Post titleConflicting Hierarchies In Family Firms - Part 1

Friday 10 August, 2001

by George Tanewski

The daughter or younger son who becomes head of the family business must struggle with both self-identity and changing family role expectations. In a sense, these problems of ambivalence, rivalry, and self-esteem arise because of two conflicting or incongruent hierarchies.

One hierarchy reflects the individual’s position within the family. That is, daughters and younger sons tend to rank lower than older and eldest sons. The other hierarchy represents the individual’s position within the business. The higher the position, the better it is. When for one reason or another a daughter or younger son becomes the chief executive, the incongruence is obvious, and the two status structures conflict.

This series of articles explores the tensions that arise from these conflicting hierarchies and the ways in which daughters and younger sons try to reshape their own identities and force the reshaping of other people’s expectations. Life cycle concepts will be used as a metaphor to demonstrate how family relationships can be restructured.

Traditional Succession Patterns

Hierarchical incongruence or conflict can lead to family stress that becomes even more painful when older siblings are actively involved in the business. Although the patterns for daughters differ somewhat from the patterns of younger sons, confusion and ambivalence can reign in both cases. Family members and outsiders do not know which hierarchy to respond to or to rank higher. Is the daughter or younger son to be treated as the head of the business or as the lesser of family members?

Throughout human history, parents have traditionally used hierarchy and primogeniture to set the rules for younger generation succession. The prevailing assumption is that eldest or only sons are first in line. They should take on the major family obligations and responsibilities. This assumption tends to hold true in both kingdoms and commerce. However, such assumptions do not always work out, particularly in the business environment. Eldest sons do not necessarily succeed as CEOs. Sometimes they cannot even assume the CEO position until a dominant father dies. Father-son rivalries and tensions can run high.

Conclusion

Failure stories usually involve a father who is unable or unwilling to give up power and an eldest son who is unable to take power. The son’s continuing dependency damages his own sense of self-esteem. But, his frustrated struggles to become his own man may also threaten the father. The son’s succession may spell the father’s obsolescence and irrelevance. Such struggles often end in son’s abandoning the family business until after the dominant father dies. It seems little wonder that only 30 percent of first-generation family businesses remain under family control during the second generation.

This article has been extracted and modified from Barnes, L.B. (1994). Incongruent hierarchies: Daughter and younger sons as company CEOs. In Beckhard, R. (ed.) "The Best of Family Business Review: A Celebration". Boston: Family Firm Institute. 

Source:ceoonline.com