How to Settle Family Business Disputes

Never mind how many years or even generations itcircumstances, any of those approaches may seem
has taken to create a family business and to make itto work.
successful. Internal conflicts can shatter a familyWhether the real problem gets resolved is a different
business more than all competitors combined. Instory. Conflict in a family business is often more
today's world a business is not likely to be around forcomplex and deeper than it looks. It could be that,
long when family members spend more time fightingbefore any issue around money or shares can be
and blaming each other than working together andresolved, some other issues - of a totally different
coming out with fresh and creative ideas.nature - need to be resolved first, like the family
One typical reason why family members fight is theirmembers' difficulty in listening to and understanding
limited resources. In any business there are obviouslyeach other.
only so many dollars, shares, and top managementIt is a big step forward when family members can at
positions available. It is not easy to please all familyleast agree that continuing to fight against each other
members when each of them strongly believes to bedoes not resolve their business problem. Instead, it
the one who deserves that CEO job, those dollars, orwould be far more productive to ask the help of a
those shares. Another typical reason for conflict isprofessional business mediator, experienced in conflict
change. Some family members believe that change isresolution.
necessary, arguing that the business will never improveAs neutral third party, the mediator does not tell family
without it. Others keep finding plausible reasons tomembers "what" to do, but "how" they can best
resist it. If their family business is doing fine, there is nodecide what to do. During joint and private meetings
need for it; if it is doing poorly, there is no time orwith all family members and other professionals whom
money for it.they trust (attorneys, accountants, management
It looks like the real challenge for a family business isconsultants), the mediator applies several problem
not how to avoid conflict - since that is almostsolving strategies and techniques.
impossible - but how to deal with it, and how to resolveWith the mediator's help, the family members start by
it constructively.defining their problem in a way that everyone
The way family members deal with conflict muchunderstands and agrees on. Their next step is to
depends on their individual personalities. Some have acome up with as many options as possible to resolve
"my-way-or-the-highway" approach; others prefer tothe problem. Finally, they negotiate with each other,
compromise; and some try to deny that any problemwith the mediator's impartial assistance, until they agree
exists, hoping that time and patience will eventuallyon a solution that they are all willing to accept and
take care of everything. Depending on themake work.