Thousands of family businesses across Ireland can perform better if relatives who work together can avoid confusion about their professional and family roles on the job, says an organisational psychologist at UCC. Adam Harveyreports.
Dr Anthony Montgomery, of the university's applied psychology department, says "role confusion" is a big problem inside family businesses.
Speaking ahead of a workshop at the John C Kelleher Family Business Centre next week, Dr Montgomery says employees in all types of companies need to have well-defined roles at work.
In family businesses, however, there is potential for things to get mixed up.
Areas of potential conflict in family businesses include decision-making, career development and reward structures.
This has serious implications in Ireland where three-quarters of all businesses are family-owned, accounting for 50 per cent of all employees in the State.
They range from small husband-wife grocery stores to massive property development, department store and supermarket businesses.
For husbands and wives, siblings, or parents and children who work together, it can be tough to switch back and forth between their professional role and their role in the family, he says.
"It can be difficult to have a clear boundary between a professional discussion and a discussion with a non-professional element," said Dr Montgomery, who is an organisational consultant as well as an academic.
He says family members might also be under the impression that the rules do not always apply to them. The only way to keep things workable is for managers to cultivate professional relations with all workers, whether they are employees or family.
That means equitable treatment of all workers, regardless of whether they are family or not.
Leaders have to provide a "vision" for their organisation and their staff - all workers need to know what is expected of them, and where their company is headed.
"At the end of the 21st century there's a greater need for managers to cultivate social relations with workers," said Dr Montgomery.
"Hierarchies have become more flattened. People are more aware of their rights. They're more educated. The need for people to be treated more and more like individuals is becoming stronger and stronger."
He says some of the best-performing firms in the world are the ones where there's a good mix between work and social relationships.
Companies like Google, Pixar and US software firm SAS are seen as fun places to work, with plenty of interaction between staff. Family businesses are no different.
Managing family relationships in a company is similar to the firms where the boss has strong, friendly bonds with employees.
"They might play golf or go to the pub with certain members of staff. It's exactly the same problem," says Dr Montgomery.
Old-fashioned management styles, with aggressive management techniques and a vast gulf between bosses and the employees, no longer work.
He says a ranting, raving boss who rules by fear is a poor motivator.
"There is a lot of evidence that people perform worse when they're stressed, and better when they're relaxed. In some organisations a vicious cycle of screaming can prevail. You're becoming stressed, which means you're making mistakes, which can make them scream louder."
Firms need "transformational leaders". They are the ones who have better relationships with their co-workers because they motivate staff by inspiring them, provide intellectual stimulation, and make employees feel good about themselves because they consider each worker as an individual.
• The Family Business Network Ireland workshop titled Managing Our Friends/Family in a Work Context: the Boundary between the Personal and Professional will be held at UCC on Wednesday, December 12th.
