Sibling rivalry in family business

(Last of two parts)

Behavioral research has shown that emotion-based sibling rivalry is the struggle to gain attention and love from parents that were missing during childhood.

The adult child’s actions and behaviors are directed toward gaining approval and recognition from his or her parent. This need may continue psychologically even after the death of the parent.

Because emotion-driven sibling rivalry is rooted in problems of self-esteem, the primary solution must be built on methods that encourage the adult development and individual maturity of each of the siblings.

The real problem lies between the parent and child, not between the siblings.

Consequently, the solution is not working with the sibling relationship, but with the relationship between the adult-child and the parent.

The second type of sibling rivalry is rooted in conflict over business styles and strategies rather than family emotions. While emotion-based rivalry is really about the child and the parent, strategy-based rivalry is really about the siblings. Frequently, such strategic conflict is driven by differences in personality concerning levels of financial risk. Strategic conflict among siblings has a very different emotional content than the rivalry for parental attention.

Solutions to strategic rivalry are difficult, but require business solutions, rather than psychological growth. Siblings need to develop their strategic planning, carry out good financial analysis and explore alternative methods for ownership as business partners.

Businesses are often defeated by competitors when siblings battle emotionally against one another using the weapons of business strategy. When sibling conflict creates tensions within your family and business environment, make sure you first define the real underlying problem: Is the core of the rivalry emotional or strategic? Then take the proper course of action consistent with the real issues.

If family partners in the business have achieved their own emotional maturity and are no longer dependent on parental approval to feel good about themselves, then strategic business alternatives and conflicts are much easier to resolve.

Facilitated business meetings among sibling teams or cousin consortia is critical for finding a workable solution.

The development of a Family Forum, usually with the assistance of an expert in healthy family process and conflict-resolution, remains the most practical way to develop family agreement around succession planning, hiring standards for family members, stock distribution and other hot topics.

Dealing directly with these issues in advance in an organized forum remains the best insurance policy against sibling or cousin rivalry disrupting the family firm.

Another sensible recommendation for siblings who are in business together is to not work in the same functional area. The classic case study for this is the massive fallout between the two sons of the billion-dollar Reliance Industries, who both had undergraduate technical degrees and MBAs from top business schools. The extent of their disagreements was such that the business had to be divided in half.

Other methods include having siblings not report to a parent. This divorces the emotional aspect of the business relationship.

However, it also requires a strong and empowered manager to effectively manage the owner’s children.

If siblings, especially those who need to make consistently good decisions together in the family business, can redefine their adult relationships based on the current realities, the adult bond between siblings can truly become profound.

They will rediscover that they share not only bloodlines and a stake in the family business, but a lifetime of irreplaceable experiences.

(Prof. Soriano is the chair of the marketing cluster of the Ateneo Graduate School of Business. He is also a family business coach and author. For comments, send e-mail at [email protected])