Welcome to another episode of Family Business Makes No Sense, where we explore why mixing a family with a business almost guarantees conflict — and what you can do to prevent or resolve it.
As the attached document puts it:
“By putting a family and a business together, you’re inevitably going to create conflict at some stage along the line.”
Today’s topic is one of the most important — and one of the most misunderstood — causes of conflict:
Cause #11: Emotional Intelligence (or the Lack of It)
Emotional intelligence (EQ) is the engine room of human behaviour. When EQ is low — especially in a family business — conflict is inevitable. When EQ is high, families and businesses thrive.
This episode explores:
- what emotional intelligence is
- why it matters
- how low EQ creates conflict
- how to resolve EQ‑driven conflict
- how to build EQ in your family and business
Why Emotional Intelligence Matters in Family Business
I’m John Kenfield, the Family Business Solutionist, broadcasting from Melbourne, Australia. After decades working with business families, one truth is unavoidable:
“The vast majority of family conflicts are not primarily about money… they are about a lack of sense of fairness… relationship issues… personal behavioural issues.”
Money is usually just the presenting issue. The real causes lie deeper — in emotions, perceptions, and relationships.
That’s why empathic problem solving is almost always more effective than:
- legal threats
- rational arguments
- emotional blackmail
EQ is the foundation of that empathic approach.
What Emotional Intelligence Actually Is
Daniel Goleman’s work breaks EQ into five core abilities. The attached document summarises them:
“We’re talking about the ability to recognize and manage our own emotions, to recognize and respond appropriately to the emotions of others, and to build meaningful relationships.”
Here are the five components:
1. Self‑Knowledge
Understanding your emotional makeup, behavioural preferences, triggers, and blind spots.
The document notes:
“Many business owners… really don’t know themselves that well.”
This leads to poor decisions, poor leadership, and poor relationships.
2. Self‑Management
Regulating your emotions so they don’t hijack your behaviour.
Without self‑management:
- anger erupts
- fear dominates
- ego takes over
- conflict escalates
3. Empathy
Understanding how others feel, why they feel it, and how your behaviour affects them.
“Empathy is the ability to put yourself in another person’s shoes… and walk 10 miles in those shoes.”
Without empathy, leaders misread their team, misunderstand their family, and mismanage conflict.
4. Social Skills
Building healthy, resilient relationships — and sustaining them through adversity.
Low social skills = low trust, low collaboration, low performance.
5. Motivation & Resilience
Inner strength, purpose, and the ability to bounce back from setbacks.
Without resilience, leaders become brittle, defensive, and reactive.
How Low EQ Creates Conflict
Low EQ environments are toxic. The attached document explains:
“We are going to have a low trust environment… low collaboration… poor teamwork… reduced performance.”
Low EQ leads to:
- miscommunication
- resentment
- emotional volatility
- poor decision‑making
- micromanagement
- staff turnover
- family breakdown
And because “the fish always starts to stink from the head,” low EQ in the leader infects the entire system.
How to Resolve EQ‑Driven Conflict
EQ‑driven conflict cannot be solved with logic alone. You must address the emotional layer first.
The document explains:
“Part one needs to deal with… the emotional factors… then we are in a much better position to start dealing with the rational factors.”
Step 1: Deconstruct the emotional past
This involves:
- acknowledging feelings
- ventilating grievances
- validating experiences
- identifying triggers
- unpacking childhood dynamics
The document describes this vividly:
“Spread the entrails out over the table… hold them up to the light… identify the trigger points.”
Step 2: Reconstruct the future
Once emotional triggers are neutralised:
- rebuild trust
- clarify expectations
- design new behaviours
- create agreements
- plan for the future
This shifts the family from:
- negative → positive
- past → future
- resentment → cooperation
How to Build Emotional Intelligence (Prevention)
EQ can be developed — in individuals, families, and businesses.
1. Build Self‑Knowledge
Reflect honestly. Seek feedback. Compare internal perception with external reality.
“If that feedback comes as a surprise, we’ve got a problem.”
2. Build Self‑Management
Use calming techniques:
- hands flat on the table
- feet flat on the floor
- deep breathing
- draft responses and sleep on them
3. Build Empathy
Work harder to understand others’ perspectives. Respond in ways that meet their needs.
4. Build Social Skills
Communicate more. Network more. Compliment more. Engage more.
5. Build Motivation & Resilience
Find your inner voice. Adjust your path when needed. Focus on meaning, not fear.
The document ends with a reminder:
“Nobody says, I wish I’d spent more time in the office… some people say I wish I spent more time laughing and drinking champagne.”
EQ helps you build a life — and a family business — worth living.
Final Thoughts
Emotional intelligence is not optional in family business. It is essential. Low EQ creates conflict. High EQ creates harmony, resilience, and long‑term success.
