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Consulting to Family Business: Therapist or Advisor?

CMC Communicator, published by The Institute Of Certified Management Consultants – March 1995, Volume 9, Number 3

Consulting with a family firm differs from consulting with a non-family firm. There are three reasons the family firm consulting experience is different.

Number one is the obvious: family dynamics, emotions and conflict seem to contaminate the business environment. The second reason is that family firm consulting is more personal than other consulting. Working with families brings all the skeletons out of the closet (read: your skeletons and the client's) and consultants need to be able to deal with these issues in a non-judgemental way. In some instances, the consultant ends up as a surrogate family member as transference occurs. The third reason relates to the balance between family and business concerns. This area includes such issues as the presence of family members in operating positions for which they are not qualified, the influence of family members who are not in an operating or ownership position, intergenerational goal ambiguity and conflicting roles.

Families in business together are often struggling with issues such as: Dad won't retire; my sister is underpaid; a key manager wants voting stock; my brother and I can't agree and Mom's tired of being the referee. Many family business owners know all this, yet they do nothing. They also know that running a successful family business is more than maximizing profits. Achieving harmony among family members often becomes more important in the long run.

Conflict in the family business continues to be one of the most important issues family members need to address. Sabotage and covert alliances are often the chosen methods of retaliation for the powerless as they grapple with the perceived lack of trust that each family member has for the other. Family members in business together come to the "office" with numerous unspoken expectations around how things will unfold at work. If only minimal planning and discussion occurs prior to a family member's entry into the business, their inability to talk about their relationship to the business and to each other, and their career in the business, can lead to confusion and interpretation. When expectations remain silent and are not met, the perceived injustices can leave family members feeling boxed in, resentful, unacknowledged, confused, out of control and lost between the family emotional system and the business rational system.

As a consultant to family businesses confronted with these types of issues, are you a therapist or a business advisor? Are there any clear boundaries? The answer is: rarely.

The challenge to working successfully as a consultant in the family business is often dealing with the human side, in the twilight zone areas, where the boundaries between the family and the business get confused, where role ambiguity is high, self esteem is low (and confidence too!) and inter-generational mutual respect is only a distant concept. By working to improve these dimensions, the family business client becomes aware and powerful, and thereby able to make knowledge-based decisions about continuity and wealth planning as well as understand the meta-messages between the family participants.

When you consider the complexity of the consulting process, it is not surprising that there is a delicate balance between what is considered a successful family firm consulting experience and what is not. In training consultants in this field, I have found that the number one mistake is an inability and/or reluctance to understand and appreciate the power of family dynamics. Other mistakes include: focusing on symptoms rather than problems; being unaware of personal consulting limitations; acting out one's own autobiography; and communicating inappropriately with family members.

In addition, the family business owner requires a more eclectic consultant, thereby making those niched in a single discipline less likely to succeed. For example, approaching business problems from a strictly legal, insurance or financial perspective risks failure because family dynamics as well as family interests play a vital role in the success of the business. The reverse is also true. Any behavioural specialist who ignores the business aspects will likely create an harmonious family who might go broke, albeit happy. Therefore, there is a great benefit for the business consultant to develop one's therapy knowledge if one is to assist in an ever lasting change that actually deals directly with the behavioural issues and for those niched in the human side of the business to get an adequate understanding of business principles and methods of business operation.

Another highly effective approach, which I prefer, is to perform team consulting. While this multi-disciplinary consulting approach is not for every consultant or for every client, in many instances, the needs of the client family and business have successfully been met utilizing this approach.

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