‘Family culture is like a pickle jar:’ What happens when a family business expert analyzes the #Megxit royal family drama

January 16, 2020, 7:30 PM UTC
Britain's Prince Harry, Duke of Sussex and Meghan, Duchess of Sussex reacts as they leave after her visit to Canada House in thanks for the warm Canadian hospitality and support they received during their recent stay in Canada, in London on January 7, 2020. (Photo by DANIEL LEAL-OLIVAS / POOL / AFP) (Photo by DANIEL LEAL-OLIVAS/POOL/AFP via Getty Images)

Sibling rivalries, new spouses, “transition periods,” and disgruntled heirs. Yes, the current House of Windsor drama involving Meghan Markle and Prince Harry stepping back from the royal family (and the queen begrudgingly granting their request) has all the makings of a soap opera. But the plot points also align with the challenges of another oft-fraught realm: that of a family business.

So who better to make sense of the #Megxit tabloid fodder than a family business expert. Nigel Nicholson, a professor of organizational behavior at London Business School and author of Family Wars: The Real Stories Behind the Most Famous Family Business Feuds, was up to the task, so Fortune asked him to analyze the scandal surrounding Buckingham Palace through his family-business lens. One piece of advice? Think of the royals like a pickle jar. Of course.

This conversation has been edited for clarity.

Let’s say we have a prominent, well-known family business. Their challenge isn’t determining a successor—that seems pretty obvious—but in finding a job for a child who doesn’t have a predetermined role. How should they map that out?  

Remember, the family does not exist solely for the business, nor the business solely for the family. It’s not the family’s job to “map out a role” for its members, but to facilitate their choices, and ability to choose. 

Governance has to be adaptive to the changing climate of the family and needs of the business. Time for them to use their wealth to support roles that might be desired, and [provide] clarity on exclusions (e.g. joining a rival royal family!).

Trooping the Colour
The royal family, seen here at a Trooping the Colour ceremony, is under fire amid Prince Harry and Meghan Markle’s decision to step back from their prominent posts.
Victoria Jones—PA Images/Getty Images

What’s the best way to integrate a new spouse into the family, particularly one that may not be deeply familiar with the family business ahead of time, or one who has their own business interests? 

Embrace them as a source of new ideas and insights—remember, family culture is a bit like a pickle jar—members get pickled! This means outsiders often have the sharpest perceptions of what [the family] might need in terms of reform, so listen to them. You don’t have to follow their advice, but you will benefit from listening. Help them find a role that works for them. If a trial run doesn’t work, don’t get mad with them; learn and support them in some other choice or path.

If a family member wishes to leave the family business—but has little professional experience or source of income outside that role—what’s the best approach for the family to take in navigating the potential reputational impact and in providing the financial support the defector may need in the interim? 

The [family business] can be part VC fund and part educational charity—put resources into helping the person train or acquire the capacity to follow their dream, so long as [the dream] meets the requirements of clarity, feasibility and acceptability (e.g. non-compete).

Say the family matriarch is supportive of the decision of a family member and his spouse to make a new life outside the family business, but she’s looking for a “transition period” with a potential middle ground. What options does a family have?  

The transition period has to have a goal; forget “middle ground”—there is only acceptable and unacceptable ground. Transitions need to be have stages: Preparation (communications, resource allocation, initial specification of options), Encounter (trying out various options), Adjustment (learning and developing the best lines of advance), and Stabilization (firming up on institutional aspects). Don’t rush it and don’t do it in public!

The Duke And Duchess Of Sussex Visit Johannesburg - Day Two
Meghan Markle and Prince Harry visited South Africa in October 2019. For months, rumors of family tension has followed the couple.
Pool/Samir Hussein/WireImage/Getty Images

At what point should a family business seek outside counsel for a problem regarding family roles in the business?

Outside advisors can be really helpful, but don’t ask them to solve your problem for you, but to help you solve it for yourself. It’s not their job to define the role, but to facilitate your deliberations—to help you be creative in your search for redefinition. Think outside the box—it’s your family, after all! Don’t copy other models—raid them for ideas, but every family is unique and you’re entitled to do what’s uniquely right for you.

For a family business that is deeply entwined with their home market, what are the opportunities and challenges of a branch being extended to a market abroad, even one in which the business has historical ties? 

It is a big step to venture abroad for the first time into a new market, and it is a big step as well not to expose the business to reputational risk by trying to extend the domestic model and failing. Far better to do something bold, original and different that is ring-fenced and separate.

How can a family business navigate the disruption caused by automation, social media, climate change (and so on); in this regard, is being a family business a benefit or a negative?

Family businesses can thrive in the digital age by virtue of their longevity, commitment to the long term, ability to take radical decisions fast, and value-driven commitment. But they need to be savvy and have some reverse mentoring, so they can feel at home in the digital age through the advice and experience of the younger members. The senior [family member]’s job is to make sure the culture is in good shape, with the family values honored and respected—it is to these that people should defer, not age or seniority.

You haven’t asked what about the problem of the patriarch or matriarch who is reluctant to let go. They need to find a new role that honors their experience and achievements, draws on their wisdom, but takes them out of the firing line with good grace.

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