Family Business Communication Insights: Honest Conversations for Effective TransitionsBondBeebe
Posting by Geoffrey D. Brown, CPA
Last week, I had the pleasure of moderating a webinar with David Gage, Ph.D. of BMC Associates where we discussed communication and its role in family business transitions. Ineffective communication can plague any company, but it can be a particularly difficult issue for family businesses dealing with emotionally-charged relationships and decisions around succession and estate planning.
David is a mediator and clinical psychologist who works with family businesses across the country to help them resolve conflicts. Together, he and I explored several issues around how family businesses can initiate honest conversations and how they can create a culture that fosters these honest dialogues in order to achieve business goals.
I would encourage you to download the webinar video for David’s full insights; he shared several case studies, as well as a number of principles and tactics family-owned enterprises can utilize when trying to resolve transition issues and other tough business challenges. Here are a few of the high-level action points that he shared:
Discern the Underlying Values. Many conflicts begin or escalate based on fundamental differences in family members’ values. Taking a few steps back to uncover the different values and assumptions held by each person can help you understand the root of the conflict and pursue targeted strategies for diffusion.
Stop the “Spiral of Conflict.” David shared a helpful graphic that shows how conversations can grow from tense to hostile. One person’s look or tone can be perceived as malicious, triggering negative emotions and a counter-attack. This process repeats until the conflict reaches a boiling point.
Using “I” statements (I feel insulted as opposed to You insulted me) can help diffuse tension in these situations. Also, understanding the role that perceptions and emotional reactions play in the process will allow you to slow, if not stop, the spiral from escalating to hostility.
Communicate and Ask About Interests. There are a lot of dynamics at play in a transition situation – power, rights, and interests. When looking to transition leadership, start with a conversation about interests – your own and your potential successor’s (or successors’!). This will help you come to a conclusion that is best for your business and for your family. And, you may be surprised at how much these interests overlap.
Note that while interests are often related to values, it’s important to talk about both with your family, as people’s actions/interests sometimes give you the clearest view of their true values.
Successful communication is for many people a learned skill, and one that can greatly impact the success of your family business. By taking steps to ensure open, honest conversation and structuring interactions to help diffuse inevitable conflicts, you can promote healthy, successful business outcomes for your business and your family.