Six Steps to Make Family Business Relationships More Productive

The success of any business depends on productive, healthy relationships within that business. For family businesses, this can be more of a challenge than it is for most other businesses. The relationship dynamics can develop over generations and problems can persist for many years without being resolved.

The following are some of the steps you can take to improve relationships within a family business:

1. Take the Long View

It helps to view relationships within a family business as dynamic and evolving. Challenges can then be viewed as a form of growing pain that need to be managed, rather than as an existential threat.

2. Yes, Relationships are Challenging

It’s a good idea for all family members to be open about the fact that the relationships within any family business can be a challenge. This will make it easier for everyone to raise issues concerning relationships rather than keeping them to themselves. People may not want to ‘rock the boat’, but that can ultimately lead to unresolved problems getting out of control. 

3. Lean Towards Formality

It may be tempting to operate a family business on a more informal basis than one would if it wasn’t a family business. However, sometimes not having or following formal operating practices can create the situations that lead to tension. If that’s the case, it may be worth drawing up more formal operating procedures and policies. These can include record keeping, making sure minutes are kept for meetings and that everyone is aware of who is responsible for what.

4. Encourage Independence

Having non-family members serving as non-executive directors, or in a similar capacity, can provide objectivity and perspective during stressful periods. This is especially important when there are dominant personalities within a family.

5. Be Self Aware

It’s important to be mindful of your own behaviour when it comes to relationships within the business. In this excellent article, Kathy points out several steps we can each take to improve relationships by observing the way we initiate actions and react to others. She also recommends we observe the way each member of the family responds during times of heightened stress. This can help us modify our own behaviour to avoid inflaming sensitive situations.

6. Take Time Out

An annual retreat away from the office will allow issues to be raised that might not be raised during a regular work schedule. Removing some of the stress of the daily grind will make it easier for family members to raise problems they are having. People often keep challenges to themselves at work because they fear bringing them up will inflame the situation.

Retreats are also a good way to celebrate and communicate successes within the business and ensure that everyone knows their efforts are appreciated.

Spending time together in an informal setting also offers the chance to form and strengthens bonds with members of the family we interact with less often. Kathy Wiseman stresses the importance of developing one-to-one relationships with each family member, not just those with whom our thinking aligns.


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