Grief, Conflict, and Transparency in Family Business: How Family Dynamics Affect the Success of Outside Executives

A conversation with Natalie McVeigh, Founder, Oikonomia Advisory, and Bill Stranberg, Managing Partner, Stranberg

It’s natural for family businesses to walk into a senior executive search focused on the role. They look at the scope, the compensation, and the candidate slate, but are typically critically underprepared for what the hire will bring to light within the family itself. This month's conversation focuses on that gap. Bill Stranberg and Natalie McVeigh share five things that stand out as the ones families most often miss:

• Limits of an executive's authority

• Risk of leaning on employees to broker family disputes

• Effect of grief on timing

• Double standards built into how family is treated at work

• Transparency a candidate deserves before signing on

Why an Outside Hire Can't Absorb Family Conflict

When family owners split into factions, each side often hopes a new president or CFO will validate the direction they want the business to take. Executives, no matter how talented, don't carry the same weight in a family as an owner does. They typically hold no equity, little influence over shareholders, and no real authority to overrule the family that hired them.

Stranberg's related point is about mandate. A non-family executive needs explicit authority from ownership to do the job, and the family has to protect that mandate once it's granted. The moment a family overrides its own hire to shield a family member from a decision that hire is authorized to make, the executive's authority erodes with the rest of the team, and turnover follows.

Facilitation Isn't a Job Description

McVeigh described a case involving two siblings who were 50/50 owners. One of them wanted a new hire, in part, to “stop me from having to talk to my sibling.” McVeigh's response was direct: no executive, however capable, can substitute for two owners who need to talk. The resolution was to be explicit with the incoming executive about the tension that existed before he signed on. Years later, McVeigh reports, the arrangement is still working.

Stranberg raised a related risk: families often lean on a trusted, longtime employee to broker disagreements between owners because that employee is close to the family. But a paid employee has a stake in their own job and often a closer relationship to one side of the family than to the other. This rules out the neutrality real facilitation requires.

Grief in a Family Business Resets the Clock on Hiring Decisions

Grief moves through roughly eight, nonlinear stages, McVeigh explained. It can take a year or more, and every family member processes it differently. Her standing advice to clients is not to make major decisions while grieving. That doesn't rule out leadership continuity, but it may mean an interim leader, a promoted internal candidate, or the plan the founder left in a drawer, honored for now rather than reopened for debate. Siblings may each remember a different version of what their parent wanted.

Stranberg described a pattern he has seen firsthand. When a founder passes away, the company may cycle through three presidents in five years, and the founder's office sits untouched. The family hasn't done the work of separating the person from the business, and the adult children still running it haven't developed their own leadership identity. McVeigh's guidance is to place the legacy on a spectrum with innovation. The photos can move to the boardroom while the office itself makes room for whoever leads next.

“When we do a carbon copy leader, what we usually get in businesses is maintenance. We don't get future growth.”

— Natalie McVeigh

The Most Common Family Business Double Standard

Most family businesses eventually talk about a family employment policy. McVeigh pushes clients past the easy items, like a company phone or car, into the harder ones: shorter workdays, more vacation, and, most consequential of all, an absence of feedback. Family members are frequently never placed on a performance plan and never formally written up, sometimes for generations. McVeigh asks, “What would you do if this were your GM, not your son?”

She sees the same gap appear at varying intensities across a company. Lighter for regular employees, heavier for the owner's children, and heaviest of all for siblings. Withheld feedback is a habit the owner models for the whole organization to follow. That habit becomes the incoming executive's problem the moment the family asks that executive to finally enforce standards no one else has enforced in years.

Radical Transparency Protects the Hire You Make

Stranberg closed the conversation on a question every family business should ask itself before extending an offer: what does the candidate actually need to know? Not the person clicking “Easy Apply,” but the person the family is genuinely courting. His view is that radical transparency about the business's true state is necessary, because an incoming executive will discover what the family tried to keep under the rug regardless.

Frequently Asked Questions

Can hiring an outside executive resolve conflict between family owners?

No. An executive without equity or ownership standing typically lacks the authority to settle disputes among family shareholders, and using a hired referee to resolve that conflict puts both the business and the executive at risk.

Why is it risky to ask a family employee to mediate between owners?

A paid employee has a stake in their job security and often a closer relationship with one side of the family than the other, which undermines the neutrality real facilitation requires.

Should a family business hire a permanent replacement soon after a family leader's death?

Most advisors recommend an interim or fractional leader first. Major hiring decisions made during active grief tend to be driven by loyalty to the person who was lost rather than by what the business actually needs going forward.

What is a family employment policy, and why does it matter to a hire?

It's a documented set of expectations for how family members are treated as employees, like vacation, schedule, feedback, and performance standards. Without one, an incoming executive inherits double standards they didn't create and can't enforce on their own.

How much should a candidate know about family conflict before accepting an executive role?

As much as the family can responsibly share. Candidates who understand the real dynamics before they sign are far more likely to stay and succeed than those who discover the truth after starting.

What's the first step for a family business dealing with a double standard around family members' behavior?

Naming it. Most owners assume family members are treated the same as everyone else; a closer look at feedback, discipline, and accountability standards usually tells a different story.

About the Authors

Bill Stranberg

Bill Stranberg is Managing Partner at Stranberg, a boutique family enterprise executive search and succession advisory firm. He works with family business owners and their professional advisors on CEO succession, executive search, leadership transition, and governance.

Contact

Email - bills@stranberg.com

Natalie McVeigh

Natalie is a Family Enterprise Advisor with an extensive coaching and mediation background, founding Oikonomia Advisory. She is a Master Neuroplastician (M.npn), specialising in Conversational Intelligence (C-IQ).  Natalie serves Fellow and Faculty of the Family Firm Institute, serves on the Purposeful Planning Institute’s Education Development Committee, is the Director of Research and Development at Aspen Family Business Group, Faculty of the FBA Accreditation Program through the University of Adelaide, and a Trust and Estate Practitioner (TEP) through STEP.  Natalie is a Certified Happiness Trainer and is an entrepreneurial and executive coach.

Contact

Email - natalie@oikonomia.group

Website - https://oikonomia.group/