Family Business Lessons Learned from the Debt Ceiling Debates

Chris Eckrich
Chris Eckrich

While speaking about contentious politics is fraught with risks, it seems that family businesses can learn a thing or two from the experience of the past month’s debt ceiling debate, so I am daring to enter into that fray in the name of education on good process.

  1. Demonizing your opponents creates “Us” versus “Them” at the expense of “We.”  Sound bites degrading members on the opposite side of the aisle increase tensions and take focus off of true problem solving.  Even after a problem is solved or decision made, the other side is seen as a little less human and worthy of less consideration.  While this is old hat in politics, it is incredibly destructive in the realm of family enterprise.  When we degrade others behind their backs and dehumanize them because they disagree with our positions, we directly contribute to mounting distrust in each other and make our systems of decision making more fragile and toxic, increasing the likelihood that our next decision may be ineffective, or worse.
  2. Seeking commonalities on values and vision comes before financial decisions.  Left mostly undiscussed in the debates (or at least in most media outlets) were the core questions of who we seek to be as a people and what it is that we value in common?  Family ownership groups that take on financial decisions before agreeing what direction the family seeks to drive the enterprise, or the values to be lived out in the enterprises they own, often find conflict in rich supply, if there are divergent ideas about direction and values.  Forcing decisions before coming to agreement on these foundational elements creates surface conflict that ignores the more deeply rooted beliefs that are really driving the dialogue, even if unspoken.  Spending time getting aligned on vision and values creates a context to make later tough economic decisions.  Ignoring them leads to polarization and reduces decision making quality.
  3. Agree on the rules before entering into contentious discussions.  There were moments in the debt ceiling debate where arguments emerged about who had the authority to do what, and by when.  While much of this was political positioning, these uncertainties created distrust among many who questioned that the system could function on behalf of the citizenry.  And, other than those who prefer chaos, a general pall was felt by many.  Family business owners need to know how they will make decisions before being faced by tough, meaty challenges.  Who gets a voice?  How will dissent be communicated and dealt with?  Can a few stop a decision, or does majority rule….or a super majority?  Answers to these questions provide a path forward, even in very challenging times.  Chaos chokes the decision making process and can result in stagnation or paralysis.
  4. Elections matter.  While the political debates were at times chaotic and incoherent, they absolutely highlighted how important it is that the people seek individuals who can represent them well.  Our family business equivalent occurs when we elect boards to oversee the enterprise (and protect shareholder value), and when we elect family members to serve as heads of our family councils, committees and task forces.  We need people who understand their charge, accept responsibility for outcomes, and whose judgment will bring gains for the enterprise or family body.  Our decisions about who will represent us should reflect our confidence in their ability increase our capacities while respecting our values, vision and culture.

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