Peacemaking

 

May 23, 2002

July 18, 2002


When the family business is in dispute, use the right tool

Consider these scenarios:

"Dad, can I have the car tonight?"

"No. Remember the last time you drove it, you left the tank empty."

"But Dad..."

"No buts. When you show some responsibility, you can borrow the car."

The teenager storms out of the house, slamming the door as she goes.


"Dad, I think we should invest in the new production line."

"No. I don't want to put any more capital into the company."

"But Dad, we can't meet customer demands as it is. How do you expect us to grow if we don't expand?"

"No buts. As long as I m running the company, I say how things will be."

The 41 year old MBA graduate daughter, furious, stalks out of her father's office.

Conflict in all families is both normal and inevitable. As family members move through life, their needs, interests and expectations change. Consequently, there is plenty to dispute. Conflict in business families is even more expected and inevitable.

More significantly, the stakes are higher because the wealth of the family is often based on the business. Furthermore, the business has employees, customers and vendors, and is a valuable taxpayer in the community. The fate of all of these stakeholders could hang in the balance as family members engage in internecine warfare.

How families handle conflict thus becomes a matter of great importance. In a recent issue of Conciliation Quarterly, Henry Landes provided an interesting analogy to describe the differences between family and family business conflicts. Most normal families can handle their conflicts with basic conflict-solving tools. Simple respect, listening and remaining open to new ideas are effective tools. Landes calls this the wheelbarrow model of conflict resolution. Like a wheel barrow , these tools are simple, easy to use, light weight and user-friendly. When used correctly, the wheelbarrow can make the conflict resolution jobs around the house much easier.

Landes points out that business families need more sophisticated conflict-solving mechanisms. He calls these mechanisms the pickup truck model of conflict resolution.

Family business conflicts require more capacity to handle the complexity of business issues that are overlaid onto relationship issues. Thus, the truck bed must be large enough to carry all of the extra baggage. Four wheels are needed, instead of one, to provide stability for the heavier load. Shock absorbers (forgiveness and humor) are necessary to smooth out the difficult parts of the conflict road. Good tires (emotional elasticity) are essential to deal with the bad weather and rough roads presented in conflicts. Finally, to drive a truck requires an owner's manual (rules for dealing with family business conflicts), driver education (training), and a license to drive (competency). Experience helps too.

Trouble arises when family business members try to use a wheelbarrow when a truck is required. What worked when Jill was 16 probably will not work when she is 35. More trouble arises when family business members become adept at pretending that conflicts do not exist. The conflicts in these families become taboo such that implicit agreements arise to ignore them. The conflict taboo often leads to one or more family members leaving the business with bitterness on all sides.

Family business members looking to upgrade from a wheelbarrow to a truck should ask the usual buyer questions: How big a truck do we need? Will a half-ton pick up do or do we need a double-wheeled, tricked out four wheel drive posi-traction two and half ton (with chrome and running lights). In other words, how extensive should our skill sets be? Do we buy or do we rent?

In other words, should we bring in a peacemaker to help us haul some heavy loads? Are we willing to invest in high quality shock absorbers so that we can have some fun and be willing to forgive? Will our tires be cheap and likely to blow out or more expensive and therefore durable?

How much flexibility are we willing to invest into each other? What kind of an owner's manual do we need? What rules and agreements do we need so that conflicts can be handled effectively? What kind of driver training do we need? Do we bring in coaches, read books, or go back to school to learn new skills. Finally, will we be driving our truck around the farm or on the highway? The highway will require a driver's license and significantly more competency. If we think our conflicts will be complicated, perhaps a driver's license is a good idea.

Wheelbarrow or pickup truck? As carpenters say, use the right tool for the right job.


 

May 23, 2002

July 18, 2002