Five letters that can make magic in your family business – Continued

Many times, the power struggle between competing leaders in a family business are in effect, competition for the founder’s trust. For example, when the founder’s brother and the founder’s son are in responsible leadership positions in the company, they each vie for the founder’s trust. When they take opposing positions on an issue, the founder’s final decision is seen as a sign of who he trusts more. A similar trust equation is at play between professional managers and family members.

Then, there is also external trust – the trust of stakeholders and customers on the business.  This is linked to the company’s intangible equity (brand equity if you will) and is created over a long period of time.

Trust has to be reinforced repeatedly for it to thrive. It takes years to build but only a small misstep to break. There are many recent examples of established brands squandering their hard-won customer trust by some bad decisions – Volkswagen comes to mind.

At FABRIC, we work with family businesses on individual coaching and group interventions to assess, prioritize and re-establish trust.

Read more:

6 ways to build your family’s human capital 

What Influences Culture in Family Businesses?

Keywords: Trust, professional managers, power struggle, brother, son, founder, trusting environment, magic ingredient

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