Bad Blood in the Boardroom

Antecedents and Outcomes of Conflict in Family Firms

Authored by: Andrew C. Loignon , Franz W. Kellermanns , Kimberly A. Eddleston , Roland E. Kidwell

The Routledge Companion to Family Business

Print publication date:  September  2016
Online publication date:  September  2016

Print ISBN: 9781138919112
eBook ISBN: 9781315688053
Adobe ISBN: 9781317419990

10.4324/9781315688053.ch17

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Abstract

Despite the potential benefits afforded to family firms based on close family relationships (Habbershon & Williams, 1999), strife within the dominant coalition of family members can limit the effectiveness of these organizations (Lansberg, 1983). An example of the deleterious effects of conflict within family firms recently unfolded at Market Basket, a chain of U.S.-based grocery stores. A long-simmering power struggle between two family factions erupted when the company’s CEO, Arthur T. Demoulas, was forced out by his cousin over making questionable investments and reducing dividends to shareholders (British Broadcasting Corporation, 2014). The conflict eventually spilled out of the boardroom and into the workforce when employees went on strike in support of their ousted boss (Pathe, 2014). Although a settlement was eventually reached (British Broadcasting Corporation, 2014), the strike cost the company more than $10 million each day and jeopardized its standing with its loyal customer base (Pathe, 2014).

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