Conflict in Family Businesses

Conflict in Family Businesses
By: David Bork, Family Business Matters (2016)

Every family experiences conflict. It’s a fact of family life. Families who take the time to learn about the dynamics of conflict and how to either keep it from becoming destructive when it happens, or develop conflict resolution skills to address it when it does, stand a much better chance of not letting it destroy interpersonal relationships.

With families who share a business or wealth enterprise the stakes are higher. If interpersonal conflict isn’t constructively addressed or becomes toxic, the business can become the battleground, and a legacy of wealth can be left in ruins.

A vast majority of family business owners report that unconstructive communication and “historically-based” personal conflicts consistently impede progress and workplace harmony. When other employees know that family members are at odds, the workplace environment feels the stress and anxiety. Gossip becomes rampant. Everyone is impacted.

It’s important to realize that long before family members enter into a business relationship, they have a personal relationship. If there is a history of conflict and/or unresolved issues and "hurts", those issues and feelings remain just below the surface in the emotional memory of the relationship. When a  disagreement becomes an argument, historical injustices and resentments can come roaring back to life with a newfound ferocity. When this happens, conflict becomes destructive once again.

Second, on a neurological level, if both parties get triggered, they become stuck in "fight, flight, or freeze" mode. Some people lash out, some avoid, some shut down. When this happens, the limbic “emotional” brain is in control. The executive part of the brain which enables mindful awareness, rational thought and action is "offline."

Third, the most dangerous part of an unresolved conflict is when it has become emotionally volatile and reactivated. Secondary strategies and behaviors are enacted in an attempt to protect, win, retaliate,  manipulate, defend, and/or avoid. When this secondary behavior happens, it impacts others, both in the family and in the family business environment. The impact of unresolved conflict ripples out, affecting all those in relationships with the conflicted parties. The conflict wears away the social fabric of family and business. The hurtful heaviness of the conflict is palpable and people are caught in-between.

Fourth, unless we have learned and practiced otherwise, we will continue to act out our "ingrained conflict dramas and unconstructive strategies." The dramas of our past lives become more concrete.

Lastly, the fact is that conflict in a family business environment is complicated because of the unavoidable convergence/collision of deeply personal relationships with the demands of running a successful  company. Because of this complexity, conventional conflict resolution methods and techniques, which only focus on the resolution of the issue in question, often fail to achieve resolution of the conflict on a deeper relationship level.

What is the solution?
The solution would seem simple enough – keep family conflict out of the business. Keep “the personal” separate from “the professional.” Sounds easy but it is almost impossible to do when family members with long and often complex interpersonal histories share wealth or ownership in a business. It can be  extremely difficult to keep what we think or how we feel about a family member from influencing how we treat them in financial matters.

To keep conflict from becoming destructive it takes commitment, awareness, education, and skills. Members must make a full-hearted commitment to address the issue of conflict. Most of us don’t take the time to really understand conflict until we’re in the middle of it. The time to address it is before it happens. The reality is that nothing will change if we don’t make some effort to do things differently.

It takes awareness. We have to take an unflinching look at how conflict was handled in our family of origin and how those ways might be present in the family business. We have to take a serious look at our own  way of responding to conflict as well as that of others.

It takes education. What’s the difference between disagreement and conflict? What are the signs when disagreement turns into conflict? How does emotion prevent resolution? What is the best method to  resolve conflict between family members? What’s the most effective way to make conflict constructive?

Artful conflict management takes skill. Conflict can either bring family business members together or push them apart. It can lead to either greater understanding and appreciation or deeper opposition and  avoidance. The challenge most of us have is that unless we’ve learned some conflict management skills, we can fall into unconstructive and reactive ways of communicating that leave us and the other family members frustrated.

Conventional conflict resolution methods are not designed to address the deeper interpersonal and often emotionally charged dimension of conflict between family members. As a result, whatever outcome is achieved through compromise or settlement can still leave family members feeling dissatisfied, hurt or resentful on a relationship level. When this happens, even though the issue causing the conflict may be resolved, on a relationship level of experience, it's still not over. Family members still need to address the underlying relationship issues – the hurt feelings and ignored needs in order to feel satisfied that the conflict has, in fact, been resolved.

More than just the resolution of an issue, when a conflict has become harmful or destructive to  the relationship, reconciliation is needed. Reconciliation is all about restoring "good relations" between family members when conflict has become hurtful. Reconciliation and the restoration of the relationship
require a different type of conversation than conventional mediation. This conversation needs to directly address people's feelings, needs, and the underlying relationship issues that led to the conflict becoming destructive.

There is great benefit to the relationship when people come together to discuss a conflict in a respectful way, explore what's causing it, and realize how it is impacting them. The conversation that happens in reconciliation is often more important than the eventual resolution agreement.

"When family members can address and move through the emotional
and psychological impact of the conflict, their capacity for rational
thinking returns. They become more capable of collaborating to resolve
the issue causing the conflict.” Bledsoe (2016)

In the course of my career as a family business consultant, I have examined many different communication paradigms, procedures, and methods for helping family business members address  conflict, resolve differences, and achieve agreement. I am always looking for the most effective way to  help family businesses communicate through difficult issues and circumstances. Dr. Bledsoe’s focus on the art and science of restorative communication is remarkably compatible with my commitment to "Practice the Art of the Possible."

His method of restorative conflict resolution has proven to be very effective in resolving both the emotional and practical aspects of conflict. This method brings people closer together with a renewed spirit of  understanding, while also achieving resolution of important business matters.