Neuroscience and Family Business

JoAnne Norton
JoAnne Norton

Almost everyone remembers a time in childhood when they felt left out—the party they weren’t invited to, the snub by someone who was supposed to be a friend, the time they weren’t rewarded for a job well done, especially when others were being recognized. Even as you read these words you might still feel the sting of something that made you feel shunned or ostracized a long time ago. Now, thanks to neuroscience, we know why this pain was so severe and why you still remember.

Social neuroscientists at the University of California, Los Angeles are studying what goes on in the brain to help leaders understand how their actions affect their followers. These researchers use functional magnetic resonance imaging (fMRI) along with other sophisticated equipment, and the results have important implications for leaders of family businesses. One of the most pertinent studies for family business owners was conducted by Dr. Naomi Eisenberger, a social neuroscience researcher at UCLA, who studied what happens in the brain when people feel rejected. Her research indicates that when we feel excluded our brains have the same reaction they would to physical pain.

Dr. David Rock, the president of the Neuro Leadership Institute, writes Eisenbergers’ research illustrates “people who feel betrayed or unrecognized at work . . . experience it as a neural impulse as powerful and painful as a blow to the head.” Rock claims many studies show the brain responds to social needs the same way as it does for survival.

Family leaders must be aware of the unintended consequences of accidentally excluding a family member. Perhaps you thought Aunt Alice was drastically overreacting because she didn’t receive the information she thought she should have been given. When her face turned beet red and she began screaming at you just before she angrily stormed out of the room, she wasn’t being overly sensitive. Her brain was telling her you had just hit her over the head with a baseball bat, and she was responding accordingly!

Family leaders who understand how strong the brain’s reaction is to being excluded, betrayed, or unrecognized can be more sensitive. There are steps they can take such as:

  1. Making certain all family members are invited to family meetings and gatherings;
  2. Seeing that pertinent financial information is accessible to everyone;
  3. Establishing family policies so all family owners are given the same opportunities in the business;
  4. Creating a Code of Conduct giving all family owners the chance to talk about how they expect to be treated and what is important to them;
  5. Recognizing the hard work of family leaders as well as business leaders; and
  6. Showing appreciation to family members and employees.

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