Business Owner Disputes

Sometimes business owner disputes become “business divorces.” Business owner disputes are toxic to the sustainability of a private business. As with any other relationship such as friendship or marriage, it is common and human nature to experience conflict within the relationship of business owners. How does the conflict escalate to a dispute? How does the dispute escalate to the sudden end of the relationship?

My experience with business owners is that disputes start with assumptions. Many owners will assume that because other owners are in the same business with somewhat similar experiences that they share the same values. Because people usually do not have conversations about their values, often whatever assumptions owners have made about one another go unchallenged until the day comes that the assumption is proved false. At this time the holder of the assumption feels a sense of betrayal, even though there has not been any expressed misrepresentation. Often this feeling of betrayal goes unstated, and things tend to worsen until feelings are declared with emotion and little empathy. Both parties feel wronged and the polarization increases.

The definition of a "value" is elusive. A value is a normative principle that informs and shapes thoughts, desires, feelings, choices, and behavior. A value is not a preference, but an enduring and essential attribute of character. The following are words describing commonly-held values and examples of words describing attributes within that value: integrity – honesty, sincerity, authenticity, dependability, stewardship, and personal responsibility; security – self-reliance, self-determination, self-actualization, prudence, health, education, comfort, acceptance, power, and prestige; and beneficence – philanthropy, gratitude, respect, tolerance, generosity, compassion, service, and justice.

People sometimes talk about values as though they possess them. Most owners are only vaguely aware of the standards and concerns that compose their personal value systems and give little thought to the dynamic and elusive nature of value systems. Most unthinkingly embrace an array of normative standards to which they assume most caring and intelligent people adhere. Few have consciously attempted to resolve the tension that inevitably arises when those standards and concerns conflict. Resolution is especially difficult if the value conflict emanates from a business partner.

Business owners should articulate their values to one another. The value concepts related to self, family, faith, security, and satisfaction are all wrapped around the conduct of the business. Owners do not have to have the same values to have an enduring relationship, but they will not have a lasting relationship if they assume they have the same values. For each owner, values provide the answers for very specific business questions. How much time do I spend with the business? How long will I want to be involved with the business? How do I want the business to change?

If an owner’s value system is to serve effectively as the framework for the formulation of the business plan, the owner must first clarify and prioritize its components. To bring clarity and order to the owner’s personal value system, the owner should reflect on the circumstances and experiences that have informed and shaped the owner’s hopes, fears, and perspectives. The product of this reflection should be memorialized in writing. The writing should be reviewed and altered from time to time to reflect changing circumstances and perspectives. This done, the owner will better be able to articulate values. To articulate a value it does little to name the value. To say that you possess loyalty as a value conveys a feeling. To say that it would be disloyal to leave the business in less than five years is specific and significant. For someone to say that they are honest conveys only general intent. To say that it would be dishonest to fail to disclose a material fact of financial information is specific and significant.

In the mush that passes for conversation, owners often do not converse about important issues. Owners need to have difficult conversations among them to articulate their values in specific terms. Since there is nothing more corrosive to a relationship than keeping a secret, this needs to happen frequently and in good faith. This is the essential base for strategic planning. Once a plan is in effect, stress test it. See https://btcllc.net/frequently-asked-questions/102-how-do-i-know-if-my-existing-plan-will-work

Owners who are aware of other owners’ values and needs will be more likely to be empathetic and willing to have planning address those needs. Even if the conflicts cannot be immediately resolved, the conflicts will not arise suddenly to thwart other business endeavors. Managing conflicts over time by implementing planning to accomplish a solution will prevent the traumatic ending of a business relationship.