As advisors to high net worth families on the efficient operation of their homes, we often encounter clients struggling to balance the need to manage their homes with the desire to enjoy living in them. For some, a large home is simply another collection of complex assets, and a private staff is another group of employees. The need to lead and manage them both as consistently and professionally as you would any small enterprise is intuitive in order to maximize value, mitigate risk, and minimize operational dysfunction, including defects, rework, accidents, theft, disputes, turnover, and service issues.
For many, however, the home is meant to be an escape - from work, the public, and responsibilities. It is a place to relax and enjoy the fruits of so much labor. The idea that the principals need to play roles such as leader, manager, coach, auditor, traffic cop, and administrator are not only unintuitive, they are altogether undesirable. While these homeowners may understand that a home that is managed like a business is perhaps a good idea to keep things running smoothly, to keep costs under control, and to maintain a safe workplace and living space, they have no interest in any aspect of their home lives looking or feeling like work.
The truth is, however, a large home is in fact a workplace. Whether they consist of a few thousand or tens of thousands of square feet, well-maintained homes often employ professional staff (house-keepers, nannies, assistants, cooks, and/or other private staff members) and are usually cared for by dozens of contractors and service vendors who do nothing but work in private home settings for a living. It is every bit the workplace that an office tower is to an executive or a university is to a professor. And perhaps ironically, by treating it as a professional workplace, homeowners are more likely to experience the tranquility they desire.
By choosing to play only the role of 'customer' and allowing the staff and vendors to 'do their thing', you can expect the following 10 problems of a passively-managed home.
- Constant activity in your home. If you have not proactively developed a firm schedule for activities in your home (vendor hours, delivery hours, staff hours, cleaning schedules, low-traffic / low-noise hours, etc.), expect staff and vendors to be in-and-out on a constant basis.
- Frequent interruptions. If you have not clearly communicated what decisions should be made by whom and when, and how often you wish to be involved, you should expect to be asked to make decisions daily (and nightly).
- Inconsistent service. If you have not documented your house rules and expectations for behavior, cleanliness, and personal preferences (whatever is important to you), you can expect that some staff members will fail to meet your expectations (you may frequently say 'these people lack common sense'). Others will meet your needs one day, miss them the next.
- Accidents. Unaware and untrained, staff and family members are more prone to injury in an unmanaged environment due to common workplace hazards (slips/falls, unsafe lifting practices, etc.).
- Illness. Staff and family members may suffer from illnesses due to poor food safety precautions, unsanitary work habits, and the lack of a sick leave policy.
- Theft. Where staff and vendor screening is poor or inconsistent, expectations are low or unclear, vendors and staff are unsupervised, physical security practices are lax, staff turn-over is high, or staff feel under-appreciated or under-paid, theft of money, personal belongings, or household supplies may be rampant.
- Disputes. Lack of authority and clearly delineated responsibilities contribute to infighting and power-struggles of which you may or may not be aware.
- Turnover. Unclear expectations, poor leadership, lack of communication and recognition, or uncompetitive compensation (as well as the other issues above) all contribute to turnover. If you have hired more than 5 employees for any particular position in the last 5 years, you should expect that word is out that your home is not a great place to work (whether that is true or not)…perpetuating the issue as better workers steer clear of your open positions. If you pay legally, you can expect unemployment claims. If you pay illegally, you can expect a call from the IRS or Labor Department.
- Lawsuits. Whether from accidents, poor employment practices, a perception of vulnerability, or simply unfavorable labor relations, you can expect a higher incidence of lawsuits.
- Wasted time. All of these issues will rob you of free time, the one thing money cannot buy.
So the decision is not whether or not your home should be managed like a professional workplace, it is a matter of how you go about doing it.
If your time, talents, and interests allow, take a more active role. At a minimum, establish your vision for what this enterprise is about, how it should feel, who is best-suited to work there, and what is and is not acceptable to you (if this sounds like mission, vision, values, and standards - it is).
If you are not sure where to start, find an analogous environment you want to emulate. Is your home more law office, Disneyworld, or Ritz-Carlton? If you don't share your desires, expect it to be more Barnum & Bailey.
Next, develop the household schedule, quality standards, employment practices, vendor management practices, budgeting, communication, and workplace safety.
If you'd rather not assume this role, consider empowering an employee, whether it be a six-figure professional estate manager or household manager or your housekeeper who is bright, capable, and open to new responsibilities. If you can't find the right balance, consider a part-time household manager or personal assistant.
With active household management, behaviors and standards fall in line with your expectations. Activity becomes more predictable. Employees and vendors are happier. Risks (both seen and unseen) are lower. And at last, you can enjoy a home environment which works for you, the customer.