3 Tips For Preventing And Resolving Conflicts In A Family Business

Working with family can be great-- you have the opportunity to build your company with people who you love, and you can all share in the success together. But there is also a downside to family businesses-- when there are problems or conflicts personal relationships can become strained or awkward, and feelings can get hurt. Use the following tips to prevent and help resolve issues with your family members who are working with you in the family business: 

Don't Forget that You're Running a Business

When you have a family business, it is important to run it as a professional company. If you plan to start a new business with a family member, it is a good idea to get everything in writing, such as how much each person invested and what the job responsibilities will be. In an established family business, make it understood that when your family members are on the clock they are employees and must fulfill their job responsibilities just like they would have to do at any other place of employment.  

Make Promotions Based on Merit

When you have several family members working with you at your family business, it can be difficult to give promotions without hurting feelings as your company grows. One way to avoid personal conflicts with family members in regards to promotions is to base promotions on merit and accomplishments on the job. If you have employees who are not a part of your family, don't be afraid to promote them if they have proven that they are the best person for the new position.

Consider Family Business Mediation for Serious Issues

There are situations where conflicts and problems cannot be easily solved with discussions and conversations. This can be especially true when a family business is an equal partnership between two family members, and other family members, such as the controlling partners adult children, are also employed by the company. The last thing you want is to cause a permanent rift in personal family dynamics by filing a lawsuit against your business partner and family member. Instead, consider family business mediation.

During a family business mediation session, a trained outside party, typically an attorney or business consultant, will assist family members and business partners in calmly discussing a conflict and working together to find a solution that benefits the company as well as family relationships. Mediation is different than arbitration, as a settlement is not mandated, but it can be very effective in solving big problems that a family business may face.