Generation To Generation
14th November 2016 Sian Steele, Family Business Leader, PwC UK
There are five things that the current generation of family business leaders can do to make sure that the next generation have the best chances to succeed in the family firm.
1 - Plan ahead
The single most important success factor for succession is a good plan. That starts with detailed career and development planning for the next gen, so that they can get a wide range of experience and acquire the right skills. If possible, find ways for them to work outside your home market, as well as outside the family firm. This will help them build their credibility if they do eventually decide to come back to the family business
2 - Make it an opportunity, not a burden
Many of the next gen are excited about the chance to work in the family firm and take it over one day. But make sure they don’t feel expectation as a burden, and have the chance to make a free choice about their own future.
3 - Give them the chance to build something of their own
Many of the respondents taking part in the recent PwC Global Family Business Survey talked about the possibility of setting up new entrepreneurial ventures to run alongside the main firm, and 47% of those questioned in a previous PwC next gen Great Expectations survey said that they would like to do this. Such ventures can be a wonderful way to give the next gen their own area of responsibility, where they can learn, explore new ideas, and gain vital skills. And who knows, those new ventures could evolve into the future for the family firm.
4 - Understand where and when to let go
Almost all next generation members say they would welcome continued support from their parents when they take over (91% in our next gen research), and many talk with feeling about the mentoring that they have received, and the lessons they’ve learned. But there’s a fine balance between being there to help, and never letting go.
It’s an understandable wrench to step back from a business you’ve run, and in many cases, built. Many next generation members acknowledge this as a challenge in their own family. So spend time discussing the exact shape of your future role, and find yourself something to do beyond the business, so you won’t constantly be tempted to ‘just show up.’
5 - Address family governance
One positive role that the current generation can play is in relation to family governance. We all know ho dangerous conflicts and misunderstandings can be in family firms and many next generation members are worried about the prospect of dealing with ‘family politics.’
The older generation are ideally placed to help manage this, both through their experience and the ‘gravitas of age.’ So if your family hasn’t yet got to grips with family governance, or could benefit from a proper family constitution or family council, why don’t you take on this task yourself, so the next generation can concentrate on taking on the business.
About the Author - Sian Steele is the Family Business Leader for PwC in the UK and works with family business clients in the UK and internationally. To find out more about the services offered to family businesses by PwC please visit their website here