5 tips for maintaining trust in your family business
by Graham Andrewartha
Trust is important in any workplace. But the importance of trust in a family business is in a league of its own.
When trust breaks down in a family business – both between family members and non-family members – the business becomes at immediate risk of breaking. Not to mention the collateral personal damage that ripples out far beyond the business’ books.
Family businesses account for around 70% businesses in Australia. As a family business ourselves who have also specialised in helping many different family businesses work better together, over the years we have observed that there are 5 fundamentals for maintaining trust in a family business:
1. Be clear and open about the status of different family members within the business. Not all family members will have an equal role or, from a business perspective, be of equal importance or influence. Being open and clear about status and implied importance across generations and gender can make collaboration work.
2. Maintain a shared sense of certainty (and uncertainty). Certainty is about how well we are able to predict the future. Which family member’s future is more certain? Whose strategy is more likely to produce business growth? Explicitly defining and planning certainty and measuring risk objectively in a family business is crucial.
3. Be clear about who has control and over what. Does each family member have sufficient autonomy? Do they believe that? How is autonomy balanced against risk management? Working carefully to enable all family members to identify the control they have is essential to good problem solving and maintaining trust.
4. Be comfortable with differences of opinion and disagreement. In each important conversation how safe do I feel with my family member? How do I extend a sense of safety when we are in disagreement? Showing respect and support for fellow family members (and non-family members) and keeping away from judging and labels really works.
5. Ensure a consistent sense of fairness. This is a perception of fair exchanges between family members. Did you break an old agreement we had? Why did you give that project to my sibling instead of me? Why are you taking so long to hand over the reins? Fairness is not equal treatment but fair dealings. Always in the eye of the beholder and so understanding the other’s perspective is key.
When any of these five areas are compromised we experience a sense of threat and a breakdown of trust. When maintained for in a family business then trust and effective outcomes result.
If you are keen to maximise trusting and successful relationships in your family business, please call us on 1300 856 480 or email me at firstname.lastname@example.org.