I’ve seen family business on all points of the “functional-dysfunctional spectrum.”
If I were to make one overreaching generalized observation, I’d say the more functional the business is, the closer the family members agree on the key issues facing both the business and the family.
Those key issues are the overall vision, expectations and roles.
If there is a unified vision, then each family member knows what he or she is working toward. That helps define everyone’s expectations of what they will become in the company as it moves into the future and what the company can expect of them. It also defines everyone's roles as the company matures. More unity and agreement typically translate into more functionality.
Without these agreements, family members are in some sort of limbo, waiting for a parent or founder to move the company forward in an arbitrary fashion. The head of the family often appears to make promises that somehow dissipate into thin air causing demotivating resentment then outright hostility as time goes on, causing a downward spiral in personal and business morale, which then reflects on the overall performance of the company.
I’ve heard too many family members say, “I remember being told I would become…” or “I was promised….” Less unity and agreement typically translate into increased dysfunction.
In a perfect world, the company leader should clearly articulate the foundational elements (mission / vision / values / business structure) of the business and present them to each family member for agreement.
If there is disagreement or misunderstanding at this point, the stage is set for difficulty for both the business and the family. These elements and progress toward agreed-upon goals should be addressed regularly to consider modification to resolve real or imagined conflict as changes in the marketplace occur and opportunities become evident.
The more proactive each family member who is active in the business can be in discussing misunderstandings, interfamily problems and disappointments in a businesslike atmosphere, the easier it is to resolve them, get over them and move on to building a constantly better business based on mutual cooperation, trust, and family unity.