Jones, George, Haddad, Essentials of Contemporary Management, 5thCE Instructor Manual
Chapter 6 Communication and Information Technology 14
Why the reticence? Miller says he knew a nonfamily manager at another family business
who took sides and paid dearly for his mistake. A family member had privately solicited the
manager’s opinion in a dispute he was having with his kin, Miller says. The manager sided with
the family member who sought his view, assuming the conversation would remain confidential.
But, in the heat of a contentious meeting that the manager attended, the family member passed
on the manager’s comments to his relatives to prove that other employees backed him. The
manager’s “relationship with the family was never the same,” Miller says.
Getting caught in the crossfire of a family feud is a daily peril for many employees of small
family firms. Big corporations controlled by families also have their share of such intrigue, of
course—but a small company’s size and informality sharply increase workers’ vulnerability to
the fallout from family rivalries.
Even outsiders who are big fans of family businesses say they can create trying work
environments. Cornell Diamond has worked for the past seven years as financial director of
family-owned Knighton Optical Inc., a manufacturer and retailer of optical lenses in Ogden,
Utah. He gets along so well with the Knighton family members that he takes mountain-biking
and pheasant-hunting trips with them. He also attended graduate school with one of the
Knightons.
Yet Diamond recalls the tense period when the family bought out one of the three Knighton
brothers. His siblings felt “he was not carrying his share of the load,” Diamond says. And
although he tried to distance himself from the decision, “I became part of it,” Diamond says.
“This brother viewed me as being on the team against him.”
His dealings with the brother become highly strained. Among the problems, according to
Diamond: The brother began to ignore Diamond’s requests for financial information related to
Knighton Optical operations, and, at meetings preceding the brother’s departure, “he treated
with sarcasm anything I tried to initiate,” Diamond says.
As a chief financial officer for two family businesses, Mark Larsen says he frequently found
himself in the middle of family dramas. “I’d spend 50 percent of my time doing things not directly
related to the traditional role of a CFO,” says Larsen, now a Beverly, Mass., family-business
consultant.
At one former employer, Larsen recalls, generational differences between family members
disrupted the company. It took hours of heated meetings over several days to decide whether
the business should buy company cars made in Germany, with a younger family member
strongly at odds with one who had lived through World War II. During such disagreements,
“sometimes I’d take on the role of referee,” Larsen says. Were there shouting matches?
“Sometimes,” he says.
Larsen continues to believe small businesses are still good places to work, partly because of
the access executives have to company owners. But on some of the days when he had to
mediate disputes, he says, he would “go home wondering, ‘Why have I chosen to work with
these people?’”
Karen Toney was asking herself the same question when she worked for a small family-
owned apparel maker in Boston. A father, his sons, and their cousins “were always fighting over
the business, doing things behind each other’s backs,” Toney says. “It was very uncomfortable.”
One relative’s suspicions about his kin grew into a distrust of all workers, Toney says: The
family member began accusing employees of stealing inventory. “He was always lurking
around, watching everyone,” she adds. After a few years, she says, “it really became impossible
for me to stay there.”
Toney has since worked for two more family firms, including her current employer, Agar
Supply Co. She joined the Boston wholesale food distributor in 1992 as an administrative
assistant to the founder’s son, Alan Bressler, who is the company’s president. Bressler’s
daughter Karen runs a company division.