At the end of a year long consultation with a family business, an heir expressed, “Isn’t it ironic our family had to be more business-like, and our business more like a family? What I mean is, our family had to organize and our business had to build trust.”
The unique challenge of a family business is to create clear relationships on the job and at home. How does a son come home and vent about his boss, when the boss is his wife’s father? How do two brothers stay out of conflict since old memories of childhood lurk in every transaction? The essential tool is agreements. Thorough agreements.
Family business/home agreements require three major elements: negotiation, compromise and sacrifice. These are familiar terms and concepts. But they are often misunderstood, or thinly applied. Check back in paragraph number one. The essential tool is THOROUGH agreements. What is often missed in negotiation? Why does compromise feel like a loss? Doesn’t the thought of sacrifice bring up resistance?
The first step in negotiation is to agree to have a conversation. This asserts you and the other are willing to acknowledge a conflict, disagreement, or “we see things differently.” This beginning step is crucial, for it is an act of mutual respect, and expresses trust exists.
Many families can’t get to square one due to injured relations from the past. Some families have “don’t go there,” or taboo topics. These areas indicate vulnerability. Paradoxically, vulnerability is imperative in creating family agreements. I advise families to start conversations where they feel safest. As trust builds, the relationship becomes solid, opening the possibility for deeper conversations.
Negotiation takes courage, effort and risk. Simply begin with an “invitation” to talk about a problem/challenge that exists in the relationship.
Once a dialogue is begun, it is important to validate each others perspective, even if you don’t agree. Validation does not mean you give up your position, it means even though you see things differently, you respect the others perspective. Therefore, validation nurtures the safety of the conversation, allowing for deeper exploration. “Right” or “wrong” positioning reflect a power struggle, which is about lack of trust. Validation nullifies power struggles.
After a time of having both sides of the perspective/story heard and validated, negotiation moves to compromise. To compromise is to “give” a little, loosen up and be flexible. Compromise comes about because of successful negotiation. Therefore, both parties are “conceding,” to the truth. What is true is the ultimate goal.
When we arrive at the truth, there may or may not be a need to sacrifice. If the need exists, both parties need to be in agreement with themselves (individually) what they are willing to give up. Sacrifice carries the cost of serving the family as opposed to individual. Therefore, when sacrifice is necessary, it is an investment in the family. If the one who sacrifices is not in agreement with themselves, they will resent their sacrifice. If they are in agreement with themselves, their sacrifice is a gift to the relationship/family.
The outcome of a conflict well traversed, is often transformative and innovative. Family agreements create and maintain family harmony.
