Problems with Family Employee Not Producing

Question

I have watched the Venture Academy videos and I have a question regarding our family business. I have a family member who has been working in our family business and the goal was that he would help grow the business, but since I put him on salary, he is not producing enough to justify his pay. Please advise.

Answer

I would recommend moving your family member to a “Pay for Performance” type of compensation plan where they only get paid for what they do. Please see my example in the Venture Academy in the Human Resources principles section titled “Pay for Performance” when I described the three ladies that worked in the water bill processing department in first company I acquired and how changing the compensation plan from a base salary to a variable format completely changed their behavior.

For additional reading on this topic, please my Q&A post Motivating Employees.

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