At the risk of stating the obvious, effective communication is the life blood of any successful family business.

Having worked with many family businesses, we cannot stress enough that good communication is paramount for the success of the business and the wellbeing of the family.

The importance of communication is often overlooked due to the fact that it is something deemed to be mundane, trivial and/or taken for granted, but in a family business context it is imperative that you communicate well with others to minimize the risk of conflict

More often than not, people don’t perceive communication to be a necessary component in their business.  This is most alarming, as good communication is intrinsic to risk management, after all you can’t really discuss your collective vision/mission, individual ambitions, and expectations of each person if you can’t communicate effectively.

Take the analogy of driving; roads in essence are a social environment, and through our cars we can communicate our intentions, aims, emotions etc. whilst trying to reach a certain destination.  Most drivers, even those with very basic skills and knowledge can get by on the roads, but those with poor driving abilities who are oblivious to their surroundings pose a real threat to others.  Such threats range from having to take sudden and unplanned action to avoid collision to actual impacts and serious, sometimes fatal, accidents.  Road accidents have several causes of course, but poor communication is one of them, due either to the lack thereof, or the inability to ‘read’ other drivers.  Even a minor accident can cause severe delays in reaching one’s destination, or require a diversion onto a less direct or less convenient route. Alternatively they can be fatal, causing a road user to fail to reach his destination at all.

Either way, we try hard to avoid accidents; we train our children to cross roads, and drive safely and considerately, we implement rules which all drivers must abide by, and we design safety mechanisms to safeguard ourselves, our cars and other road users. Roads and intersections are also built with safety and maneuverability in mind to try and reduce the risk of accidents.

The same should go for communication in a family business and as such we encourage our clients to introduce all the necessary measures to enable and facilitate good communication.  Commercial imperatives derailed by conflict or mis-communication may not just result in a delay to projects or decisions, but could also impact on the business’s bottom line.

Communication skill building should be one of the top priorities in a family business.  Just as we ensure our new drivers take lessons before driving a car alone, it is not unreasonable to provide guidelines to help people learn how to communicate better.  Unfortunately, all too often families fall into poor communication habits that can negatively impact their business, its financial results and ultimately its long-term success.

In our experience, a good starting point for dealing with the challenge of getting communication right is to recognize that the family and business are two separate entities.  Fundamentally, conversations that may be appropriate around a family dining table are not appropriate around a boardroom table. Likewise, the rights, obligations and responsibilities granted to the shareholders and family members in such capacities differ, and should be dealt with accordingly.

As such, the family, management and ownership spheres should each have their own rules of communication that are understood and respected by all. Once this system of rules is recognized and put into practice and the results of the ensuing communication and reporting are realised, you alleviate one of the greatest strains on the family business; that is, ineffective communication.

Of course that is not to say there are no other communication problems in a family business, and this may seem like a simplistic approach, however as Gibran Khalil Gibran said, “The obvious is that which is never seen until someone expresses it simply.”

By Yasmine Omari, Manager, Family Enterprise Consulting, Deloitte Middle East

The views and opinions expressed herein do not represent nor reflect those of Deloitte. Deloitte shall endeavor, as reasonably as possible, to screen such information which is obtained, to the best of Deloitte’s knowledge, from reliable source. As such, Deloitte cannot guarantee the accuracy of the information featured nor the validity of the opinions and/or analysis and interpretation expressed herein. Opinions, conclusions and other information in this interview/article which have not been delivered by way of the business of Deloitte are neither given nor endorsed by it.

This article contains general information only, and neither DTME, DTME affiliates nor any of Deloitte Touche Tohmatsu Limited member firms are, by means of this article, rendering any accounting, business, financial, investment, legal, tax, or other professional advice or services of any nature whatsoever. Information included in the article is not a substitute for such professional advice or services, nor should it be used as a basis for any decision or action that may affect your finances or your business. Before making any decision or taking any action that may affect your finances or your business, you should consult a qualified professional adviser. None of Deloitte Touche Tohmatsu Limited, its member firms, or its respective affiliates shall be responsible for any loss or damages whatsoever sustained by any person who relies on this publication.