Mauro Libi: Most common problems in family businesses

     As we pointed out earlier, in family businesses operate two systems, company and family, whose union can create conflicts by interposition of both. So, we have, for example, the small and medium-sized enterprise (SME), in the hands of family clans, it increases the demand and production, increases the billing, among other aspects. The organization is developing and acquiring a greater volume that demands another type of driving more professional and increasingly removed from the initial criteria imposed by the group founder, by the family owner.

     The new structure is being formed as the organization grows and develops demands, a new type of management that responds to professional opinions, to the modern administrative tendencies in which the old criteria of family management appear outdated. This requires the incorporation of managers into the organization in which the decision-making power previously entrusted to a member of the founding family. Conflicts begin between middle management and the role of the chief executive that coincides with the majority shareholder, all in one person, and then the delegation structure is blurred.

     We are in the presence of a superposition of two systems in an organizational structure in which its members have a double role, as managers and shareholders. In family businesses, the two systems, family and company, have a different logic, need and conformation, while the family is governed by love and affection, the company demands logic of efficiency and productivity. This is the difference between the two systems in which the roles are occupied by the same people.

     This generates conflicts appear from the discrepancies that the convergence of roles implies. Demands from each of the systems whose headlines are the same, come the tensions and the company begins to operate inefficiently. It is a difficult conflict to solve because it is a dilemma of great dimensions for the managers and shareholders who (as we have already said) are the same people, between protecting the family interests or the company.

     Among the problems that often arise in family businesses are also those referred to the succession, as members of the clan are not always willing to give up the positions they occupy. In addition, problems arise due to the entry of in-laws who are integrated into the executive structure as in the directory. In the same way, in family businesses there are often more individual needs than positions available for clan members to occupy. Other problems arise in the new generation stage in which the obligation to continue together faces the desires, affinities or interests of every one.

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