I was hired into a company as a Project Manager and was asked to be an account manager over this small business. I have had a hard time getting the owner of the company to set policies and procedures in place. Therefore, it has been hard to manage a team without rules. The standard here was and still is come and go as you please. The owner has a sister who works in the company who feels that she can say and do as she pleases. This person has been disrespectful with me even, in the presence of the owner, with no discipline. What do I do?

Answer:

You’ve heard about the Golden Rule. You may also have heard, “When you have all the gold, you can make all the rules.” Your ability to manage this situation depends on the owner’s understanding of the problem; his management savvy and his willingness to back up any policies that are established.

A small business usually lacks formal rules and policies. The owner makes them up on a case by case basis. Sometimes the owner will cut special deals with employees about pay, working arrangement and benefits. It seems harmless at first but usually creates trouble as the business grows. Employees begin to spot inequities in treatment and may complain about things not being “fair.”

Once the number of employees reaches fifty, laws and regulations come into play that dictate some policies. But long before the fiftieth employee is hired, businesses usually realize they must put some rules into affect or risk turnover and dysfunction.

If there are family members working for the owner, it adds another layer of complexity. As in the case of the owner’s sister, family members have been given (or simply just take) special “family privileges.” Even if the family members have the same jobs as other employees, they may have more flexible work hours, higher pay and more influence in running the business.

I have seen some very wise business owners, who have established clear expectations for family members and expect them to set an example and follow the rules like everyone else. But frankly, most don’t. Whether it seems fair or not, it is often reality in a family business…the rest of the employees will probably never be given the same perks the family members receive.

I recommend that you have a discussion with the owner, to determine what his standards and expectations are regarding consistent policies. Ask him how he would like you to manage his sister’s performance and work habits.

If he doesn’t want to commit to any rules, you may have to explain how the lack of rules is actually destroying the “family feeling” and morale. Take time to explain why you want to establish some consistency—don’t assume he has a clear perspective about how rules create a level playing field. If he has never worked for someone else he may be underestimating the importance of consistent rules.

To prepare for the discussion, document some of the situations that arise and the conflicts and ill will that occur because there is no consistency. If he doesn’t want policies, because he feels it is going to cause more bureaucracy, reassure him that you will keep policies to a minimum (since they must be enforced to be effective) and that you will discuss all guidelines with him prior to implementation.

But go into this discussion with your eyes open; if he is resistant to your suggestions, it may result in more friction between you and the family members and I predict you will lose the fight.

An owner of a family business makes a decision—whether it’s conscious or not—about the roles and rules family members will play in the business. By not stepping in when his sister was disrespectful, the owner of your business demonstrated what his standards and expectations are. It appears that he is not willing to step in and challenge his sister and support you. Even though he told you to manage the employees, he probably doesn’t want to risk disharmony in the family.

In the end, you will need to decide if you are able to live with his standards. If it’s not a fit, start looking for a new job…in a bigger company that isn’t family owned.

(Joan Lloyd provides small group, presentation skills workshops and one-on-one coaching, How to Present Like a Pro. )