The concept of family differentiates family businesses from their non-family counterparts. The family circle brings along elements like tradition, stories, legacy, relationships and above all – emotions.

The atmosphere of family businesses is at times emotionally charged, which adds complexity to the running of the business itself. Another level of complexity comes from the size of the family which inevitably grows as years pass.

According to Gersick what is unique about family firms is that they begin with a deep level of trust because the family is a common identifying factor. Shared history, experience, identity, rituals and realities serve as a critical bonding mechanism fostering interpersonal trust.  Interpersonal trust becomes harder to maintain the bigger the family grows. Other kind of trust supporting and complementing elements need to be added. Commonly, trust can be enhanced and complemented by opening the family business system to external experience and knowledge as well as transparent  and up-to-date governance mechanisms and models. (C. Sundaramurthy, Sustaining Trust Within Family Business, 2008)

There seems to be elements and processes whereby trust can be developed and enhanced to embrace the longevity of the family business.  Yet, how to avoid the pitfalls caused by emotional distress, which if not addressed, will have an impact on the success and continuity of the family business?

John Neff has applied the popular framework of emotional intelligence (EI) by Daniel Goleman to family business settings in his article from 2010 (Emotional Intelligence- NOT an Oxymoron in Family Business).

According to Neff, improved social interaction is based on better awareness of self. As long as family members, in-laws, the larger family system understands their roles and impact of own behavior to the surroundings, the easier it is for everybody to interact. Family and business  co-mingle regularly and this requires social competencies from the ones active in the system. Somebody has said that there should be an introductory mingling blueprint for all the becoming in-laws to avoid social shocks at a later stage.

Awareness of social surroundings is another Goleman EI element. The unique aspect of this in family businesses is the process of succession from one generation to next. The owners and managers should have good knowledge and awareness of potential next generation members, who could have the motivation and capabilities to take over one day. Self-awareness can take care of one’s own biases and preferences and social awareness takes care of the alignment to business needs.  Also, the nature of interactions in family businesses has usually a great impact on the perceptions of outside stakeholders. The social climate does tell its own story. Surprisingly enough, it is very common that family businesses prefer other family businesses as customers and partners. The family-business-like-climate is simply similar and easy to live with.

Self-Management is needed in order to minimize or at least handle emotionally charged situations gracefully and constructively. Effective self-management aids to direct the efforts to business and related goals and minimize emotional sabotage. Personal self-control is essential in family businesses. Reduced or non-existing control may lead to hostile relations and avoidance of family members in the long run. Sometimes non-family members can serve as catalysts in conflict situations. However, they do not offer permanent solutions, rather remedies on the short term.

Social skills such as leadership, communication, developing other’s influence, being a catalyst for change, managing conflict, creating bonds, collaboration are all important skills for maintaining effective and healthy organizations. In family businesses these skills are vital as the family members need to manage relationships not only with the business but also within the family. The more skilled family members are socially, the higher is the probability that their interactions are strengthened. The stronger the family is together, the better it can support the non-family executives, employees and board members, for the benefit of the thriving  business.

There is a saying that the biggest driver of success in any family business is communication, communication and communication. The better equipped the family members are emotionally and socially, the easier and natural communication will be for them.

The more you communicate, the stronger becomes the interpersonal trust over the generations and the longer will be your lifespan as a family business.

How aware are you of your emotional intelligence skills?