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Management, Family Strains And Personality Clashes. What Should I Do?

Full Question:

Dear Harry,
This is a very difficult letter to write. I have two sons, and a married daughter. Both boys are in the business with me – we run a mechanical engineering company that my younger brother and I took over from my father. My youngest son has studied mechanical engineering and is clearly building up to be a real asset to the business. He is sharp, hard working and easy to get along with. My eldest son did business studies, and sees himself taking over from me, but he is not popular with the older members of staff. He and his brother seem to get along well enough, but probably more to do with the easy going nature of the youngest.My brother has three boys – all at university. At least one of his sons may join us – but that’s not yet decided. My brother and my eldest son don’t see eye to eye. It’s getting to the point where we no longer have family gatherings – even my daughter’s wedding was a strain.I can see issues arising and up until now, I have been putting it off. I find this hard to even articulate my concerns – what would you do?
Answer - On the rules of the game Harry says:
You’ve highlighted a range of issues that are obviously causing you deep concern. We often use the analogy of the family business being like an iceberg, only 10% of it is visible above the surface, but the bulk of it is out of sight below the surface. You’ve certainly started to delve into some of the fundamental issues.
The questions you’ve raised are common to many families in business and arise because ‘family’ and ‘business’ are structured around completely different values systems.
Family values centre around love, support and the nurturing of members inside the family group. Business is an outcomes driven activity that focuses on results, performance and competition. When we bring these together inside a family business there is often a lack of clear definition between the family and the business systems and the resulting overlap creates confusion, uncertainty and the potential for conflict.
It appears that the time has come for your family to meet and think about whether your values are more attuned to the world of business or family. Then through a consultative process, these values would flow through to a series of decisions in relation to how the family and the business interact. I call this establishing the ‘rules of the family business game’.
Let me give you an example, in relation to one of the issues you have raised – the future leadership of your business. If your family values are heavily weighted toward the ‘business’ end of the spectrum, your decision will be based on what is right for the business. In selecting a successor you will ask questions such as – what skills are required to lead the business into the future, which candidate has demonstrated performance in the past, how will the appointment be received by other stakeholders, your employees, customers and suppliers.
If on the other hand you are driven by family values, and one of the traditions in your family is that inheritance passes to the eldest son, (the royal family solution) then your decisions will be determined within that framework.
In either case if your family has gone through the process of deciding the rules it operates under, decision making is much easier. Further as all family members are aware of the ‘rules of the family business game’ they can decide whether they want to participate.
The key is giving some thought to the framework before the issue becomes personalised.Working through these can be a complex and emotional process and you may find it helpful to have outside support.
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