Starting and Developing the Practice
The impact on you and your family
Chris Swaffin-Smith B.Sc M.Phil

Introduction

One issue that many individuals raised during the programmes that we have run on Practice Development, was that of the impact of starting up, and developing a successful practice, on their relationships within the family. For some individuals striking the right balance between the two had proved to be difficult and stressful. Many people understandably find this difficult to talk about because they see it as a personal issue.
 

Overlapping Family / Business issues

The questions that private practitioners were having to address, or which they had addressed included:

• Why am I starting my own practice?
Am I looking for more independence and flexibility in my working life? Do I want to be more involved in doing work I enjoy? However what impact will this have on; our income in the short and medium term; the time we have to send together as a family; and our relative levels of self esteem What impact might it have on the wider family?

• Whose practice is it?
Does this practice belong to me or does my husband/wife have a stake in it? If I am going to set up a limited company, is my partner going to have a share in the practice, how big will this share be and what are the implications of this in terms of the way in which we make decisions? Would this mean that the way in which we make decisions in the business will be different from the way in which we make decisions in the family? Are we able to adopt two different approaches? What are the potential financial implications of the way in which we are viewing the split in ownership

• What role are we each going to play within the family and within the Practice?
Will my partner act as an adviser even though they are not working in the business? What will be our individual tasks within the family and what happens if either of us are not able to complete these because of unforeseen issues at work? If my partner works for the practice what are they going to do and who decides how it should be done?

• What are the potential sources of conflict in our having overlapping roles?
What happens if it takes longer to develop the practice than we imagined and our level of income suffers? What happens if we disagree about the relative time I am spending working in the Practice as opposed to spending time with the family? How will my partner react if I disagree with the advice that they are giving me with regard to the management of the practice? Will we be able to separate the practice from our family life or will I allow the practice to run me?

• What impact will my continuing to grow the Practice have on family life?
What happens if growing the practice puts increasing pressure on our family finances and income? Will we all be comfortable with potentially increasing the level of risk to the family? Will my partner feel that they are less involved with the Practice and therefore with me ,if I employ other people and take advice from outsiders? Will our relationship be effected because of my success? What will happen if I recruit someone on a full time basis to complete the role they have been doing on a part time basis? How would we deal with a situation where either or both of our personal circumstances changed which meant that it was difficult for me to sustain a busy Practice. How would I fell if other members of the family decided they no longer wanted to be involved with the practice?

• What impact would my giving up or selling the practice have on the family?
Would we have to renegotiate our relationship? Would my partner feel that they had lost a key interest in their life because they had been so involved in the development of the Practice? What would be the financial implications of giving up the Practice?
 

Achieving an appropriate balance between Family and Business

The private practitioners we spoke to felt that wherever possible we should strive to:

• Discuss our aspirations and those of other members of the family when we are setting up in practice and then at regular intervals after this.
Discussions should include; the impact that setting up in practice is likely to have on the family and the way in which we relate to one another and the sorts of things that might go wrong and how we will respond to these. The more frank and honest that everyone is, the better.

• Agree on how we are going to keep the Practice separate from the family.
This by agreeing family time for example. However this also means that we as practitioners should avoid a situation where the Practice runs us and we are not able to devote sufficient time to the development of our family relationships. Charging your patients too little and then working excessive hours to do what we need to do to develop the practice, can mean that the whole family are subsidising our patients.

• Formalise the ownership relationship.
This becomes increasingly important as the Practice grows in size. For example if other family members are going to have a stake in owning the practice, what proportion will they own? Are they going to become a partner in the practice or are you setting up a Private Limited Company? If so what proportion of the shares will they own and why? What impact might this have on your ability to grow and change the business?
 
• Formalise the working relationship.
Again this becomes increasingly important in a situation where members of the family work for the practice on a full or part time basis, Clarify their role, give them a contract of employment, and in every way treat them as an employee of the practice. There have been instances in the past where family members have taken other members to Court on the grounds of unfair dismissal! Equally changes in the Practice may mean that you may have to make your partner redundant if you are a Sole Trader or have a Private Limited Company. Incidentally this is just as true in the case of friends working together If you do not formalise your work relationship, this can ultimately lead to a breakdown in your friend ship and your working relationship.

• Consider taking out insurance in the case of being ill and not able to treat patients. Without this the family may be burdened with having to pay the fixed costs associated with running the practice as well as losing income.

• Consider redrafting our will so we treat our personal assets differently from our business assets.
This is particularly important where there are other people working within the practice and you want this to continue. Consider the implications of the practices ability to survive if anything happens to you.

• Seek appropriate professional advice in planning to deal for the unforeseen changes that can impact on the practice and the family.
A family business is a business as well as being an extension of the family. It falls under the jurisdiction of the same legislative framework as any other business. However changes in personal circumstances can have a proportionally greater impact because of the overlapping links between ownership, business and family.
 

In Conclusion

Starting up and developing a practice is a journey not a destination. All sorts of things are likely to happen to the family individuals within the family, and the business on the way. Therefore the relationship between the three have to be continually reviewed in order to ensure that everything is in balance. The more the practice is managed as a business and seen as a separate entity from the family the better.