According to Josh Baron, Columbia Business School Professor and co-founder of Banyan Global Family Business Advisors, without a healthy dose of conflict, family businesses “can suffer from limited growth, poor decision-making, a loss of competitive advantage, and, in severe cases, the sale or split of the company.”
Navigating through moments of conflict in a family business setting is no easy fate. While too much intervention can tear relationships apart, too little is also not the answer. The key lies somewhere in the middle. Here are three questions your family business should discuss to see if your business lies in the middle.
First, are your employees (especially family member employees) generally satisfied with the direction your family business is headed? Complete satisfaction is almost impossible to achieve, but the majority of your team should be happy spending time together working on bettering your business.
Second, are points of disagreement being permitted and discussed before critical decisions are made? While every point of disagreement is impossible to address, obvious concerns must be openly discussed and considered before your family business makes any crucial choice.
Third, are your family and work relationships strong enough to be celebrated together? In most families, not all relatives will get along, but the strong familial bond keeps these uneasy relationships alive. Your family business is no different. Not every employee needs to be extremely close, but the motivation behind being a part of a successful business will strengthen distant relationships.
Regardless of where your family business stands on the spectrum of conflict, it is important to be able to identify the various forms of conflict family businesses experience.
Conflict can be external or internal. External conflict embraces outward expressions of anger, like yelling and screaming, while internal conflict derives from more subtle expressions of disagreement, such as silence and passive resistance. Although it may be tempting to devote more resources to preventing external moments of conflict, it is essential that your family business should also devote a significant amount of effort to reconciling internal conflict.
Moments of both external and internal conflict can neither be tolerated nor eliminated. So once your family business is able to identify conflict, your next step is to come up with a plan to manage it. The services of a trusted advisor may be necessary to develop and implement such a plan.
The appropriate level of management depends on the intensity of external or internal conflict your family business experiences. Family businesses with high levels of external conflict should focus on providing conflicting relationships with a calm environment that fosters constructive conversations. In contrast, family businesses with high levels of internal conflict should focus on providing various opportunities for family employees to be respectfully heard before, rather than after, critical decisions are made.
While conflict may not desirable, it is expected. So rather than silently avoiding confrontation or aggressively expressing disagreement, approach conflict with a management plan tailored to your unique family-work culture so your business can continue to improve.