One of the challenges facing family businesses on succession, is ensuring that the next generation have the appropriate skills and experience to take the business forward successfully.
A criticism which is often levelled at family businesses is that they can be quite insular.
One way to counter these challenges is to ensure that some, or all, of the next generation gain some external experience before joining the family business. This enables them to add real value to the business by bringing a different perspective, fresh ideas and new skills gained from that external experience.
In fact some families make it mandatory for family members to gain a minimum number of years’ employment experience elsewhere prior to being eligible for employment within the family business.
That additional experience and maturity on joining the family business can also help with gaining the respect of others working in the business.
Family members can sometimes find themselves running the family business simply through a sense of duty, rather than making a conscious choice to do so. This can lead to resentment and regret. Pursuing a career outside of the family business first and then taking the decision to join later can really help to avoid this situation.
Of course, there are many examples of where next generation family members have entered the business directly from education, started at the bottom and worked their way up to the top with a successful outcome. The chances of success are greatly improved by ensuring a plan of appropriate training, experience and mentoring along the way.
It is difficult to strike the right balance with the appointment, training and promotion of next generation family members. The next generation can have it too easy but equally can be treated too harshly to the extent they are never allowed to reach their full potential.
Each case needs a different approach – there is no ‘one size fits all’ solution. Invariably though honest, open communication among the family is important so everyone understands each other’s objectives, hopes and fears.
The Lovewell Blake Family Business Club holds informal events throughout the year. For more information call Steven Scarlett
on 01603 663300.