By Timothy G. Habbershon I often get calls from family businesses that are in crisis. A father tells me his two sons are threatening to start a competitive business; a company president says she doesn't know how to tell her vice-president brother that his work habits are hurting the company; three siblings are fighting over equity in a startup. And so on. These struggling family businesses generally think they have transition or strategy issues.
But those are just symptoms of a bigger problem: lack of relationship capital.
Every business owner knows the importance of having adequate financial capital. Few understand the often overlooked, but essential traits that allow people to communicate effectively: trust, loyalty, goodwill, benefit of the doubt, safety, and honesty. Without these, you can't talk about tough issues in a nondestructive way.
Relationship dynamics and histories -- what I call sandbox memories -- often make communication very difficult for family businesses. Before you can operate your company efficiently and tackle the thorny issues at hand, you need to master the art of effective communication with other members of the family. Start with these eight steps.
1. Establish the rules of the game. Families should create a communication code of conduct so that all members play by the same rules.
2. Stop thinking about communication as a tool for getting people to agree with you. The goal isn't agreement, but understanding. Strive to understand the perspective of others, and you'll go from being a strong-armed leader to a good communicator and decision-maker.
3. Ask more questions. This one change in tactics will build understanding and improve communications. Of course, it's tough to keep on asking questions when someone disagrees with you, but that's how you go about gaining understanding.
4. Realize that giving people a voice doesn't always mean giving them a vote. Many leaders fail to elicit opinions because they fear this would give away their power. That's particularly common when parents and children work together. But our research shows that when people are given a voice, they are much more likely to support a final decision -- even if they don't agree with it.
5. Let others know your weaknesses and let them coach you. When one leader told his team that he recognized he had a temper, it allowed them to talk about it openly. Afterward, his salespeople no longer avoided speaking to him.
6. Don't make everything about right and wrong. When you communicate in absolute terms, you don't give other people room to have an opinion. You force them to agree with you, fight with you, or ignore you. Don't confuse strong opinions with strong leadership.
7. Cultivate positive feelings about others. If you dwell on negative thoughts, even when justified, they'll affect both what you say and how you say it. Communicate positively, and you'll promote positive change.
8. Address hard issues head-on. When the sister who had called me about her brother finally talked to him about his work ethic, he improved his habits. And the tension between them began to evaporate. That's the kind of relationship capital they can draw on to improve their business, and their families, in the future.
Timothy G. Habbershon is director of the Institute for Family Enterprising at the Arthur M. Blank Center for Entrepreneurship, Babson College