By: Prof. Enrique Soriano
“Businesses are often defeated by competitors when siblings battle emotionally against one another using the weapons of business strategy”
EMOTION-driven sibling rivalry is rooted in problems of self-esteem, the primary solution must be built on methods that encourage the adult development and individual maturity of each of the siblings. One must recognize that the primary problem is not, in fact, between the siblings, but rather between each child and their need for recognition from his or her parent.
Behavioural research have shown that emotion-based sibling rivalry is the struggle to gain attention and love from parents that was missing during childhood. The adult child’s actions and behaviors are directed toward gaining approval and recognition from his or her parent. This need may continue psychologically even after the death of the parent. Rather than having a strong foundation for their own self-esteem, these adult children continue their emotional craving for and dependence upon their parent’s approval.
Strategic rivalry
The second type of sibling rivalry is rooted in conflict over business styles and strategies rather han family emotions. While emotion-based rivalry is really about the child and the parent, strategy-based rivalry is really about the siblings. Frequently, such strategic conflict is driven by differences in personality concerning levels of financial risk. Strategic conflict among siblings has a very different emotional content than the struggle of rivalry or parental attention.
Solutions to strategic rivalry are difficult, but require business solutions, rather than psychological growth. Siblings need to develop their strategic planning, carry out good financial analysis, and explore alternative methods for ownership as business partners.
Finding solutions
Businesses are often defeated by competitors when siblings battle emotionally against one another using the weapons of business strategy. When sibling conflict creates tensions within your family and business environment, make sure you first define the real underlying problem: is the core of the rivalry emotional or strategic? Then take the proper course of action consistent with the real issues.
As a business coach and consultant to family firms in Asia, one of my most rewarding experiences has been to sit down with brothers and sisters as they re-negotiate the old rivalries, the old stereotypes from childhood. Usually this has happened after the unexpected death of a parent, when siblings are suddenly forced to make major decisions without Dad in the room.
It is wonderful to see siblings – who assume that they already know all about each other – reach beyond the rhetoric, and enjoy the surprise of meeting their brothers and sisters for the first time as adults, equals now, but with an extraordinary bond, which can’t really be duplicated in any other relationship.
Family Council
The development of a Family Council, usually with the assistance of an expert in healthy family process and conflict-resolution, remains the most practical way to develop family agreement around succession planning, hiring standards for family members, stock distribution, and other hot topics. Dealing directly with these issues in advance in an organized forum remains the best insurance policy against sibling or cousin rivalry disrupting the family firm.
Another sensible recommendation for siblings who are in business together is to not work in the same functional area. The classic case study for this is the massive fallout between the two Lotte sons of the billion-dollar Korean giant Lotte Group. The extent of their disagreements was such that the fallout led to the ouster of the founder. As I write this article, the corporate cases are still being litigated.
Other methods where I had a first hand experience include having siblings or the child not report to a parent. This divorces the emotional aspect of the business relationship. However, it also requires a strong and empowered manager to effectively manage the owner’s children.
If siblings, especially those who need to make consistently good decisions together in the family business, can re-define their adult relationships based on the current realities, the adult bond between siblings can truly become profound. They will rediscover that they share not only bloodlines and a stake in the family business, but a lifetime of irreplaceable experiences.
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This August 31, a Saturday, I will be sharing the stage at Manila Marriott with prominent Governance Leaders / family business owners in the biggest Family Business gathering in the Philippines. The public event entitled, “Can Family Run Businesses Last Forever? I will share the secrets in building 100-year old enterprises. Seats are limited. To reserve, please call Aira and register at 09228603186 or events@wongadvisory.com
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Prof Enrique Soriano is a Book Author, World Bank/IFC Governance Consultant, Senior Advisor of Post and Powell Singapore and the Executive Director of Wong + Bernstein Family Advisory Group, a research and consulting firm in Asia that serves family businesses and family foundations. He was formerly Chair of the Marketing Cluster at the ATENEO Graduate School of Business in Manila, and is currently a visiting Senior Fellow of the IPMI International School, Jakarta.
