Building Initial Trust with Family Businesses

Family businesses contribute to almost 70% of the annual GDP of most developed and developing countries. However, they surprisingly remain an underserved target group for the coaching industry worldwide. Unlike present-day startups, family businesses prioritize legacy and longevity over short-term success. This focus informs their long-term vision and their risk-taking ability. Family businesses also tend to nurture long-standing relationships with local communities by promoting job growth, infrastructure development, and resource sharing.  

Nuances and Inherent Challenges

While working with family businesses, coaches must first understand their scale of operations and the stage of professionalization to grasp the nuances of their complex structure. Many family businesses operate at two levels: the visible outer layer, comprising the formal structures and designations like any other professional organization, and the inner layer, often called the invisible organization, emphasizing informal relationship hierarchies over formal designations, where real decision-making takes place.

4 Keys to Building Initial Trust with Family Businesses

1) Discover the Organization’s Pulse and Embody a Learner’s Mindset

In the initial stages of working with a family business, listening and discovering the pulse of the organization is key: the unique aspects of its culture and working style that have contributed to its success. The organizational culture is often shaped by the deeply held values of its founders. Approaching without preconceived ideas and discerning negotiable and non-negotiable elements through deep listening becomes a gateway for trust-building.

Initially, some family members may be hesitant to work with a coach and share confidential and often personal information beyond their trusted circle. Recognizing their core needs is vital. Acknowledging their depth of care and commitment to their organization, their concerns, vulnerability, and desire to preserve certain practices that have contributed to the success of the organization is an important step in discovering and embodying an approach that facilitates trust.

This initial phase requires patience, curiosity, a learner’s mindset, and a willingness to be truly open to discovering new ways of being and doing that have contributed to their entrepreneurial success. Coaches must also be comfortable with ambiguity and uncertainty. Many of the rules and processes that are routinely followed in corporations may not apply here. Initially, senior and key decision-makers may be reluctant to receive coaching themselves. In your initial interactions with these leaders, finding and harvesting any possible coaching moments become a powerful doorway for them to experience the power of coaching, thought partnership, and support, gradually creating openness to receiving coaching themselves.

2) Balance Power with Love

“Power without love is reckless and abusive, and love without power is sentimental and anemic.” ― Martin Luther King Jr. 

According to scholar Adam Kahane, balancing power and love is critical for effective leadership. Finding this balance in a family business, where relationships are at the core of both personal happiness and business success, is more challenging and rewarding. “Love without power” could manifest as placing a poorly suited family member in a critical role, refraining from speaking up or sharing innovative ideas, and avoiding direct communication to prevent offending certain family members. “Power without love” could translate to certain family members making unilateral decisions and one-way communication dominating the organization. Learning to balance and embody these energies of power and love and supporting leaders to do the same is vital to successful interventions. This could further translate into enabling leaders to discover a balance between instituting new processes and systems and retaining the unique selling propositions of the family business, establishing open communication channels for conflict resolution, and enabling democratic innovation.

3) Serve with the Whole

Given the intricacies of relationships, coaches may easily be swayed by a single perspective. Seeing the whole picture and not becoming biased by a single viewpoint is very important for working with a family business. Understanding how relationships contribute to organizational success or how relationship tension creates power centers that impact organizational culture is core to being able to serve both the leader and the organization. Recognizing both the pulse of the organization (the big picture) and the individual members’ needs, motivations, and priorities (the parts) is fundamental to facilitating growth. To maintain a balanced perspective, working with a co-coach or getting supervision from more experienced coaches is recommended.

4) Honor the Old Guard

Many family businesses have employees who have been with them for decades, embodying the DNA, history, and core values of the business. As coaches, it is vital to comprehend and acknowledge their contributions and not view them as incompetent in adapting to change, It is an important step to building trust. Recognizing these employees and being willing to partner with them and the leadership to help them upskill to meet the organization’s changing needs or create special roles to honor their contribution is a core impact a coach can make.

Family businesses present a huge opportunity for organizational coaching. While these were some introductory points for coaches to build initial trust with family businesses, with more experience, curiosity, and focused learning, professional coaches can develop the necessary skills to navigate the inherent challenges in serving their needs.

Shruti Sonthalia and RuhCo Private Limited

The content in this article was explored in depth at ICF Converge 2023. Even if you did not attend, you do not have to miss out. You can access the corresponding session recording, “Coaching Family Businesses: Building Trust and Successful Interventions,” as well as 60 other recordings from the event with the ICF Converge 2023 On-Demand Package.