How families solve conflicts.

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From the research workshop. Entrepreneur families create rules and statutes that regulate life together, especially in responsibility for the company. In addition to agreeing and respecting specific formal rules, it is important that entrepreneurial families know and take into account the foundations that shape all social systems.

Conflicts in entrepreneurial families are not the exception, but the rule. This has to do with the demanding life in these families. The members must be able to reconcile family and entrepreneurial matters, at the same time being a private family and a business entrepreneurial family, and in order to solve this problem, specific norms for dealing with each other are often agreed in detail. But this will only be successful if they are based on basic rules that apply to all sozialen Systemen

Social systems arise when people live or work together - in Families, teams, companies or in society. There are always five points at stake: determining who belongs and who does not, taking into account the temporal priority of von Mitgliedern, recognising performance and commitment to the system, taking into account individual skills and competences within the system and, of course, the appropriate balance between give and take. This principle is particularly important as it frames all other system rules.

When people behave in the social sense, they always act in an economic sense. Action can be understood as an interpersonal exchange between people who give and those who take. Every giving action creates a claim to get something back from the one who takes from the giving by his action. This creates relationships between persons, liabilities and obligations.

Conflicts arise when people charge for what they have received and given in different ways. Members of entrepreneurial families should therefore make it quite clear what they expect from each other and what they would like to receive for their membership in the entrepreneurial family.

In order for this to be possible, it must first be clear who belongs to zum System and who does not. While membership of the family is self-evident as a rule because it comes about through family lineage, membership of the entrepreneurial family is not determined in this way. Those who belong and those who do not can regulate their ownership rights to the company. However, whether partners of members of the entrepreneurial family whose partnerships are sealed with or without a marriage certificate also belong to the family requires joint decisions.

Clarity about affiliation is a prerequisite for giving and taking in the entrepreneurial family and thus for answering the question of which persons are subject to the rights (take) and obligations (give) associated with membership. Conflicts can arise if these membership criteria are not clearly regulated.

However, not all members of the entrepreneurial family always have equal rights. Membership differentiates itself primarily in terms of time. This becomes particularly visible when new members are added, such as partners or owners who assume their responsible role with regard to corporate ownership at the beginning of their majority. Then it turns out that those with a longer membership usually expect the new members to take this temporal priority into account. The new members should (initially) subordinate themselves to the old members who have established the system so far. Conflicts can arise if this principle is not observed. If new members want to change the established and proven system order according to their ideas with their ideas and drive, this often leads to problems.

The chronological order between the (private) family and the (business) entrepreneurial family also has an influence on their stability and ability to develop. The experience of successful and long-lived family businesses shows, however, that the opposite rule applies: the younger system has priority over the older system of the family. The interests of the entrepreneurial family have priority, especially when it is a matter of devoting all one's energy to the preservation and future of the company in difficult times. Conflicts can arise if this priority position is not realised or interpreted differently in the entrepreneurial family.

As a social system, an entrepreneurial family is all the more stable the better the members of the system succeed in recognising and valuing the commitment and services they show to the entrepreneurial family. The commitment and performance of the members to the system, all that they give to the system, ensure and increase its resilience and create the necessary flexibility to successfully cope with the ever-changing environmental impacts and challenges of a globally changing society.

Conflicts can arise when the commitment and achievements of individuals to the system are not seen or appreciated. In the worst case scenario, the willingness to work and perform will completely ebb away.

People are different, they develop different competences and abilities. The better the entrepreneurial family manages not only to perceive the personal strengths of its members, but also to integrate them into the system in an appropriate way, the more stable and developable the family will be.

This applies especially to the three dimensions that shape all living together and working together - head (ratio), heart (emotion) and hand (structure). At best, a division of labour based on the competencies and abilities of the members is established in entrepreneurial families. Everyone finds their place in the system where they have pronounced competences.

In this case there are family members who take care that the necessary data, information and knowledge complexes are available (head). Others ensure that relationships and communications are based on mutual appreciation and recognition (heart). And a third part of the family ensures that the structure of the entrepreneurial family is geared to appropriate action or is accompanied by the necessary company-related performance (hand).

Conflicts can arise if this competence- and capability-based organisation of the entrepreneurial family does not succeed. If one of the dimensions mentioned is too little or too strong, the balance of head, heart and hand is missing. ®

Author: Professor Dr. Heiko Kleve,

Endowed Chair for Organization and Development of Entrepreneurial Families at the Witten Institute for

Family business (WIFU).

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