Updated: Apr 15, 2020
Disputes are a challenge for every business; however, what if the dispute is between family members?
Disagreement is one of the major reasons why family businesses fail when transitioning between generations. Whilst open and honest communication can sometimes lead to disputes, how family members communicate within their business will ultimately determine how the business survives in the long-term.
Family business members need to develop excellent communication skills. The business needs to develop processes and procedures to best deal with disagreements and position the business to be successful in the long term. Family businesses need clear roles and responsibilities of its members, management and staff.
Here’s a few tips to consider:
1. Never start a discussion whilst you are still emotional.
Allow time to pass and for all parties to cool-off and regain composure. It is important that everyone is calm and prepared in order to have a meaningful, professional conversation about an issue or concern.
2. Find common ground.
Finding a common, agreeable place to start is best. The underlying reason for being in business, the purpose of the business, its strengths; are all great places to start.
3. Identify the core issue/s.
Often, disputes arise from one-off events that are underpinned by long term issues or gripes. It is important to explore the core issues – below the iceberg water line, in order for progress to be made.
4. What does success look like?
Why is the family in business? What is the history of the business and what will the business look like in the future? Often disputes arise from disagreements on the goals of the business and less so on the strategies and tactics to get there.
5. What are the consequences of not dealing with the issue?
What does “do nothing” look like and what is the impact? Consider “worse case” scenario and your best alternatives.
6. Agree on roles and responsibilities.
Family businesses often lack the rigor and structure of larger corporates. Agreeing on roles and responsibilities provides clearer direction and accountabilities for everyone. Future decision making may also result in less disputes.
7. Hold formal meetings and set deadlines.
Family businesses benefit from conducting regular management meetings, including the taking of minutes or notes, and the assigning of due dates to the responsible party. Parties can then be clear on their roles and responsibilities as well as be held accountable for their actions. Management should also hold regular staff meetings, one-on-one meetings and periodic Manager-One-Up meetings.
Introducing change and/or dealing with a long-term dispute can be challenging to deal with alone. Engaging a professional, neutral party to assist plan, facilitate and document change is often a wise path to take.
The involvement of an external mediator or facilitator allows all parties the opportunity to work through their concerns in a fair, equitable and safe manner without fear of being bias toward an issue or solution.
If you are dealing with a difficult situation and would like help exploring options to move forward, reach out Maxwell Parker Dispute Resolution or email firstname.lastname@example.org.
Matthew Maxwell, Principal of Maxwell Parker Dispute Resolution, is a nationally accredited mediator (NMAS), a qualified Family Dispute Resolution Practitioner (FDRP) and a Professional Member of the Resolution Institute.