Effective Conflict Resolution: Strategies for Making Tough Decisions While Maintaining Family Unity

Posted by Maria Villax on 28th June 2024

We’ve all heard of family feuds, of very public disputes that end up in court and in the papers, and of entire generations that have stopped speaking to each other. But we also know that the only clear winners in these situations are lawyers.

Family rows and the breakdown of relationships are some of the most feared challenges by families, but the existence of different points of view, different agendas and different priorities is inevitable. It’s in the nature of family ownership, the flipside of all the benefits it brings.

In this article I share considerations that can be taken to prevent this scenario from happening and mechanisms that families can use for conflict resolution.

Reducing the opportunity for Conflict

Think ahead

The first consideration is that the best time to create a process to manage tension and conflict is while relationships are healthy. If circumstances have already soured, it becomes very difficult for family members to sit down and agree on how to tackle the problem. And there are several ways to deal with it, each solution depending on a very specific step-by-step process (the one that should be clearly agreed on before a fight erupts). The key point is to create a framework for dealing with the conflict ahead of the event.

Disagreement is natural and should be expected

The second consideration is that it is not a question of if but a question of when family members will struggle to agree on a point. It is normal and expected that family members will have different views. Now, it’s also important to point out that most of the conflict I’ve witnessed in families has not been between two points of view, one right and one wrong, but about conflicting priorities, both equally relevant and worthy of consideration. If one sibling wants to sell the business while the other wants to transfer the ownership to their children, who is to say one is right and the other one is wrong? In these cases, the best decision will be taken after a considerate and thoughtful analysis of what is to be lost and what is to be gained, and a compromise arising from that exercise. When the question is between two opposite sides of the spectrum, the best decision will leave neither one happy nor angry.

When the damage is too advanced

Granted, there are also cases where the conflict stems from long-standing grudges or trough perceived bad behaviour: family members being bullies, treating others unfairly, abusing their power or influence, or being downright unpleasant in how they deal with others. In these cases, it requires a significant amount of self-awareness to acknowledge the problem – something that is very rare in the person (or people) displaying the bad behaviour, typically because they may lack the emotional intelligence necessary to that level of self-awareness. If the family stands to lose everything, there is usually one solution: seeking a skilled therapist able to bridge the different views. There’s usually emotional baggage that is preventing those involved from being objective, so a professional is needed to address the emotional gap. This is easier said than done, as all those involved need to commit to the process for it to work.

We are however going to focus on situations where family members have good governance in place (formal meetings and formal rules), they respect each other, they genuinely have both the family and the business’ best interests at heart and yet still can’t agree on the way forward – as this is a situation more common than the one described in the paragraph above.

Mechanisms to support conflict resolution

Any conflict resolution framework should present the following characteristics:

Be written down: The conflict resolution process should be pre-agreed by family members and documented in a signed family charter. This ensures that when tensions arise, everyone knows the next steps.

Objective, fair and inclusive: The process should be objective, fair, and inclusive: independent and unbiased, considering all views equally, and trusted by everyone involved.

Family members should trust the process: Triggering the conflict resolution process might feel drastic, reflecting a failure to reach consensus. While it signals a tough time, following steps 1 and 2 ensures proper checks and balances. The outcome aims to address the issue while preserving relationships. Though some may be more satisfied than others, everyone will understand that the process was fair and objective, making it easier to accept the result and move on.

Many families agree on decision-making through voting by simple majority. This is a good way to decide on simple, easy matters, but it is not recommended as a conflict solving mechanism. It will likely create a winning and a losing side and more often than not, one side feeling that they haven’t been heard, understood and respected, leading to more conflict.

The conflict resolution mechanisms that families can adopt include:

Conflict Resolution Training: Provide training in conflict resolution skills to all family members.

Joint Problem-Solving Sessions: Organise collaborative problem-solving sessions with an external expert, where family members work together to identify issues and develop solutions.

External Advisors / Advisory Board; Appoint advisors respected and trusted by all family members, individually, or collectively to form an advisory board of non-family members who can bring expertise and objectivity to the decision-making process.

Regular Consultation: Consult the external advisors / advisory board regularly for guidance on complex issues that could lead to conflict.

Mediation: Engage a neutral third-party mediator to facilitate discussions and resolve the dispute through breaking down the different views.

Arbitration: Consider using arbitration for more serious conflicts that cannot be resolved through mediation. Arbitration involves a neutral arbitrator making a binding decision based on the evidence presented.

Often, families can decide on “layers” of the process, starting with a joint problem-solving session and moving on to arbitration if the first step yields no result. Whatever they decide, the most important element is that all family members trust and respect the process and the people they have chosen to help them.

Conclusion

All families need to deal with difference, it’s part of the make-up of any family with multiple personalities, generations, and priorities. Differences can lead to tension, but this does not have be a deal breaker – it can be resolved.

For further information about any of the insights shared above or to find out more about Bedrock’s Family Strategy and Governance services, please do reach out info@bedrockgroup.ch.

Author: Maria Villax, Head of Family Strategy and Governance at Bedrock

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