Conflict in the family business

Family businesses are the cornerstone of the British economy

Family Business Conflict

Based on experiences of working with families in business, when a family gets into relationship conflict. What usually happens is that the root of the problem is ignored and instead the focus is conveniently shifted onto the ‘business’ symptoms, the areas where the problems are commonly manifested – cash flow, financial structure, profitability, and employee motivation to name a few.

Often the result is many changes but very little real and sustained change in behaviour.

The issues affecting a family business can be more about ‘families’ than about ‘business’ and issues are always much more complex than they seem. Problems in the business can be deeply rooted in relationship problems between family members, which may rarely be apparent at the outset. There are no quick-fix solutions here.

There are a myriad of relationships that can exist within a family business. The relationship we are convinced is one of the major factors impacting on the transitional process of the family business from one generation to the next, is the one between a father and his children.

From a business perspective, the son almost always has some independent ideas that differ from the father’s, if for no other reason than a generational perspective. Given the essentially emotional nature of family relationships, it would not be surprising if there were confusion about whether a son’s actions were a form of rebellion rather than a reasoned disagreement over business issues. Sorting through this requires some understanding of the history of the father/son relationship, as well as the dynamics of the entire family constellation.

The learning experience of daughters working with their fathers is a special and particularly interesting context in a number of ways. Firstly, the involvement of the founding generation is often protracted and overlaps the involvement of younger family members, enabling a range of possible mentoring roles. Secondly, younger generations growing up in the family business environment enjoy a lengthy period of socialisation, not only into the family and society but also into business and the specific family enterprise. Thirdly, this socialisation process may be undergone within an environment where there are powerful and explicit family expectations about future roles in the business and perhaps eventual management succession; on the other hand, these expectations may operate only at the subtle, tacit level or indeed be non-existent.

When there is conflict with families in business, most of the problems are caused by the people involved. They do have a say in their problem and they do have the power to alter the outcome. In the end, all we have is family, and if there is conflict it is up to the people involved to sort it out. To achieve this may mean working with professionals who understand families in business.


Pete Wilmer

Corporate Finance Partner

Martin Wilmott

Partner, Doncaster
01302 367 262

David Cairns

Tax Partner, Northampton