Confronting Entitlement in Family Businesses
Discover the common and destructive behaviors of entitlement in a family business. This episode reveals a real-life story of a leader who believed his name alone commanded respect, causing chaos and undermining his siblings. Learn how a direct conversation can be the first step in addressing these behaviors, creating a path for true leadership and mutual respect.
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Family Business Entitlement: Learning Your Seat at the Table
A common challenge in family companies is the belief that a shared last name automatically grants special status, authority, or immunity from the rules. This mindset, which we call business entitlement, often becomes the source of deep family business conflict. Business entitlement isn't just a personal issue; it actively undermines the organization's structure and success.
At Revela, we believe that business leadership isn't inherited—it's earned through professional competence and dedication to workplace accountability. On a recent episode of our Leadership Hustle podcast, Michelle Hill and Andrea Fredrickson discussed a situation involving a family member who truly believed that his name on the building entitled him to special privileges and unchallenged authority. They discussed how this alarming display of business entitlement became the catalyst for internal damage and how necessary the process of restoring trust in the workplace is.
The Shock of Business Entitlement
The spark for this discussion came from a real-life phrase heard while Fredrickson was working with a family business. It was a moment that required summoning all professional composure. The phrase, delivered by a family member in a leadership role, was, "I don't know why they don't listen to me. My name is literally on the building."
As Hill noted, witnessing that kind of brazen business entitlement would make it hard to hold back. Fredrickson's immediate concern, however, was the impact. This individual, a son in the business, genuinely didn't understand the damage he was doing to his family and the entire employee base.
He saw his actions as driving efficiency, while everyone else experienced chaos. This core issue of entitlement creates an invisible wall that halts progress and poisons trust in the workplace.
Defining Family Business Entitlement
The issue of business entitlement doesn't just appear out of nowhere; it's rooted in a fundamental confusion between kinship and competency. To effectively resolve the inevitable family business conflict that arises from this behavior, we must clearly define what this entitled mindset looks like and how it deviates from the professional standards of workplace accountability.
The Entitled Mindset
Entitlement issues in a business context are rooted in the belief that kinship provides inherent authority, respect, and privileges not afforded to others. This creates a separate set of rules for the family member—rules that, in their mind, are justified simply by their DNA. They feel they don't have to earn their position because it's been granted by birth.
Behavioral Manifestations (The "Tell-Tale Signs")
Our experience at Revela shows that this mindset manifests in specific, disruptive actions that create chaos and destroy morale. These behaviors consistently undermine the organizational structure and signal to non-family employees that merit and hard work don't matter. The tell-tale signs of entitlement issues include:
Making random changes without consulting the management team or co-owners.
Using the family name (e.g., "I'm a Frederickson") as the sole justification for a decision, instead of professional reasoning or strategy. This reliance on the "bloodline" instead of the role explains everything in their mind and severely impedes sound business leadership.
Demonstrating poor workplace accountability by coming and going as they please, or skipping critical meetings only to later overrule decisions made in their absence. This shows a profound lack of respect for their colleagues’ time and commitment.
Demanding compliance ("just do it because I told you to") without having earned trust in the workplace through consistent, competent behavior.
The Devastating Impact on the Business and Family
The entitled family member's behavior doesn't just annoy people. It actively corrodes the business's operational integrity and the family's relationships.
Impact on Trust and Employees
Entitlement issues destroy trust in the workplace. When an employee is forced to follow a directive based only on a last name, they lose faith in the system. They’ll waste time double-checking decisions or actively distrust the entitled family member's instructions because they fear the next arbitrary reversal. This creates an environment where staff believe decisions are arbitrary or based on favor, not sound business leadership. The result: less gets done, and the stress is carried by everyone else.
Impact on Siblings/Co-Owners
For the siblings, there's immense tension and resentment. This is where the family business conflict festers. The brothers in our scenario had reached a point where they couldn't move forward because they could see the behavior, but it had never been said out loud. The family business conflict, rooted in business entitlement, acts as a classic roadblock, preventing the family from achieving success until those issues are addressed openly.
The Sibling Shadow
A particularly damaging consequence of entitlement issues is the sibling shadow. The poor behavior of one entitled sibling creates a negative bias against all subsequent family members who enter the business.
As Hill warned, any younger sibling who follows, even if they are professional and hard-working, will be viewed with suspicion. She stated, employees will automatically be "...keeping score against you because of your sibling that has the same last name," forcing them to work twice as hard to earn basic trust in the workplace.
Moving from Entitlement to Accountability
Positive change is possible, but it rarely happens without external intervention and internal commitment. When a family has historically failed to address entitlement issues internally, an outside party is often the catalyst for change, especially at the request of the next generation seeking viable family business succession.
Establishing Boundaries and Expectations
The key to overcoming business entitlement is implementing a formal structure that applies to everyone. We worked with the family to:
Develop and clearly document a set of professional behaviors and expectations that apply equally to everyone, including family. This moves the conversation from "how we treat each other as brothers" to "how we behave as executives."
Align the company's business mission with a common family mission that emphasizes professional standards. This helps the family understand that the enterprise's success is paramount.
The Power of Workplace Accountability
The greatest hurdle is workplace accountability. We needed the brothers to hold each other to the new standards, which meant the current generation in charge (Gen 1) had to step back. They could observe, but Fredrickson said, "...they could not make any comments because the comments would be viewed as siding."
The brothers had to learn to have conversations that were "...graceful and accountable at the same time," as Fredrickson said. They needed to define clear consequences when expectations are not met, moving beyond emotional "sibling dialogue" to professional HR standards.
This process took time, but the brother's business entitlement was a "blind spot." Once he understood the negative impact—especially on the employees—he committed to the hard work. He had to earn trust with all of the employees, and he started this by asking for workplace accountability from his employees and his brothers.
Earning Your Place
True business leadership requires more than a last name. It demands consistent workplace accountability and a willingness to confront entitlement issues. We saw a son transition from relying on business entitlement to earning genuine respect, proving that positive change is absolutely possible when the impact of conflict is understood and a better future is desired. If you recognize these patterns in your organization, the time to define your professional boundaries is now!
At Revela, we believe tough conversations are key to sustained growth and family business succession. Listen to the rest of our Leadership Hustle podcast for more help on navigating complex issues and strengthening your company's foundation!
About the Hosts
Andrea Fredrickson
Andrea Fredrickson is a thought leader and consultant at Revela, an organization based in Omaha, Nebraska specializing in the development of leaders, culture alignment, and business strategy for private and family businesses of all sizes. Revela is one of the region's most experienced thought challengers, helping individuals and companies find their greatness. Andrea has built an amazing team by believing that fundamentally people want to be successful and become better versions of themselves.
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Andrea has degrees in education, management, and business. She is the author of Insight Unseen; How to lead with 20/20 business vision. She helps people see things differently, self-reflect, and never stop looking for ways to improve themselves on a personal and professional level. Andrea has spent more than 30 years researching and developing methods to help people communicate and lead more effectively.
When Andrea isn’t working with clients, you’ll find her spending time with her family & friends and making memories by exploring new cities.
Michelle Hill
Michelle Hill is a master facilitator and coach at Revela, an organization specializing in the development of leaders and aligning the culture of privately held and family businesses of all sizes. Revela is one of the region's most experienced thought challengers, helping individuals and companies find their greatness.
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An ambitious leader, Michelle has the natural ability to create forward momentum to build teams and get results. She inspires others to look within themselves and to challenge the status quo. She helps create high-performing environments. Michelle brings a diverse background: operations, employee development, and sales in the steel, hospitality, and consulting industries.
Outside of work, you will see her competitive side engaged in her daughter’s sports and ISU athletics. She loves life, her four-legged companions, and captures all the moments through her camera’s lens.
TRANSCRIPT
Andrea Fredrickson: On this episode of The Leadership Hustle, we're going to discuss what it's like to have a family member who believes that their name being on the building, gives them special privileges. Hello and welcome to the Leadership Hustle for executives whose companies are growing fast and need leaders who are ready. Welcome to this episode of The Leadership Hustle. I'm Andrea Frederickson, and I'm joined by my co-host, Michelle. Hello. Hi there. And we are wrapping up a series of, um. Well, maybe not really wrapping up. No, no, we're not wrapping.
Michelle Hill: Oh, I didn't know we were wrapping them up, but.
Andrea Fredrickson: We're doing, um, one of the things we decided we should do while back was to insert some episodes related to family business. And today's episode is that episode that we're sprinkling in. And literally, this is exactly the phrase that came to I was working with a group of people, and this was actually said, and I just wanted to everything I could do not to let my jaw drop on the floor. And the phrase was, I don't know why they don't listen to me. My name is literally on the building. And the other.