What Makes a Family Business Functional vs Dysfunctional?
As most of you know, I have spent the last 10 years focused on consulting to the intergenerational transfer of businesses, whether in family businesses or public companies. I have had the opportunity to observe first-hand both highly functional families and executive teams and some not so functional.
I will focus here on family businesses rather than companies in the public company domain. The term “dysfunctional family” got me thinking about that word, “dysfunctional”, and how it implies that there is an opposite, functional, family somewhere. What does that look like? Is it a Perfect Family? Some Stepford-like pod of people who never fight, are always neat and smiling? I doubt that. So here’s my list of qualities that make up a family that functions. It’s unscientific, but it’s a good place to start the discussion.
Respect is the Holy Grail of functional families, particularly those who work in constant proximity to one another via a family business. Being considerate of each other is the tie that binds, even more than love. I’ve heard of many atrocities done within families in the name of love but never in the name of respect. In business, this means no back-biting, being respectfully honest with one another, being reliable and maintaining privacy.
An Emotionally Safe Environment.
All members of the family in the business, whether right or wrong, need to feel comfortable that they are permitted to state their opinions, thoughts, wants, dreams, desires and feelings without fear of being slammed, shamed, belittled or dismissed.
Accountability in a family business means trusting that family members can be counted on to do what they say they will do. And, if they can’t live up to a commitment, they let the others in the family know promptly and offer solutions….not excuses. And, if someone fails to fulfil commitments, they have the right to receive feedback.
It’s sad when people hold out for an apology on a point of pride, never acknowledging their part in a dispute. How many times have you heard of rifts in families that last for years because someone feels they are ‘owed an apology’? A functional family business will have conflict. It’s very “cool” when we can have an argument and get to the other side of it still friendly and satisfied with the outcome. But let’s face it, that’s not always the case. Sometimes we say things that we regret. If we can feel and show remorse for our part, quickly apologize, ask for and receive forgiveness, no harm is done. You may even become closer for it.
Allow Reasonable Expression of Emotions.
Being able to state one’s anger, disappointment, sadness, and fear in a managed and controlled manner are crucial to the success of a family business. Equally important is being able to express love, praise, concern, and expectations. Far too often I hear way more of the former than appreciation and commitment to one another’s happiness and success.
Gentle on Teasing and Sarcasm.
Teasing can be OK as long as the teased is in on the joke. The same goes for sarcasm. A functional family business won’t use either as a poorly masked put down.
Allows People to Change and Grow.
It used to be that family members were labelled the smart one or the pretty one, the funny one, the nutty one or the shy one. A functional family lets people define themselves. Individual differences are appreciated even celebrated. Besides, most labels are mislabeled anyway.
Courtesy at Home First.
An ounce of a well-placed ‘please’ or ‘thank you’, ‘you’re welcome’ or ‘I’m sorry’ is worth a pound of explanations, defensive arguments and misunderstandings. We more often than not dress up to go out than dress up to go home. Treat family members in the same manner as you do customers or co-workers.
Provides Clear Boundaries.
Children are not extensions of parents. They may or may not have the same skills and abilities as the parents. Parents ought not set expectations for their children which are way beyond reach or reason, or the way they would do things, thereby causing a serious loss in self-esteem or a sense of failure. What got the business to “here” may not get it to “there”. Parents in businesses need to act as coaches and mentors, not instructors or judgers.
Has Each Others’ Backs.
Being supportive to each other no matter what is equally essential between business partners and family members in the business. It’s the essence of trust. Don’t let yourself be party to criticism about family members; direct that individual to the one who needs to hear it. Avoid gossip….it’s deadly and pernicious.
Get Each Other’s Sense of Humor.
Functional families and family businesses laugh a lot. They have ‘inside’ jokes and favourite stories, anecdotes of memories shared that delight and re-enforces a healthy bond. Remember to laugh. Follow The Golden Rule. It’s golden for a reason. “Treat each other as we wish to be treated in turn.” It was true way back when and it’s still true now. Dr. Gerald (Gerry) Pulvermacher, Ph.D., C. Psych
Dr. Gerald (Gerry) Pulvermacher, Ph.D., C. Psych. Gerry obtained his Doctorate in Clinical Psychology and practiced full-time from 1972- 1978. Following post-doctoral training in Industrial/Organizational Psychology in the late 1970’s, Gerry co-founded PSS, a consulting firm devoted to management consulting, training and organization development. In addition, he was Managing Partner of Pulvermacher, Stevens & Shack (Clinical Psychology) and Partner in MICA, McQuaig, Pulvermacher. When Deloitte Consulting acquired PSS, Gerry was asked to lead the Change Leadership, Organization Performance, Executive Development, Learning and Human Capital Service Lines on behalf of Deloitte Consulting, globally. Gerry left Deloitte Consulting in 2005 and co-developed PulvermacherFirth, a firm focused exclusively on Executive Talent Management. PulvermacherFirth was acquired by the Hudson Highland Group (a subsidiary of monster.com) in 2006. Gerry has been independent practice since 2006, specializing in intergenerational transfer of businesses, business transformation, strategic planning and executive coaching/development.