Running a family business may look easy enough from the outside, but beneath the cheerful "mom and pop" exterior, many disputes can arise, ultimately threatening the very life of a family-run business. Don't wait until things get out of control and profits suffer, or worse; face these problems head-on.
1. Allocate Vacation Time, If The Business Is Healthy Enough
Running a business takes a lot out of employees; however, when you factor in the personal relationships and typical tensions from family, the stress factor is multiplied considerably. If your family business is healthy enough, make vacations a mandatory part of employment. Even a few days off can relieve the stress that naturally builds up, leaving people more prepared to handle situations with clarity and wisdom, instead of exhaustion and emotion.
2. Identify The Source Of Friction
There's a major difference between dealing with the "normal" stress and strain of running a business and facing a particular conflict involving the same individuals all the time. If two (or more) people simply aren't able to get along, you must address the situation and find some resolution, or risk running yourselves ragged and quite possibly, the business into the ground. Identify who isn't getting along and why and call meetings, institute more interpersonal training and try and put the disputing individuals together in a manner conducive to constructive conversation. As tough as it may be to accomplish, failing to address the inner friction could be much worse.
3. Restructure The Hierarchy
Sometimes it's hard for family members to face the rank-and-file in the business, particularly if there are rivalries or the hierarchy within the company is very different from the hierarchy within the family. For example, if a grandfather is accustom to commanding the clan during holidays, other family celebrations and even emergencies, but holds a lowly position within the business, this may cause resentment on his part. Also, whoever is in charge of him professionally may be intimidated out of making the best business decisions in the professional environment. All kinds of family dynamics come into play and if the family hierarchy and business hierarchy are at odds, relationships naturally deteriorate on both sides
4. Formalize The Employee Agreements Of All Family Members
Because family sometimes feel they can get away with doing things differently than other employees, your business may not be running as smoothly as it should, creating problems for those members that always show up on time, work late and put the success of the company ahead of their own needs. Make sure each family member pulls their own weight, without exception, so the business has a better chance of doing well and no members (of the family or other employees) are left with an undue burden to pick up the slack.
5. Identify Everyone's Expectations
It's important to be aware of the expectations of your employees, but especially the individual family members. If one person expects to be given more authority over employees, simply because he's a family member, this should be addressed formally and professionally, or you may risk losing a string of qualified employees who feel slighted by the presumed authority imposed on them. Another family member may have the expectation that they're only required to do certain jobs, such as those that are easier or don't involve getting dirty hands, which is perfectly fine, so long as everyone involved is aware and accepting of it. Different treatment and favoritism in a family business can spell disaster in terms of valued employee relations.
6. Consider Family Business Counseling
When the family members of a business simply can't get along, the next logical step should be some form of counseling. For initial evaluation purposes, each member might be interviewed in confidence, followed by an open meeting involving everyone. Somehow, the counselor will have to identify and isolate the crisis-causing issues and try to bring everyone together in solving them.
7. Litigate Disputes As A Last Resort
Eventually, your family business may end up in formal litigation, either because you can't find resolution on your own or a changing business strategy calls for outside intervention. Resolving issues with legal finality can help everyone eventually come together, because it's no longer a matter of opinion or family tradition that dictates the direction of the business, it's the law.
Business litigation is a formal and legal process, structured to address the unique complexities faced by companies and commercial enterprises and it should help your family business to resolve a number of issues:
- Disputes between shareholders
- Partnership conflicts
- Employment and contractor problems
- Intellectual property, copyright and patent disagreements or potential infringements
- Investor complaints and grievances
- Buying out the shares of other family members
Solving the problems your family business runs into, rather than ignoring them or trying to sweep them under the rug, is the only way to keep the business alive and well. While conflict in any working environment can be natural, it's even more likely when everyone is related to everyone else somehow, and profits are on the line. Keep a close eye on all professional relationships and tackle issues as they arise, in order to avoid a major business, and, therefore, familial catastrophe.
