Most family business founders dearly hope and desire that the ownership of the enterprise remains and flourishes through several generations. So it's not surprising to note that successful generational transition is a cause of concern. Unfortunately, in many family owned businesses, succession planning merely focuses on ownership structure, wills, trusts etc rather than on the growth of human and intellectual capital in the family.
How can family business develop next generation leaders who can successfully take over the reins of business by acquiring a distinct leadership of their own, rising over the shadow of their father or mother? There are a number of factors that influence the development of next generation leaders. It has been found that succession is smooth when the next gen leaders are well prepared for leadership positions.
An important factor that can positively influence the development of next generation leader is providing them a safe, secure and supportive environment that will increase their propensity to take ownership for their successes and failures. Open communication, shared values and norms and a congenial atmosphere can further enhance the leadership qualities of younger generation leaders. Family business owners would be wise to create a reasonable balance between time and energy focused on business and on family relationships.
Senior generation leaders would do well to assign appropriate roles and responsibilities, compatible with their age and experience, to the next generation leaders to facilitate early leadership experience. It is also imperative that younger generation leaders take responsibility for the development of their own leadership skills.
The good news is that leadership skills can be learned. So forward thinking family business leaders should focus much more on developing their human capital (next generation family leaders) and work just as hard to build positive family relationships as they do to create positive business results.