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In Business, Trust Will Set You Free

By Paul Karofsky People often seek working relationships with family members because they believe they can trust one another. While trust is usually expected -- and even assumed -- in most family relationships, it's also frequently broken or lost. And, in some cases, it never exists at all.

I'm not thinking of issues around honesty, though that's certainly of concern for some. In this case, trust refers more to worries about dependability, or being able to count on another family member's judgment as sound.

WHO RUNS THE SHOW? I've worked with Robert for several years. He spends his winters in Palm Springs, Calif., while Robert Jr. (RJ) runs their pet-supply distributorship in Chicago. Robert has been trying to gradually phase out his involvement in the business and has increasingly transferred responsibility to his son. RJ claims his dad is semiretired. "Some days, he's retired," RJ says, "and some days he isn't."

Frequently, when dad is informed of RJ's decisions, he questions them, challenges them, and, on occasion, even reverses them -- not only causing significant tension between father and son, but also setting the organization up for confusion. Who is running the business? Is it RJ at the office in Chicago? Or Robert on vacation from Palm Springs?

RJ feels that his father doesn't trust him, but he also doesn't trust his father. As a colleague and I explored one specific example of this dynamic, it became clear that Robert feels excluded from the decision-making process in many of the very areas where he has empowered his son. This leads him to second-guess RJ's decisions, which the son then perceives as a lack of trust.

HAREBRAINED? In working with father and son, we helped make them aware of this pattern -- and how to counter it. RJ realizes that while his dad delegated decision-making responsibility to him, he still wants, on occasion, to be consulted and asked for advice. As we suggested to RJ, keeping his father informed about key impending decisions and the considered alternatives, plus achieving clarity on who the true decision-maker is on each issue, will lead to trust on both sides.

But such trust issues are not limited to territory and responsibility. Sally, a sales representative in business with her brother, is very creative but can be unpredictable. Her work hours are erratic, her billing is usually late, and her office a total disaster, with papers and files scattered everywhere. Her brother calls her a "space shot," never quite knowing what she'll say or do.

In one meeting with a major customer, she presented a new marketing concept that seemed so far off the wall, her brother tore it apart. The customer, however, was actually intrigued, and after some fine-tuning, bought the idea, which led to one of the largest and most profitable sales in the company's history.

UNLIKELY TEAMS. Her brother was not only amazed but learned to form a different view of his sister. In a subsequent discussion I had with the two siblings, Sally agreed to keep her brother informed -- in advance -- and to present him with the potential negative consequences of her suggestions to help obviate his concerns.

Close to 30 years ago, when transactional analysis (the area of social psychology developed by psychiatrist Eric Berne) was "hot," I was working on coalescing the management team in my own family's business. So I planned a TA retreat, complete with flip charts for "warm fuzzies."

When I shared my intent with my business partner, who also happened to be my dad, he was quite suspicious and thought I was a bit off the wall. Nonetheless, he agreed to participate. He gave me a chance, an opportunity to proceed with a team-building process that was designed to build closer working relationships through positive feedback.

Off we went to the Swiss Hutte in Hillsdale, N.Y., the perfect site for a retreat. We took over the entire complex and divided into a mix of rather unlikely teams (sales, customer service, warehousing, information systems, and accounting) and did a bridge-building exercise. These teams of men and women had conflicted and, in some cases, even contentious, business relationships. Yet, here they were working together with a common goal.

TAKING CHANCES. This was followed by each individual donning a flip chart on which other team members wrote comments on what they valued from other people's contribution to the team. The positive feedback was empowering.

As individuals viewed their own charts, they had to guess which team member offered which comment. When they learned of the authors, some were quite surprised to get such supportive feedback from people they didn't expect. The event built stronger relationships among our team members. My dad was an instant convert. He'd taken a chance and trusted me -- with positive results.

While clear boundaries and sometimes including others in decision-making can help develop trust, often it involves simply taking chances, having faith, and assuming the best instead of the worst. In a family enterprise, a solid sense of trust is one of the basic strongholds that allows members to work together -- and succeed. Paul Karofsky is executive director emeritus of Northeastern University's Center for Family Business, and a member of the Family Firm Institute. A former third-generation family-business owner, he's currently the principal of Transition Consulting Group in Boston, where he advises families, businesses, and educational organizations.

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