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 As with all groups and relationships each member comes with their own views, opinions, values and beliefs. Personalities of all types come together, including conversative, traditionalist, liberal or progressive thinkers each with their own agenda.  

Family Business are no exception. 

Put in the spotlight, we see Family Business enterprises are unique in that their personal and professional realms are intertwined. Family Members are the drivers, with the power to influence decisions, they govern, own and control operations. But this doesn’t equate to cohesion, they are no different when it comes to differences. Relationships can be strained, and tensions arise. 

Do you recognise this scenario in your family Business, 'Mary feels overlooked in the promotions, with little opportunity for growth. Discontentment that is festering as sibling rivalry with her brother. Friction now hampers both their performances'. If ignored this can undermine the operations.

The key is to understand the issues and mitigate potential conflict by taking preventative measures. Foster a harmonious work environment. Happy workplace, happy family.   

6 Common differences 

1. Differing Values, Goals and Family vision 

2. Lack of Clear Roles and Responsibilities 

3. Difference in Work Ethics 

4. Power Struggles, Jealousy, Favouritism 

5. Lack of Governance 

6. Greed, Self-Interest 

1. Differing values, goals and family vision  

A shared vision may not exist. Members can have their own thoughts about the Business future, with different generations having varying views on market changes. Some support growth and expansion, risk, innovation and are ready to steer the Business that way while others believe in staying faithful to and preserving founding traditions. This can lead to friction.  

Tip: To move forward, bring Members together to discuss their goals and values, and work towards aligning and creating a shared vision.  Most importantly, this is about building family unity, a collective vision for both the Business and family’s future, a Guide for now and shared with future generations.  

2. Lack of Clear Roles and Responsibilities 

It’s not uncommon in Family Businesses for family members to have multiple roles and responsibilities. The problems arise if these are not clearly communicated and defined. This can lead to conflict when there is no clarity around who is responsible for what. Personal and professional relationships and boundaries are sometimes difficult to separate which can also lead to misunderstandings. 

Tip: Establishing clearly defined roles, titles, responsibilities and boundaries for each family member can help prevent conflicting expectations and misunderstanding. 

3. Difference in Work Ethics 

Different levels of commitment to the Business, to the ‘task’, can vary between family members, with some considered as not pulling their weight. This dedication or lack of can cause conflict when others must carry the load. Generational differences concerning entitlement and effort required are sometimes symptoms. 

Tip: Underperformance needs to be addressed whether by family or non-family members. Job, roles and responsibilities need to be established for all positions with penalties for poor performance. Accountability is key to fostering and keeping workplace harmony. 

4. Power struggles 

Power dynamics are complex when in play, with different members vying for control, these can be hierarchical or generational struggles that if ignored can compromise the enterprise. With a perceived imbalance of power conflict can arise. Often these imbalances are manifested and increase as ownership is diluted over the generations. Entitlement, rivalry, favouritism and nepotism can also raise their heads in these disputes and can threaten Business stability. 

Tip: Importantly develop decision-making processes that consider family dynamics, power and Business priorities. Additionally, prepare for the future by preparing the next generation. Minimise ‘sense of entitlement’ by adopting various strategies, including Transition and Succession planning.   

5. Lack of Governance 

Without strong governance, structure, policies and practices any enterprise is at risk. Family Business is no exception. Governance structure is crucial related to family employment, shareholders, leadership and decision-making responsibilities and parameters. Examples include employment and termination policies, prenuptial and compensation guidelines. 

Tip: Define, develop, and incorporate governance policies and procedures into Business operations. Ensure adoption and implementation is flagged with periodic review to monitor currency, relevance and suitability to respond to possible family and Business changes. 

6. Greed, self-interest. 

Greed and self-interest have been the cause of much grief since time began and yes today, it is still with us and does happen in Family Businesses causing conflict. It comes in various ways, silent members extracting money, sibling expectation and entitlement, contribution or lack off, or uninvolved members that expect returns despite not contributing. Generational financial abuse is another example. 

Tip: Families are unique as are Family Businesses. Keeping sight of what ‘family’ is, means and embraces is paramount.  What is the family, Business, legacy? Ultimately no amount of money is worth family fights, court battles and a Business that ends in conflict and closure. 

Takeaways 

• Differences arise and Family Businesses are no different.
• Key is to take preventative measures to address and mitigate issues as they arise. 

• Adopt best practices, policies and procedures, implement and follow.  

• Schedule regular family meetings to stay informed, maintain open lines of communication and address any issues.  

• Seek outside professional help if needed. Engage a Mediator or Family Business advisor.