Tuesday, May 29, 2012
In an average business, relationship conflict is unpleasant. In a family firm, it can be downright devastating. Family firms are comprised of dynamic and complex interpersonal relationships, prone to spark fights concerning everything from succession planning and mixing family and business roles to the lack of formal organization. A common oversimplification is that the family is emotional and the business is unemotional. This is simply not true. Family and business is a powerful mix, and it’s not easy, or even possible, to keep the two separate.
It’s important to distinguish between productive types of conflict and destructive types of conflict before nipping family squabbles in the bud. The term “conflict resolution” is misleading because it implies that all conflict should be squashed immediately. Current research shows that conflict among family members can actually be a good thing because it increases options, prevents premature consensus, and improves the involvement and motivation of family members. Without conflict, family businesses can remain stuck in their ways, not realizing comfort has become synonymous with stagnation.
Too much relationship conflict is how family businesses can be destroyed. Relationship conflict is the perception of personal animosities and incompatibility between family members. Snide or mocking comments and constant bickering create a toxic work environment for everyone, not just the relatives fighting. Poor attitudes or employees that don’t speak to one another often serve as signs for interpersonal conflict.
Whereas relationship conflict should be avoided, task conflict and process conflict should be encouraged. Task conflict is debate over the business’s goals and strategies and stems from disagreements over which tasks should be accomplished. For example, families experience conflict due to opposing directions from two bosses, uncertainty about the timeframe necessary for completing tasks, and the relative importance of multiple job goals. Task conflict improves decision-making outcomes and productivity by increasing the quality of decisions through extensive dialogue. Members are more accepting of final outcomes because they’ve had the opportunity to consider various facets of the decision at hand, as well as consider everyone else’s input.
Whereas task conflict concerns what strategies to accomplish, process conflict focuses on how to achieve goals. For example, conflict may arise over how work is divided between team members, how various projects are assigned, and the way in which job activities are handled. Family members sometimes work in the business without specific educational or employment experience. As a result, they sometimes hold higher organizational positions than they would with careers outside the family firm. Firms may have difficulty adjusting roles and responsibilities as needed for each family member. Process conflict is a good way to ensure each member’s talents are used effectively and efficiently.
Relationships act as the glue of both the firm and family, determining how stable each is. If there’s a strong foundation, the family can thrive with a healthy dose of debate over tasks and processes. On the other hand, if members are on edge due to relationship conflict, the business may lack the stability to engage with healthy conflict.
Leah Golob is a writer and researcher with the Business Families Centre. The Business Families Centre at the University of British Columbia provides education and support to business families and family enterprise advisors, including coaches, family therapists, lawyers, wealth managers and accountants. The BFC is partnered with the Institute of Family Enterprise Advisors (IFEA) designating body and offers the Family Enterprise Advisor Program in Vancouver and Toronto.