Family businesses are incredibly sensitive. Like they say, never mix business and pleasure. Well, that’s exactly what family businesses are all about. Members of the family wear different hats at different times. During the day, the parent, son, husband, sibling or wife, might become the boss and in the evening, the roles might reverse for familial interaction, decision-making and parenting. As you may imagine, that’s not an easy transformation and often, behaviors in one role could be in odds with situations that arise in another, resulting in conflict.
Some family businesses are “mom-and-pop” shops that expand into larger businesses. But, on other occasions, there are family businesses that have been carrying on for generations, involving the extended family and generations of members. The dynamics in those businesses can be even more complex. The interesting part of family businesses is that each one is very unique – more so than corporations that all often follow similar rules to ensure a workplace that is enticing for regular workers. Since family businesses are less dependent on “outsiders”, their rules are flexible and often very different from other businesses. Now flexibility is a great thing for most cases, except that when dispute does arise, which are inevitable, families are often not prepared to handle it like corporations are. The emotional stake that each member carries can make it impossible to carry off objective negotiations that yield logical win-win situations. By the very nature of the business, what’s good for the company may not always be good for its people.
Historically, family business disputes have been laggards when it comes to getting professional help. Families hesitate to put their “personal” problems, even though they really are professional in nature, in front of the world. They turn to family elders or even just ignore the problem for years at a stretch and resign to the fact that there is seemingly no solution or this conundrum.
In recent years, however, more and more families have turned to mediators. Mediators can help years before the situation escalates to the point where dissolution or courtroom settlement is needed. In most family business cases, mediators use the follow steps to arrive at long-term win-win situations.
- They take the time to understand the company’s and the family’s history and its key participants. They hold individual interviews as well as group sessions with key participants to understand them and their roles in the business and in the family better. Participants are much more likely to share these details with a mediator that’s a third party with no personal bias or emotional stake in the family or business but someone that deals with the issue as carefully as a relative would.
- They set the rules that the family often ignores to do. They help re-engineer roles and processes to align with the best interests of the family and the business that can lead to long-term harmony. Change is often difficult to swallow initially but through detailed negotiations and equipped with tools and experiences developed over a life time of professional negotiations, mediators are able to bring family members at ease with the path moving forward.
- Best of all, family members now operate at ease knowing that they have someone to turn to. Someone that is intimately involved with the family business without the personal bias.
Family businesses that have lasted years have understood the value in keeping a mediator involved with their family for their peace of mind and their company’s success. Mediations are even becoming part of many small business contracts. Instead of writing details clauses that describe “what if” scenarios and rules around their handling, they simply mention the use of a mediator to resolve any potential conflicts.