In closely held and family-run businesses, the interplay of Power, Authority, Control, and Influence (PACI) is often the hidden driver—or derailer—of success during major transitions. Whether you’re scaling, restructuring, or preparing for succession, how PACI manifests within your leadership and ownership structure is a leading indicator of your business’s ability to navigate change.
While PACI dynamics are observable, they’re rarely discussed—and often misunderstood. The signs are subtle at first but unmistakable when you know where to look. Watch for these red flags:
Artificial harmony masking a lack of trust and transparency
Slow or chaotic decision-making, despite good intentions
Confusing roles with blurred lines of authority
No clear budget or strategic plan to guide efforts
Excuses in place of results and accountability gaps
Recurring conflict that produces more heat than light
Strained relationships—even among high performers
No formal succession plan for senior leaders or owners
Stalled or declining revenue despite increased effort
*Triangulation, family members, employees, or leaders avoid direct communication by involving a third party to mediate, manipulate, or exert influence indirectly.
*Triangulation is especially toxic in family businesses. It fuels confusion, preserves unhealthy alliances, and erodes trust. It’s a sign that the system lacks psychological safety and clear channels of authority.
Why PACI Alignment Matters
When PACI is thoughtfully distributed throughout the organization:
Shareholders have visibility and appropriate controls over their investment.
Employees are empowered to make decisions and drive profit.
Trust builds, silos dissolve, and execution accelerates.
But when PACI is off—misused, hoarded, or ambiguous—the organization enters liminal space unprepared. This “in-between” stage—where you’ve left the old way but haven’t yet landed in the new—demands letting go of familiar patterns and adopting new ones. Without PACI clarity, this transition becomes stuck. Or worse—fails.
The Trap: Solving Symptoms Instead of Root Causes
Most organizations treat PACI symptoms like surface problems:
No role clarity? Write new job descriptions.
Low trust? Launch a communication workshop.
Declining growth? Push harder and work longer.
Triangulation? Often misdiagnosed as a “personality conflict.”
These are quick fixes—bandages on deeper wounds. And they keep people spinning, arguing, and burning out without solving the real problem. It’s the rat-on-a-wheel experience: exhausting effort, zero progress.
The Real Work
True PACI transformation demands owners and leaders confront—and release—the deeply rooted habits that once fulfilled psychological needs (like control, identity, and safety). This work introduces discomfort, even fear. And that’s exactly why most transitions stumble. The greatest threat isn’t external—it’s to your internal sense of psychological safety.
Conquering PACI challenges
To succeed, you must frame the right challenge and build the solution from the inside out:
1. Seek the Fundamentals: What’s the current PACI reality among shareholders, executives, and key influencers? How is it supporting—or sabotaging—your transition?
2. Explore Goals: What’s the vision for the future? What do shareholders, owners, and managers expect of themselves—and each other—through the transition?
3. Design the Path: Align structure, roles, and governance with your strategic goals. Define new, explicit channels for Power, Authority, Control, and Influence that support execution.
4. Implement with Intention: Incorporate PACI dynamics into your transition plan. Ensure shared visibility, common language, and aligned actions at every level.
5. Iterate and Adapt: No plan survives first contact. Build in checkpoints for evaluation and adjustment. A culture of adaptive learning beats rigid plans every time.
A Word to the Strategists
If you’re a tactical, execution-minded leader or advisor, this may all sound abstract or too “soft.” But beware: shortcutting the fundamentals leads to death by a thousand cuts—with mounting costs, growing confusion, and eroding morale.
A true PACI-centered approach may take longer to set up, but the return is exponential. You’ll move faster, with greater alignment, less resistance, and more profit—because you’re building on bedrock, not quicksand.
PACI, Defined
Control: The ability to direct your own life—and sometimes others. In business, it includes resource access, approvals, and decision-making rights.
Authority: The formal right to lead or decide, usually tied to roles or subject matter expertise. It’s only effective when it’s respected and accepted.
Influence: The power to shape thinking and behavior without formal authority. Comes from relationships, reputation, and insight.
Power: The total capacity to achieve desired outcomes using authority, control, or influence. It can be granted—or earned.
Going slow to go fast isn’t just a mantra—it’s a tested strategy. When PACI is aligned, the organization doesn’t just survive change. It leads it.