Soriano: Whose fault is it when siblings fight in the business?

·3 min read

In today’s article, we will dwell into “strategy-based rivalry” or more appropriately “work-based conflict” among adult children. In my years of mediating conflicts among family members, almost 60 percent of our intervention happens to be sibling rivalry, especially among offspring that work together. And the numbers are increasing at an alarming rate. Leading family business advisor, Dean Fowler identified this second type of sibling conflict as “rooted in conflict over business styles and strategies rather than family emotions.” While the first one (emotion-based rivalry) is really about the child and the parent, strategy-based rivalry is really about the siblings, where too often such conflict is driven by differences in leadership style, personality and maturity levels in the areas of managing risk related to money, growth and expansion.

For enterprises based in Asia, the concept of primogeniture (the state of being firstborn) plays out in many sibling conflicts, where the eldest sibling expects to be able to boss his younger siblings. This can lead to serious resentment and possibly a plethora of emotional issues dating back to the time the siblings were still young.

Work-based conflict among siblings has a very different emotional content than the rivalry for parental attention. But what complicates the business side is the set of personal issues rolled into the business system. Whatever roles and habits were present during childhood are likely to return once they are in high-pressure situations together. Or if the rivalry that defined the offspring’s childhood threatens his or her ability to collaborate, it can also destroy and disrupt business operations.

Nobody to blame except the neglectful parent/owner

When this type of conflict is not addressed, it can disrupt many important decisions. At worst, many logical decisions that are critical in helping fuel the growth of the business will be set aside all for the sake of temporary peace among the warring parties. Without clear rules and structures on how to address these issues, clash points will always emerge when another controversial decision is raised for decision-making. Unless this constant fight for shareholder power is addressed during the lifetime of the parent-owner, the business rivalry can escalate into ownership conflict immediately after the founder is gone. Legal ownership is a dangerous battleground for emotionally charged siblings. With a complicated and tangled ownership process, equal share ownership and the lack of institutionalized mechanisms for conflict resolution (no thanks to the deceased and derelict parent/founder) what can we expect of this volatile sibling relationship? A troubled and warring family stuck in an emotional quicksand, unyielding and uncompromising even as the business deteriorates due to internal strife.

Businesses are often defeated by competitors when siblings battle emotionally against one another using the weapons of business strategy. Everybody will end up as losers in the aftermath of a bruising encounter and family members should expect the business to degenerate all the way to oblivion.

Learnings

When sibling conflict creates tensions within the family and the bigger business environment, make sure the family and the consultant first define the real underlying problem: Is the core of the rivalry emotional or strategic?

A consultant initiating intervention amid the ongoing sibling skirmishes that ratcheted up for many years can be quite challenging. In our experience handling similar issues, we would usually come up with a plan to diffuse old wounds exacerbated with new tensions by immediately proposing to the family the creation of a family council. Facilitated business meetings among sibling teams (or cousins) is critical for finding a workable solution. The council is usually done with the assistance of an expert in healthy family process and conflict-resolution.

The key is to inject objectivity in an environment wrack with biases and finger pointing. With no parent founder (deceased or incapacitated) to troubleshoot the impasse, the role of the appointed family consultant to mediate and lead the family to harmony becomes pivotal and significant.