Family Business Disputes

When a family business conflict arises, MCN seasoned mediators will help you keep your family intact, while preserving the business you’ve worked hard to create. Learn more about how MCN can help.

In family businesses, where the twin currents of family and business run through so many decisions, conflict is inevitable. While conflict presents challenges for any organization, internal conflict in family businesses has a special complexity. It is often the product of experiences preceding, and factors outside of, the business issues that spark the immediate dispute. The conflict may have started years earlier on the playground, around the dinner table, in birth order, or even in a previous generation. The history may be silent, invisible, half-forgotten, but it is often a powerful presence in the conference room. Businesses become stymied by conflict that has little or no connection to the business problem at hand.

The process of MCN mediation can play an invaluable role in resolving family business conflicts. It can direct energy away from old grievances and toward finding business solutions for business problems and preserving working relationships. For a family business, protecting working relationships is not a luxury; it is a necessity.

A mediator is a neutral outsider who works with all the involved parties to craft a resolution. Unlike an arbitrator, a mediator does not mandate a settlement; rather, he or she helps the parties communicate and develop a mutually acceptable solution. Compared to other options for resolving disputes, mediation is quick, inexpensive, and private. It is also an informal process, not limited by rules of evidence, procedure, or remedy. Because of this, mediation allows for maximum flexibility in crafting a resolution acceptable to all parties. Because of the informality and the guided, mutual communication, a mediated, as opposed to arbitrated, settlement has a better chance of soothing not just the business problem but also the troubled relationships that exacerbated it.

“Non-adversarial” does not mean that there is an absence of conflict or that antagonisms cannot be expressed during the mediation. Instead, non-adversarial refers to the process used to air and resolve the dispute. The skilled mediator does not put constraints on the discussion, but rather helps keep the focus on the parties crafting a solution. Thus, the mediation allows discussion on the source and substance of the conflict and helps people recognize their counterproductive patterns, with the aim of being able to move past them toward a businesslike, problem-solving mode.

Long-standing resentments have a place at the table, insofar as people can come to see how those resentments are standing in the way of the ultimate task at hand. Mediation, then, can not only result in specific terms of agreement, but can also offer an enormous advantage to a family business: the parties learn that they can communicate further and/or differently in the future. Under the mediator’s guidance, once they accomplish this, future productive interaction will no longer seen “inconceivable.”