In a family business, the founder shapes the culture of the organization and the relationships between family members.  The first hurdle to smooth teamwork in a family business is the absence of trust. Family members are unwilling to be vulnerable. They don’t openly share their mistakes, weaknesses, and concerns. Nobody owns up to errors of judgment and the culture of passing the buck sets in. They don’t ask for help in difficult situations. Everyone passes quick judgments about others without trying to see what the real issue is and no one steps outside his assigned area of responsibility to offer help.

The second hurdle is the fear of conflict. Based on past experience everyone is guarded and diplomatic. Because people take offense easily, family members avoid important but controversial subjects because they may lead to conflict. There is no open discussion because family members don’t express what they really think. People choose their words carefully and keep meetings short. There is no culture of “ whiteboard brainstorming ” so decision-making is flawed even though there is wisdom in the room to arrive at a good decision. Meetings become a necessary formality and dull because the real issues don’t get debated in a spirit of open collaboration.

The third hurdle is a consequence of the first 2 hurdles – because there is no trust and no open discussion due to fear of conflict there is no clarity and “buy-in” for important decisions. There is no ownership for strategic decisions. At the first signs of a problem in implementation, a typical mindset emerges – “ I knew all along this problem will crop up. If only dad had asked for our opinion on this. “ This is a crippling problem many family businesses grapple with.

Only a founder with maturity, humility, and foresight, one who has a mindset of building an institution – not just a business –  can build a culture of trust in a family business. But the skills required to build a business are different from the skills required to build an open transparent culture and manage the aspirations of a consortium of relatives. Understanding these 3 hurdles is the first step to finding a solution. Building a culture where everyone is empowered, motivated, and free to express his opinion, and all strategic matters are passionately brainstormed is squarely the responsibility of the founder.

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Harsh Chopra

Family Business Advisor