Ascending to the CEO role of a family enterprise is not usually a walk in the park. However, leadership has its benefits and, I have yet to meet a successful second or later generation leader of any family enterprise who, after totaling up all the battle wounds and joys of the job, didn’t look back on it as having been a worthwhile career decision. Of course the key word here is successful.
These successful leaders tend to have had a common experience: their rise to the CEO role was well thought out, well executed and a planned event. In addition, these successful successors tend to be passionate about wanting to lead, and conduct themselves in honorable ways that built trust among the other family shareholders and company stakeholders.
And these future leaders benefited from the presence of an appropriate governance body that played a critical role overseeing full transition of executive responsibility from one generation’s CEO to the next.
The ‘alternate reality’ we see in cases where there is no appropriate governance body is that the transfer of responsibility and authority seems to often stall, stumble or worse. Stresses from these mishaps ooze out into the family and, well, things can become pretty messy.
What have you seen? How often does the big-dog gracefully relinquish the CEO role without placing oversight of the process in the hands of an appropriate board of directors?