Tough conversations are part of any business, but when family is involved, they can be even more complex and charged with emotion. In a family business, discussing finances, roles, and succession planning can be difficult because, in addition to business interests, personal relationships are on the line. However, when handled correctly, these challenging discussions can become a way to grow, create stronger bonds, and to becoming a more resilient business.
In family business, tough conversations can be challenging but, when approached thoughtfully, they can transform into valuable opportunities for growth, unity, and long-term business success.
Create A Culture Of Open Communication
I talk about open communication often. This is intentional as it is critical for success in any family business. Establishing a foundation of open communication is essential for managing difficult topics. Families that cultivate an environment where everyone feels heard and respected can approach tough subjects with less tension. Open communication means encouraging every member, whether family or non-family, to share their thoughts without fear of judgment or backlash. To enable this, consider setting regular meetings dedicated to open discussion on key topics, such as business performance, individual concerns, and future goals.
These sessions allow family members to express their views early, helping to avoid misunderstandings and fostering a proactive approach to resolving potential conflicts.
Use a neutral facilitator if needed. For sensitive topics, bringing in a family business advisor can help family members communicate openly and resolve issues before they escalate.
Separate Emotions From Business Discussions
In family business, emotions can run high due to long-standing relationships and personal histories. Recognising when emotions are affecting a conversation and consciously separating personal feelings from business objectives is crucial. This doesn’t mean ignoring emotions altogether; rather, it involves addressing and acknowledging feelings while still focusing on making the best business decision. Acknowledging that emotional responses are natural helps family members approach conversations with empathy and patience, minimising the risk of conflict.
A good strategy is to set ground rules to keep conversations productive. For instance, agree that discussions will focus on solutions rather than assigning blame and that everyone will be given an opportunity to share their perspective.
Use Tough Conversations To Clarify Roles And Responsibilities
One common challenge in family businesses is blurred lines between personal and professional roles. Difficult discussions about performance, contributions, or future roles can be uncomfortable, but they are also opportunities to clarify responsibilities. Addressing these issues head-on allows each family member to understand where they fit into the company structure and the expectations attached to their role. While your role within your family will never change, your role within the family business can change and evolve over time.
For instance, if there’s a tough conversation around leadership succession, it can serve as an opportunity to evaluate who has the necessary skills, experience, and vision to lead the company forward. Having these conversations can prevent misunderstandings, resentment, and rivalry, allowing for smoother transitions when the time comes for leadership changes.
It is important to document each role, responsibility, and expectation to provide clarity and accountability. This can reduce friction and prevent conflicts arising from misunderstandings or unmet expectations.
Focus On Shared Values And Long-Term Goals
In family business, shared values are often what binds the company together. During challenging conversations, it’s essential to reframe discussions around shared goals and values. Emphasising common objectives, like ensuring the longevity of the family business or maintaining the company’s reputation, can help family members stay focused on what truly matters. This shared focus can prevent discussions from becoming overly personal and remind everyone of the bigger picture.
If family members disagree on strategic decisions, like expanding into new markets or reinvesting profits, anchoring the discussion to the shared goal of creating a legacy can help them find common ground. Even if members don’t agree on every detail, aligning with the company’s vision and values provides a framework for decision-making that benefits everyone.
Encourage Ongoing Learning And Development
Tough conversations can reveal skills gaps, differing perspectives, or even weaknesses in the business model. For instance, if a difficult conversation uncovers that one family member lacks certain skills for a role, it can be an opportunity to encourage training or mentorship. Family businesses that embrace learning as part of their culture can use these insights to enhance the overall capabilities of their team.
By encouraging ongoing education, family members can approach tough conversations with a growth mindset, seeing challenges as opportunities for improvement rather than threats to their position.
You might want to consider creating a development plan for each family member based on their goals and skills. Investing in professional development not only strengthens the business but also demonstrates that growth is valued at all levels.
Embrace Accountability And Transparency
In any business, and especially in a family business, transparency is essential. When tough conversations arise, it’s important to hold each other accountable to ensure follow-through on agreed actions. If, for example, a family member has committed to taking on a new responsibility, ensure that everyone is aware of this commitment and has access to the progress being made. This transparency helps family members see that everyone is contributing fairly, reducing the risk of resentment and promoting trust.
A great tip is to establish clear action steps and timelines after each conversation. Keeping these transparent ensures everyone is held accountable, demonstrating fairness and respect for all contributions.
Turn Conflict Into Innovation
Difficult conversations often bring different ideas and opinions to the surface. Instead of seeing these disagreements as obstacles, view them as a breeding ground for innovation. Different perspectives can lead to new solutions that might not have been considered otherwise. For instance, a discussion about diversifying the business might spark ideas for a new product or service that no single family member had previously envisioned. Embracing conflict as a source of innovation not only resolves issues but may also propel the business forward with fresh ideas.
Encourage brainstorming and respectful debate during challenging discussions. By asking each member to contribute their ideas, you create an environment where innovation can flourish.
While the process of turning tough conversations into growth opportunities may be uncomfortable, these conversations can ultimately strengthen the business and the family bond. Difficult conversations are often where breakthroughs happen. For family businesses willing to embrace these discussions, they can lead to deeper trust, greater understanding, and a more unified approach to achieving shared goals. With the right mindset and strategies, tough conversations can become a powerful force for growth, both for the business and the family.
About the Author - John Broons is a globally awarded family business expert. One of only three people in Australia to hold the coveted title of Fellow of Family Firm Institute (Boston, USA), John has dedicated his working career to answering the question: how do I guide and support families in business to a place where they’re thriving? Find out more by visiting his website here
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