Conflict management and resolution in family-owned businesses

Abstract

Purpose – The purpose of this paper is to review the literature concerning the negative effects of conflict among family businesses and to make practitioner focussed recommendations for the prevention, management, and resolution of conflict. This paper discusses the prevalence of conflict in family firms, differentiates the types of conflict present, and recommends proven approaches to prevent and manage the conflict, with a focus on corporate governance tools. Examples of well known companies are presented. Design/methodology/approach – A review was conducted of the literature concerning family business conflict and corporate governance. Findings – Conflict is a common problem in family firms that has significant consequences for the business and the family. Research has shown effective governance may reduce and manage conflict. Research limitations/implications – This was a literature review. As such it did not perform original research. Practical implications – This paper has practical implications for family business practitioners. The paper offers the negative aspects of conflict and recommends effective mechanisms such as governance tools to enable the prevention, management, and resolution of conflict. Social implications – Implications exist for practitioners and policy makers in order to reduce conflict and increase the viability of family firms. Originality/value – The scholarly literature has been reviewed and synthesized into distillation for family business owners.