"The challenges that family businesses face are not single events; they are ongoing, evolving and often unsolvable. If we approach them as problems that require a solution, we waste our valuable time and energy.
The most successful family businesses have developed the vital capacity to manage polarities in concurrency as an ongoing resource."
It’s often said that good management is about making the right trade-offs and, indeed, there are many trade-offs in family business leadership given the competing demand of the business logic and the family logic:
- family vs. non-family executives
- profit distribution vs. business growth
- meritocracy vs. kinship relations…
Family businesses grapple with issues like this often. Yet, some of the most successful families develop collective decision processes over time that allow them to accept inherent dichotomies as opportunities instead of problems to be solved. It’s about replacing either/or thinking with both/and thinking.
Accepting inherent dichotomies as opportunities
Nacht and Begalla draw from research and models in the managing paradox literature to explain how family leaders may be able to avoid having to choose between opposing interests and instead be able to embrace the inherent duality and manage for concurrency:
“As Schuman and coauthors noted in ‘Family Business as Paradox’, risk/stability, individual/team, harvest/invest tend to be viewed by family business owners as choices. But often, choosing one or the other prevents family firms from succeeding to their fullest potential."
Both poles must be developed consistently over time in order for the family and the business to truly thrive.”
Family business as paradox
Good management may be about making the right trade-offs, but great management that leads to long-term family business success may require breaking those trade-offs. Instead of asking, “Am I focused on the success of the business, or the harmony of my family?”, ask: “How can I ensure I have business success and family harmony?”
“Do we rely on how we have always done things, or do we try something new?” can be asked as: “How can we utilise our experience of what has worked in the past and incorporate some fresh new ideas?”
In the words of Nacht and Begalla:
“It may not be enough to wear the “business hat” sometimes, and then take it off to wear the “family hat.” This approach is reflective of either/or thinking, and is unnecessarily limiting. We need to develop the ability to wear both hats at the same time.”
For more on this, watch this video of Ivan Lansberg calling for family business leaders to become ambidextrous and build their skills at leading both the enterprise and the family.