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Employing family members in the business can be either a blessing or a curse - both for the business and the family.
Recently Rupert Murdoch's biographer, Michael Wolff, claimed Peter Chemin, the COO of News Corporation had described Murdoch's three children, who have held senior positions within the News Corporation business, as "cretins". If this is true, he wouldn't be the first executive of a family business to think the owner's children had been promoted beyond their level of competence, simply because of their surname.
Indeed the old adage that the first generation make it, the second maintain it and the third lose it, reflects the ultimate price that family businesses too often pay for nepotism.
While no business owner would deliberately employ family members knowing they will eventually run down the business, many family businesses do have "providing careers for family members" as one of their acknowledged basic functions. When it's your own money at stake you can legitimately have objectives other than maximising profit and return on investment. (When you're playing with other people's money, non-commercial objectives are not so easy to justify.)
DOUBLE-EDGED SWORD
Being a member of a business-owning family and being employed in the business can be a...