Conflict In Family Business
Conflict is a normal occurrence in everyday life. Although many assume that conflict is harmful, not all conflict is negative. Some conflict is healthy and ushers in necessary adjustments to process and operations. In a family and a family business, there are various types of conflicts. Being able to identify conflict and managing it appropriately is essential for the sustainability of the family and of the family business. Here are some examples of conflict that may be found within the family and the family business:
Sibling Conflict. Siblings are natural friends and equally so, can become natural rivals. In most cases of sibling conflict, the conflict arises from sibling rivalry. Some Causes of sibling rivalry are:
competing for parent's attention and affection.
Seeking for parent approval.
Different priorities within the family or business context.
Competing against each other.
Sibling conflict, unless resolved, can cause problems in their ability to work together towards a common good. At times competitiveness can become toxic if it is against each other: a good example is within the family business if siblings have to work together but take their competitiveness against each other to work. Without clear boundaries, they may cause other employees to take sides or even give conflicting instructions or policies that then effectively ruin the everyday operations of the business.
To manage sibling conflicts, the nature of the conflict must be identified, and methods of resolving or managing the conflict put in place so that the relationship of the siblings is preserved and more so that the operations of the family business is not disturbed. One such method to assist with such conflicts is a family business constitution. It may not directly solve the conflict, but it will give guidelines as to the family values and applications of those values in the conflict and the business as a whole.
Operational conflict. This is conflict that occurs in the everyday operations of the business. Families are complex in nature, and they are made up of various individuals that have different thoughts and beliefs about the values of the family and the business. Without clear direction on what the values, vision, and mission of the business is, conflicts arise. Some members of the family may value the monetary gain the business offers, while others may appreciate the shared goals and unity of family that the business represents. In such cases, the family must find a middle ground. A family constitution helps document and clarify the family values while ensuring every voice and need is addressed in a way that if an operational conflict arises, it can be resolved in a way that sees all parties' voices being heard. Equally so, as values change and the family changes and evolves, so will the constitution.
Spousal Conflict. As families grow, so do their various networks. Each time there is a marriage or birth, the family grows bigger. And the complexities of the relationships deepen. One such complication is marriage. How do family businesses handle marriages and the in-law and in-laws that come with it? How do families and family businesses handle divorces and the similar complexities that come with it. In some famous cases of family businesses, we find that the new in-law can be blamed as the source of new family conflicts. And this conflict has the potential of overflowing into the family business. Issues of do in-laws get jobs within the family business and what expectations or qualifications apply. Similarly so, so in-laws her shareholding and when. Professional advisors can help families navigate the legal and moral complexities of the spousal conflict and help the family business formulate the appropriate solutions that apply to their needs.
Assumed conflict is our final conflict on this list. Assumed conflict is the conflict that occurs when there is assumption and no clarity on issues or actions that are taken by a family member within the business or in a way that affects the business. The other family members and the public may also assume due to speculation that there is conflict when, in fact, there is not. If clarity in communication is not taken immediately, then the assumed conflict may quickly escalate to become an actual conflict that may have a negative impact.
It is necessary to note that this list of possible conflicts that may occur in a family and its business is by no ways, exhaustive. What is crucial to note is that all the conflicts may sound negative or may seem to have negative impacts on the family business and the family itself; however, this is not always the case. As stated at the beginning, some conflicts create the opportunity for resolution of long-standing issues and, in other instances, opportunities to review values or traditions that need refreshment. Tradition holds us together, but innovation and development make us stronger and more capable in the face of different generations and the forward advancing world. For families and their businesses to last through many generations, there must be accommodation of the values of the new generations as much as the understanding of the need to grow differently if needs be.
How does your family deal with conflict and conflict resolution? Has it ever affected your family business, and how?