TM2 Flashcards
(11 cards)
What does the Three-Circle Model represent?
It visualizes the overlap of three subsystems in a family business:
* Family (relationships, roles)
* Ownership (control, shares)
* Management (day-to-day operations).
Insight: The overlapping areas create complexity (e.g., family-owner-employees).
Seven Roles in the Three-Circle Model
- Family members (no shares, no job).
- Owners (non-family, non-managers).
- Employees (non-family, non-owners).
- Family-Owners (no management role).
- Owner-Employees (non-family managers with shares).
- Family-Employees (family in management, no shares).
- Family-Owner-Employees (all three roles).
How can role overlap cause conflict?
Circumstantial: Mom (family role) critiques son’s work (manager role) at dinner.
Interest: Owner wants dividends; manager wants reinvestment.
**Values: **Traditionalist founder vs. innovator successor.
Contrast family-oriented and business-oriented goals.
Family: Harmony, legacy, employment for relatives.
Business: Profit, growth, stakeholder satisfaction.
Conflict Example: Paying family members high salaries (family goal) may reduce profits (business goal).
What psychological needs drive family members?
- Self-esteem (pride in the business).
- Continuity (connection to past/future).
- Distinctiveness (unique family identity).
- Meaning (purpose through the business).
What are the key relationships in family firms?
- Couple (e.g., founders).
- Sibling (e.g., rivalry or partnership).
- Parent-Child (e.g., succession tension).
- In-Law (e.g., conflicts over inheritance).
Name the 4 toxic behaviors that harm family firms.
- Criticism (attacking character).
- Defensiveness (denying responsibility).
- Stonewalling (avoiding conflict).
- Contempt (disrespect, sarcasm).
How do sibling relationships affect the business?
- Harmonious: High warmth, low conflict (best for business).
- Affect-Intense: High warmth + high hostility (unstable).
- Uninvolved: Low warmth, low hostility (disengaged)
- Hostile
How do parenting styles impact successors?
- Authoritative (high warmth + high control): Best for independent successors.
- Authoritarian (low warmth + high control): Obedient but less creative.
- Permissive (high warmth + low control): Entitled successors.
- Uninvolved (low warmth + low control): Disengaged successors.
How can families reduce complexity?
- Pruning: Limit ownership to committed branches.
- Formalize governance (e.g., family councils).
- Clarify roles (separate family vs. business discussions).
What is a family genogram used for?
Is a: visual diagram (like a family tree) mapping biological/legal relationships, roles in the business, and emotional dynamics (e.g., conflicts, alliances).
Used for:
* Reveal hidden dynamics affecting the business.
* Map family structure and relationships.
* Identify patterns (e.g., conflicts, leadership transitions).
* Plan interventions (e.g., succession, governance).
Includes:
* Names, birth/death dates
* Roles in the business
* Emotional ties
* Marriages, divorces, adopt..
* Generatioanl transitions
