Tag Archives: leader

Next-Generation Leadership in the Family Enterprise Part 2

Steve Miller
Steve Miller

In a two-part blog post, Family Business Group consultant Stephen P. Miller highlights some key findings from his recently completed research on how nextgeneration family leaders develop leadership skills.

My research on nextgeneration family business leaders demonstrates the importance of family climate on the degree to which nextgeneration family members learn leadership skills.  Ironically, some of the leadership characteristics we often observe in entrepreneurs who build successful family firms may actually work against them in their efforts to prepare the next generation for leadership responsibilities.  The kind of hardcharging authoritative leadership style that may have helped a senior family entrepreneur overcome the significant challenges of establishing a successful family firm negatively affects the development of nextgeneration leaders.  Nextgen family leaders need age and experience appropriate opportunities to practice decision making, take risks, enjoy successes, and recover from failures.  A senior generation leader who makes all the decisions and sets all the rules can unintentionally deny nextgeneration family members the experiences they need to develop their own leadership skills.

The study further suggests that nextgeneration family members interested in playing a leadership role in the family business should consider taking responsibility for their own development of leadership skills, particularly emotional and social intelligence competencies.  If the family climate is one characterized by senior generation leaders who exercise unquestioned authority, nextgen leaders would be well served to suggest or create some area of the business for which they could be responsible and held accountable by others.  If the senior generation refuses to allow it, then the potential nextgeneration leader may be wise to seek experience with genuine responsibility and accountability outside of the family firm.  The research is abundantly clear that shouldering real responsibility is strongly related to emotional and social intelligence competencies demonstrated by the most effective leaders.

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The Ideal Family Business Leader part 2

Joe Schmieder
Joe Schmieder

As strong family business leaders juggle their many demands while balancing the needs of the business and the family, they also demonstrate these additional characteristics.

1.     Mentor & Role Model:  Nurtures, cultivates and develops family member talent as well as non–family talent.

2.     Innovative:  Leads and supports diversification efforts and drives towards preparing to reinvent portions of the business.

3.     Tough Minded:  Is willing to discipline and even fire family members when necessary.

4.     Listener:  Willing to listen to independent outside board members and advisors both in the business and outside of the business.

5.     Succession Preparation:  Plans ahead both for leadership succession and ownership succession of the business.  Is willing to let go when the time is right.

While this list covers a lot of ground – there are many other attributes that make a successful leader.  What would you say is missing from this list – what else do you think makes for a strong and effective family business leader?

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The Ideal Family Business Leader part 1

Joe Schmieder
Joe Schmieder

What is the make-up of an effective family business leader?  From my own observations and interactions with family business leaders for over 30 years, as well as listening to my FBCG colleagues who have worked with 2000 family businesses, I have recognized some traits that stand out in those leaders who demonstrate an uncanny ability to develop both the family enterprise and the family.

As you develop your own leadership skills, you may find it helpful to review these ten common characteristics of successful family business leaders.

1.     Visionary:  Looks towards long-term performance versus the short-term returns.

2.     The Balancing Act:  Understands how to constantly balance the attention needed for working in the business sphere and in the family sphere. 

3.     Birth right vs. Earned right:  Articulates and demonstrates the importance of family members needing to earn their right into the family business versus making the entry a presumed birth right.

4.     Family Voice:  Supports the voice of family shareholders and other family members who are not working in the business, either through direct contact or through an entity such as a family council.

5.     Non-Family Employees:  Ensures that executives and employees, who are not members of the “descendent” family, actually feel as though they are part of the family and are appreciated as key parts of the family business. 

Check the next blog for the final five characteristics & meanwhile, join the conversation….

What would you add as a key skill from your own experience?  If you are a family business leader – what would you want to see your successor really manage to do well?

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The road to ruin is paved with good intention – What it takes to be the company’s next leader – Part 3 of 3

Drew Mendoza

 

In our line of work, it is common for one family member to describe another family member in less than glowing fashion.  We hear a lot, no make that A LOT, of descriptions by one member of another that suggest or proclaim themes, hidden agendas or perceived personality flaws.  

And in every case, the descriptions are true and valid from the speaker’s point of view and based on their own personal perception. 

In family business the stakes not only include family relationships but they also  include money.  Significant amounts of it relative to the overall net worth of every member of the family.  And we humans predictably and understandably become worried, anxious and / or frightened at the possibility of our own financial ruin, and that it could be caused by another member of the family.  In the saddest and worst case scenarios actions like, time with grandchildren being withheld as punishment against grandparents, siblings no longer speaking to each other, and estrangements and cutoffs occur.  We have all read tragic sagas in the newspapers of family members going to court, or worse family implosions that cause the demise not only of the business, but the family. 

And yet, in most cases, these same family members who seemingly judge, criticize, battle with, or do not trust one another – when assessed by independent, objective and trained professionals – are determined to be, not only normal, but, in their heart of hearts, well intentioned.  Sure, they can sometimes appear to be mean spirited, arrogant, or self-serving.  But, beneath that facade, usually lies someone who is well intentioned, and loves their family, despite the not-so-great ways they manifest their own fears and worries. 

Current leaders, next generation leaders and family leaders may sometimes not appear to their cousins or siblings as being well intentioned. And, it is just as common that these leaders view those same cousins and siblings as being less-than-well intentioned too. 

The empirical research is clear:  the genesis of family enterprise failures most often are caused by strife among two or more people who, really, in their heart of hearts, have the very best of intentions. 

So what is the answer? It seems like it might be complicated, but the simple solution is to always keep the lines of communication open, take the time to understand what another might perceive. If you shut down the communication there is no hope, but choosing the often difficult path of trying and trying once again, it is at least possible that families could eventually understand and uncover the good intentions of their family.

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