While facilitating a family meeting recently, I was asked what is needed for a family ownership group to function effectively. Given the importance of this question to all families, I’ll share the response here.
During your family meeting, I was asked to identify the most important ingredient in how a successful ownership group functions. My response was simple—trust.
Trust is an amazing force that can bind people and give them the courage and confidence to do great things together. When trust is high, we don’t worry about all the bad things our group might be doing to harm us; instead, we sit comfortably knowing that others have our backs and are there for us when we need them. In the case of family business owners, trust means knowing that each one is pursuing his or her role passionately, and that the greater good is being served when each of us allows the others to make decisions in their respective roles. So we trust board members to guide the business, we trust managers to run the operations, we trust the family to make good decisions with the foundation, we trust that the owners will speak with one voice and give clear direction to those who oversee family assets, and so forth. The bonds of trust can be much stronger than steel.
And yet trust can be fragile as well. When we find out a person is talking about us behind our back, or skips a deadline, or says one thing and does another, our reservoir of trust with that person gets damaged and begins to drain. If there are too many small holes, or even one gigantic hole, trust can head toward zero. When this happens, we start to see others as working against us and begin to question their intent. Other people resent our lack of trust in them and begin to resent us in return. Left unchecked, this process can spiral negatively, leaving the relationship empty and paralyzing the decision-making process for the individuals involved. Imagine trying to make an important business decision when we see other group members as the enemy.
So how do we keep our trust buckets full?
When I look at those family groups with the highest trust levels, they seem to have a few things in common. First, they work hard at keeping their commitments and they keep others informed if there are changes in plans. In other words, they are excellent at acting as they say they will, and they communicate when plans change. They also work very hard at truly listening to each other, making sure each understands what the other is saying and, more important, digging to find the underlying meaning behind the other’s words. Knowing why someone is so passionate about something leads to greater understanding and better decision making. And, most important, those who have the greatest trust levels work actively to build trust. When something happens that punches a small hole in the trust reservoir, they act to patch the hole immediately. For instance, if someone speaks about them behind their back, rather than stewing on it and letting anger or resentment build, they speak with that person and put the issue on the table. They know it is far more important to resolve the issue and maintain full trust than to worry about any discomfort in approaching the person about the matter.
It has been a great pleasure to see the high levels of trust in your family. I especially hope that as you move forward as a family, you will always be one of those families that actively and passionately builds trust with one another.
Christopher J. Eckrich, Ph.D.