Instilling professionalism in the family business

“Its hard to move forward on Governance policies and Succession until the family has established some form of mutual respect among its members”

Sibling rivalry is a conflict that could last for the long term – one that could be very difficult to handle and prevent.  In spite, it is not impossible to instil the value of professionalism as guideline for the siblings’ conduct and actions as regards their participation in the family business.

According to Dr. Sylvia Rimm, psychologist, author and parenting specialist among others, although sibling rivalry can be reduced, it is unlikely to be entirely eliminated. In moderate doses, rivalry may be a healthy indication that each child is assertive enough to express his or her differences with other siblings.

The problem crops up when siblings work together – arguing irrationally and acting  unprofessionally.  Professionalism is therefore integral in the success of a family business.  Briefly, it means acting appropriately and in a manner that is acceptable and in accordance with business and workplace ethics.  Professionalism proves to be beneficial in certain ways:

Sets aside familial wars from business concerns   

Siblings tend to rekindle past negative experiences with each other and get overly emotional which badly influence their performance and teamwork.  The ability to separate one’s feelings, perceptions and responses to situations at the professional business setting is clouted with the memory or existence of familial wars.  Professionalism engages the siblings to focus their attention and efforts to what could be contributory to the family business, instead of allowing their negative emotions rooted from past rivalries to take over.

Promote healthy competition among siblings 

Siblings may want to show how better they can be from each other and this could be healthy especially when sales or expansion targets are successfully met, even surpassed.  However, when professionalism is neglected, competition may become so intense that it may lead to non-compliance to rules and regulations, bad mouthing, acts of violence, illegal transactions, etc.    Hence, instilling professionalism develops the siblings to abide with rules and proper conduct that value healthy competition.

Keeps resources dedicated for business use only 

Sometimes, siblings feel that they have the prerogative to personally make use of the family business’ resources since they hold ownership. Like children, they may tend to fight over personal use of the family business’ resources.  Resources could be in the form of budget, assets like cars, other consumable supplies, etc.  Such personal use of resources is an example of an unprofessional practice. The resources of the family business have to be dedicated only for business use so that all expenses are accounted in accordance with what the business truly requires t operate efficiently and effectively.

Ensures the quality and promptness of work delivered by the siblings

The siblings may think that among them, some are capable and some are not in producing quality work and prompt delivery which may result to rivalry.  Siblings must understand that as part of the family business, they must possess the relevant expertise (educational background and significant experience from outside companies) first.  In this way, they can prove that they are truly professionals and are deserving to take on significant positions in the family business. They also need to deliver their work on time without receiving any special treatment with regards to having granted extensions to finish the final report or meet with an important client.

Defines specific roles of the siblings in the family business 

The eldest can no longer dictate to his youngest brother whatever he feels and thinks for the other to do.  In the professional setting, skills are recognized. Roles are defined.  Who does what is according to the roles which each and every one is assigned to in the family business.

Enforces the implementation of a family business sibling participation agreement

A participation agreement binds the siblings to comply with the family business’ rules and standards in identifying what requirements are to be met so that the siblings could take on a position in the family business i.e. how much should the compensation be, what benefits will be given, how communication (family forum) will be conducted and what could be the termination and retirement plan. When all siblings are professional, they will base their objectives and actions as to what has been agreed upon.

Engages the siblings to observe structures by listening from and cooperating with outside business experts 

Since siblings easily argue, an outsider who already has proven track record in the business industry should be included in the management of the family business in order to open up for other perspectives and leadership.

My experience in working with many family businesses on this and related issues leads me to conclude that the best family businesses recognize that professionalism is key to long-term success in maintaining positive sibling partnerships.

Professor Enrique Soriano
Professor Enrique Soriano

Professor Enrique M. Soriano is the Chair and Professor of Global Marketing at the Ateneo Graduate School of Business. He has held key positions in a number of Asia – based corporations such as Group CEO of the Belo Medical Group, CEO of Intelligent Skin Care, Inc., Chairman of publicly listed Empire East Suntrust Developers, and Country President and CEO of Singapore based Electronic Realty Associates, Inc.

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