It's a common story, experts claim. A son or daughter returns to the family farm. Not large enough to support everyone, the parents take on new debt to expand the farm so the next generation can stay and be supported. Business takes a bad turn, and the son or daughter leaves for a more stable job. Now the almost-retired parents are stuck with debt they didn't have before and no way to pay for it.

Conflict can arise in family businesses, like this example, because of different personal goals of family members, money issues, lifestyle choices and a number of other things. If conflict isn't resolved early on and in the right way, families and businesses can be torn apart.

That's why conflict management is so important in a family farming operation. “I've seen quite a few instances where two-generation farming operations have broken up because of the inability of parents and children to get along,” says Don Hofstrand, Iowa State University Extension farm management specialist.

But it's not all negative, Hofstrand points out. “In many ways, there's nothing wrong with conflict. The key is how we deal with it,” he says. “We do have different values and ideas of how things should be done, so conflict can actually be good if it's handled in a non-emotional, up-front manner.”

Differing personality types are a major cause of conflict among families. “This is something I see in almost every family,” says Don Tyler, a management coach and founder of Tyler & Associates, Clarks Hill, IN. “Their personality types, when they have to share leadership and management, often get in the way.”

Hofstrand agrees, and says personality profile exercises can be helpful for people in understanding other points of view. “One mistake we make is thinking that everybody thinks like we do, and that's not true,” he says.

Tests like the Myers-Briggs Type Indicator and the Thomas-Kilmann Conflict Mode Instrument can be used as ways to show family members why conflict might arise because people approach things differently depending on their personality.

In many business settings, and even in everyday life, people often take positions rather than focusing on what the actual interest is in a situation. Both parties in a conflict may want the same thing, but take a different position on how it should be done. This can hurt a business and slow conflict management.

Dan Arbach, an organizational effectiveness consultant, St. Paul, MN, says when in conflict, those involved can benefit from stepping back and asking, “By taking this position, what am I really trying to get at? What am I trying to accomplish? In a sense, what is my ‘interest’ in this position?”

Looking at and understanding the bigger picture — your interest — makes it more likely you'll collaborate on a solution that results in a win-win. Both parties are equally satisfied and have given up nothing.

Another problem families often face is the inability of parents or other family members to treat others in the operation as adults. Conflicts often crop up that have roots all the way back to someone's childhood.

“That's a challenge you run into when you mix family and business, and family has been there all along,” says Tyler. “The successful family businesses know when to allow someone to no longer be a child, but to be an adult business person.”

In a parent/child relationship, the inability to pass responsibility to the next generation can cause problems. Tyler relates a story about a family in which the father was essentially running the business from his hospital bed rather than sharing information and allowing his children to take over management. If the next generation family members feel like they don't have any power and are still being treated like children, it could drive them away.

“The right way for bringing a child back into the business is to allow that child to develop his or her management and decision-making skills,” says Hofstrand. “And the only way to do that is by giving them the authority to make the decisions and then live with the consequences.” This can also help ensure the operation will continue to run after the parents are gone.

While there are many causes for conflict, especially within a family operation, there are also many ways to avoid or resolve conflict in a healthy way.

Tyler's first tip for families is to learn to have business meetings, and the second is to learn to talk about the issues that nobody wants to talk about.

He says that families need to set up regular business meetings and hold them at the same time each month or week. They also need to come with a set agenda that goes in the same order each time. This way, everybody knows when they're supposed to report and can also be responsible for everything said at the meeting.

“The thing that upsets family business meetings,” he says, “is when you've got someone that comes into the meeting armed and ready to talk about something. If there isn't an agenda, they aren't paying attention to anything else until their issue is on the table.”

Having an agenda focuses the meeting and fosters rational decision making. Tyler also says there should be ground rules for meetings, including things like “no personal attacks,” “one person talks at a time” and “nobody walks out.”

Hofstrand suggests developing a vision of what you'd like your business to be in five, 10 or 20 years — and then keep an eye on that vision when making decisions.

“Keep reminding yourself that ‘this is what I want to accomplish,’” he says. “Will picking a fight with your brother help accomplish this? Probably not. So it tends to trivialize little family conflicts that can become so big.”

Separating personal from business issues is important in avoiding or resolving conflict. While it's difficult for farm families because their office is usually their home, making sure to bring up business discussions at the appropriate time and focusing on the objective rather than subjective things surrounding decisions can help.

“The farm family needs to get up in the morning and go through normal morning routines. Then, when it's time to work, separate themselves from that by ‘stepping into the office,’” says Arbach. If families don't have a separate office area within their home, he says to consider establishing one. A change of location can underscore the difference between family and business matters.

Tips for conflict resolution may seem basic, but when you're in the middle of a family conflict it can be hard to look outside the situation. Family businesses can turn to mediators or Extension offices to get some outside help if they need it.

“The advantage that an Extension agent or other person with those types of skills has is they come in as an unbiased third party with no special attachment to one side or the other,” says Hofstrand.

Families should work hard on open communication and good working relationships, and deal with conflict early on so it doesn't cause problems in later decisions. When dealt with in the right way, conflict can produce positive change in a business by bringing together different viewpoints.

Handling Conflict

These are tips from experts on ways to deal with conflict.

  • Separate your position from your interest. Look at what you really want out of a situation.

  • Keep family and business issues separate. Don't bring up family business on Saturday night in the living room.

  • Understand different personality styles. When you realize that not everyone thinks the same, it's easier to understand another person's viewpoint.

  • Hold regular meetings with a set agenda — and don't forget ground rules. This can keep a family focused on important decisions.

  • Bring up the things nobody wants to talk about. It's important to work them out before they cause bigger problems.

  • Develop a vision for your business, and “keep your eye on the prize.” This helps put more trivial conflicts into perspective so decisions are based on what you want your business to accomplish.

Conflict Resources

Here are a few resources that can help you deal with conflict.

  • Don Tyler, management coach and adviser, can provide outlines of sample ground rules and meeting agendas, as well as other topics. Tyler can be reached at don@dontyler.com.

  • Iowa State University Extension's Ag Decision Maker Web site — www.extension.iastate.edu/agdm. The “Transfer” link on the left side of this page offers a variety of information on the topic.

  • Your local Extension service. Farm management field specialists can often help mediate conflict in a business.
  • The Coalition of Agricultural Mediation Programs — http://agecon.nmsu.edu/mediation/CAMP.htm. This site directs you to mediation programs in your state.

  • Workshops. Purdue offers the Farming Together Workshop each year, the next being held Jan. 26-27, 2007. The workshop helps families get started on the right foot when working together.