Successful Entrepreneurs Understand the Value of Family

Successful Entrepreneurs Understand the Value of Family

It is hard not to underestimate the role that family can play in successfully running a small business.

That point has been brought home by the COVID-19 pandemic, which has led entrepreneurs and their families to share the same physical space. A new study has revealed that that increase in quality time may have many unforeseen benefits.

Research from the University of Georgia, which was published in the Journal of Applied Psychology, has found that positive interactions with your child during your off hours can make you a better leader. This especially hit home with me as I have a young boy.

Specifically, the study examined two samples of 46 and 113 managers, measuring whether participants had experienced positive interactions with their families, such as working together on a project or laughing together, each day after work.  Among the other factors examined was whether participants felt connected to their family and satisfied with their family life in general.

The researchers also analyzed leadership practices, asking participants how often they engaged in behaviors such as making sure employees know expectations and helping subordinates strengthen their skillsets. In both studies, the managers completed one survey in the morning and one in the afternoon for 10 days. The results showed links between positive family interactions after hours as well as more effective leadership during the workday.

Szu Han “Joanna” Lin, the lead author of the study and an assistant professor in the University of Georgia’s Terry College of Business, had some interesting thoughts on this.

“We focus so much on the negative things about work-family balance or the demands of a family—people need to meet these family demands, so that’s why sometimes they couldn’t perform well at work,” she said. “But one thing that is important to know is that leaders could be more effective because of their family life.”

Plenty of scholarly research on leadership focuses on how family life can negatively impact a person’s career. Studies that do examine positive effects of family life typically focus exclusively on task performance. Lin wanted to examine how positive interactions with family could specifically influence leadership behaviors like showing consideration, marked by things like helping and showing concern for employees, and more change-oriented behaviors such as helping employees develop their strengths and showing enthusiasm about what needs to be accomplished on a specific workday.

Transformational leadership, which focuses on creating a vision and how teams can work together to achieve it, is considered one of the most effective styles of leadership, Lin said. Through her research, Lin found a connection between showing more of those transformational tendencies and having had a positive family interaction as a parent the day before.

And the positive interactions do not have to be something big. Little moments can lead to big changes in attitude the following workday.

“You take your kids out for a walk. You chat about how your day was. These are positive family events that help you feel you connected with your kids,” Lin said. “Your needs are satisfied at home. And on the next day, you’ll be more motivated to help your employees.”

Why Entrepreneurs Should Embrace the Value of Meaningless Chit-Chat Among Their Employees

Why Entrepreneurs Should Embrace the Value of Meaningless Chit-Chat Among Their Employees

Successful entrepreneurs have a secret: They know how to get the most out of their employees.

Through my two decades as an entrepreneur, I learned this with my own businesses, as well as watching other successful small business operators and how they inspired their employees.

I have a playbook for this, comprised of tactics and approaches that have worked. But instead, I want to talk about a study that was published in December of 2020 on the value of “water cooler talk.”

The study, out of the University of California at Santa Cruz, suggested that in settings where people are working together on a task, making time for small talk allows for a newly defined behavior called “reciprocity in conversation,” which is associated with higher levels of task enjoyment.

“Whether in the workplace or our personal lives, most people have a strong preference for balanced conversations, where each person is able to ‘get their two cents in,’” according to a summary of the study. “In fact, new research published in Language and Speech shows that people take corrective action to ensure a two-way flow of conversation when situational factors, like defined roles for working together on a task, create an imbalance in how each person is able to contribute.”

In other words, everyone’s voice can be heard.

Furthermore, “Where people are working together on a task, it’s actually associated with higher levels of task enjoyment. This could have fascinating implications for employee morale in work settings. But there’s a catch. In order for conversation reciprocity to take place, the people collaborating on a task must make time to incorporate small talk into their work.”

The timing on this could not be better, given that employees are increasingly working in remote environments, a point amplified by Andrew Guydish, a Ph.D. student in cognitive psychology and lead author on this research.

“An average workday now is getting the team together into a virtual meeting, where there’s a very clear goal and task,” Guydish said. “You’re not talking to coworkers at their desk or in the hall. Everything is structured, and everything is essentially a task nowadays. So, this research highlights the importance of perhaps trying to institute moments throughout the day with unstructured chat time.”

The study’s authors suggest that it is “in those moments that reciprocity (can) work its magic. Typically, when peers are working together on a task that requires one to direct the other, it creates a natural imbalance in the conversation, where the person in the leadership role ends up doing most of the talking. But if the participants also have unstructured time available, the person leading the task-based conversation can use the opportunity to pull back on their contributions, essentially yielding air time during small talk to the other participant.”

That’s reciprocity, which ultimately leads to better decisions. And a more successful small business.

Non-Competes: Starting Off on the Wrong Foot with a Few Exceptions

Non-Competes: Starting Off on the Wrong Foot with a Few Exceptions

Among technology startups, non-compete agreements are a staple.

Without them, sales professionals might more easily take their book of business to a rival for a better salary. The same goes for technologists, who are privy to a company’s intellectual property.

These are “grip and rip” scenarios, which point to the value of such agreements. Someone is trying to do harm to your business. You need protections.

This is different from someone who is simply trying to get paid what they are worth. Companies should never be able to imprison an employee so that they must stay with them.

Given my philosophy on this, recent research out of the Robert H. Smith School of Business at The University of Maryland recently caught my attention. There, four research papers are set to be published in top journals, co-authored by management professor Evan Starr, who addressed the debate over whether non-compete agreements help or hurt employees. Professor Star’s conclusion: Non-competes stifle workers.

In “Non-Compete Agreements in the U.S. Labor Force” in the Journal of Law and Economics, Starr presents the most sweeping work in what represents the first systematic investigation of non-competes in the United States. In it, he studies a nationally representative sample, looking at all sorts of workers.

One of the key findings: Non-competes are found even among low-wage workers.

“There have been anecdotes of that fact, but this is the first systematic evidence,” Starr says. “This is shocking, because when you think about non-competes, you think about tech workers and executives—you’re not thinking about doggie-daycare sitters or hairstylists or yoga instructors, but that’s the modal worker that’s bound by a non-compete. Our paper launches from that fact, and the key question for policymakers is whether this a good or a bad thing.”

Starr concludes they are bad, which I agree with, except in specific circumstances.

“The argument for why they are bad is pretty clear,” Starr says. “Take the case of the low-wage worker, earning $12 an hour, who gets a better offer at a competitor to make $15 an hour. A non-compete could prevent them from making those sorts of moves that are going to enhance their social and economic mobility.”

Collectively, Starr’s papers show that workers do better without non-compete agreements. The same can be said for companies.

Firms may be less profitable if they have to pay workers more, according to Starr. But there is definitely a benefit for them, too. Without so many non-competes, firms have better access to the labor pool and can hire the workers they want to hire, including those from a competitor.

Small businesses are built on trust. While in some cases, for some positions, non-competes may be necessary, we need to move away from the idea that they are standard practice.

“It’s not really a firm versus worker issue,” Starr says. “It could be a win for both workers and firms.”