Dear Aunty B,
My brother started a business just over one year ago, and had absolutely no idea what he was doing (he’s a technician and left his job to start his own business). In the 12 months he ran his business, it was in debt over $30,000, he didn’t pay PAYG, super, GST or anything.
So our father bailed him out financially, and asked me to sort out all the legal and ATO problems – which I did.
My father then asked me to do a full business analysis to see if the business actually had a chance if it was run properly. After one month of researching the business, the industry, customers, competitors, etc, I determined the business had a great opportunity. So, our father decided to set up a company, appoint myself effectively as the Managing Director, himself as the CEO, and my brother to look after the technical side including quotations to customers, and manufacturing, installation, etc.
We’ve been running for three months now, and the business is absolutely booming – I have put heaps of systems in place – sales, lead generation, purchasing, suppliers – everything is under control now… except my brother.
He is a loose cannon, has no attention to detail, doesn’t show up to customer appointments (and doesn’t even call to say he can’t make it), takes wrong measurements, doesn’t manufacture to his own specifications and has to redo jobs, etc, etc. When pressed about not showing up to customer appointments he blatantly lies about why he didn’t attend.
I’ve put more and more systems in place to automate things, and negate any impact he has on the business (minimising the effects of his stuff ups) but the more he stuffs up, the more I take over his job functions and he has less and less to do – now I am flat out doing everything.
I told my father, the CEO, if he was an employee he would be sacked a long time ago. Problem is, he’s my brother, and owns a third of the business.
What in the world do I do?
Frustrated but caring sibling!
Dear Frustrated but caring sibling,
Well good for you. So you’re the good sibling. The one that set the table, got the As at school and watched daggy telly shows with your parents. And he’s the naughty one who wagged school, drove your parents nuts and rubbed your face in the sandpit.
Because the first thing you must realise is that while you think you have set up a professional company, the situation is really a replica of your family life with everyone faithfully playing their part. Your brother is being a pain in the neck waiting for your dad to bail him out while you whine on the sidelines, playing goody two shoes.
You have to break free of this family drama to which you are all addicted and see this business as a separate entity to your family.
In the short-term I would sack yourself. Make your father chairman, you either leave the company or take on the role of director and hire a general manager/CEO to whom your brother can report.
Set up a family council and work through your problems outside the business. This should help explain to your brother that yes, he is the founder and yes he has a third of the business. But this is completely different to his role as an employee for which is held accountable like any other member of staff.
Explain that the new CEO/GM has full authority to performance manage him – out of the company if necessary, although he will still have his shareholding. If he has to be sacked, offer him some extra shares or money as founder which may help soothe feelings and again help him understand that he is being rewarded for starting the business but there is a lot more work needed to be done to make a business successful.
Of course, none of this will happen because you won’t be able to extricate yourself from this family drama and your softie father won’t let you sack your brother.
So you must resign immediately and go off and start another business. Sorry to be so gloomy but as I often say in this column business and family rarely mix.
Good luck!
Your Aunty B
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