next generation

Preserving Your Vision – Preparing the Next Generation

In a previous post, I discussed the importance of having a succession plan and I’ve also addressed what to do if a family member isn’t interested in continuing with the family business.  Every business and family is different; different products, different services, different customers, different family member personalities.  It’s all different.  However, there are factors that are universally the same when it comes to preparing each generation for their participation and investment in the company.

According to Stephen P. Miller, co-founder of the Family Enterprise Center at UNC Kenan-Flagler, “A positive family climate is more likely to create a safe and supportive environment for next-generation family members to take responsibility for the successes and inevitable failures that come with practicing leadership behavior.”

To create this environment, Miller adds, a family must focus on open communication, values and norms that are accepted by all members of the family, and a senior generation that is focused on developing the next generation, attending to their welfare, needs, and concerns, as opposed to dictating rules and wielding unquestionable authority.

The Importance of Transparency

In our own family business, we are constantly looking to be more transparent and open with each other and with our team members and shareholders, utilizing advances in technology for greater ease and accessibility, and we strongly support equality, both when it comes to trust and having a say in the process. As board members, my siblings and I watch out for each other, first as family members and then as family business members, but always with transparency and openness in our actions.

Additionally, it is my humble opinion that recognition is usually over-desired and under-delivered, especially in a family business. If a balance can be reached, it can be a key factor in the next generation’s decision on whether or not to join the family business.

Create Clear Expectations

Good communication combined with effective and open governance systems are invaluable in creating a fluid company structure for the next generation, giving them a clear idea of the inner workings of the business. Involvement in family meetings that focus on open communication will also give them a sense of the direction of the business and provide them with the opportunity to contribute and incite change.

“Senior generation leaders … would be wise to provide next-generation family members with age- and experience-appropriate levels of responsibility and decision-making authority to help them gain early leadership experience, including the risk of failure that can teach valuable leadership lessons,” states Miller.

While you shouldn’t try to drive your children toward joining the family business, you can greatly increase their potential contribution to the company by providing opportunities and developing these valuable skills early. Even if they don’t use them for your business, they’ll be able to apply those skills toward finding a job that is personally fulfilling. At the end of the day, your efforts in helping them understand the importance of the family business should be rooted in a love for what the family has built and, more importantly, for the individual.