a big family hobby that pulls them all together.

However, there have been snide comments about Femi being desperate to head his father’s company and whispers about him just wanting to cash in on his father’s legacy. “Even in the family, people say, ‘how does being a commerce teacher make you think you can lead a firm?’” says Femi. How does he deal with it? “By having good business plans and retaining my father’s clients and getting new ones,” he says.

Things that can go wrong in running a family business – my family and my husband’s family could clue you in on so many things, says Bunmi Akinde, a business owner. “My brothers, sister and father were in business together for many years. My husband is currently an owner in the family business his father started almost 50 years ago and is now being owned and operated by him and four of his brothers. My mother and I own a business together. Between all of these experiences, I have become very knowledgeable about the problems that can arise,” she says.

As a middle child, Bunmi has adopted the role of a mediator and peacekeeper, but when it comes to money and business that role becomes much more difficult for her. According to her, the siblings who are in business together develop many complex relationships that then spill over to every other family relationship. “Our family was once very close,” she explains, “we celebrated holidays together. We went on family vacations. We were very close to our nieces, nephews and in-laws. Over time, that has deteriorated because of business. My oldest brother still owns the business and our family tends to rotate in and out employment there, but the ties that were once there are gone. It makes me sad for my children because they will never know the family that we were before the family business.”

She adds that another problem that can arise with family business is that one’s personal life is no longer personal. “I’ll use my brother-in-law as an example. He has, throughout his life, battled alcohol and drug addiction. As any business owner knows, these are serious issues in the workplace. My husband learned that when you make a decision to terminate an employee because of these issues that is much easier than when you make the decision to terminate your brother. How do you get past something like that? It is a question that his brother will never understand. In his mind, because it is a family owned business, there should be forgiveness and repeated chances. To the other brothers it is a matter of risking everyone’s livelihood to help him and they are no longer willing to do that. Once again, family business has wrecked family relationships.”

Based on her experience with her mother as a business partner, one of the things Bunmi has learnt is to be realistic about expectations. “One benefit of family business is that you know who you are working with. You already know their strengths and weaknesses, so it can be positive if you assign your roles based on that,” she says.

Adeola Alarape, a counsellor, says birth order plays a significant role in the position and feelings of family owned businesses. The oldest child in families always turn out to be the ruler in most situations. “If you’ve done much reading about birth order and how it affects our personalities then you’ll understand how this can come into play in the operating of a business. I don’t want to say too many negative things, but suffice it to say that the God complex comes into play with many first born children and that can be difficult to deal with,” she says.

However, Gboyega Esan has another twist to this argument. To him, one can decide which problem to have in a family business, the one that will be generated right now, or the one that will be created in the future of a small company trying to be co-managed by three or four people, with the respective power struggle and the growth of internal bands among employees who are faithful to one or the other.

Another point he explains is that the evaluation generally begins with oneself, with each family member in particular. Then, one can ask each family member: “Do you feel qualified to work in the family business?”

“It is in these meetings that one discovers that many sons and daughters admit that their life project is not related to the family business,” he observes, “but rather that they are safeguarding their father’s dream, and that when their father dies, they will probably choose to do what they always wanted to do.”

Esan adds that if succession is presented as a competition, this never comes to light. “But, if you present it as a personal, intimate question, liberating the person from the obligation of continuing with the business role, for it was not he/she who made the decision but the father, it is very likely that at least one or two of the people competing for power will spontaneously separate themselves or accept minor roles because they do not feel this is for them.”