One of the topics that comes up over and over again in the family business arena is that of the next generation and their preparedness to take over the reins.
Who has not heard at least one tale of a leader who is reluctant to let go, while claiming that the supposed successor is not yet seasoned enough to do the job. Many people will rightly point out that part of the leader’s job should have been to ensure that a successor would be ready, but they would be missing a big part of the picture.
The next generation (NextGen) also has an important duty here, and it sometimes gets forgotten. While the current leading generation should be helping prepare their successors, the following generation MUST not only follow along, but they actually need to take the lead.
I wrote a blog a couple of months ago (http://www.fbo7624.com/blog/pre-mediated-planning-makes-sense-me) about some of the great work of Dean Fowler. In that post, I concentrated on the phrase that he used, “Pre-Mediated Planning”, because it really resonnated with me, since it was a new term, but I also found it catchy, memorable, and frankly “blog-worthy”.
A few weeks ago I was invited to lead a workshop on the Family Circle at an upcoming Families in Business event at the University of Vermont (http://events.r20.constantcontact.com/register/event?oeidk=a07e933f02d3632cace&llr=rejdpeeab). While discussing the title and subject of my breakout session with Dann van der Vliet, the organiser, he mentioned that blog post as a possible idea.
I agreed, and decided that I should contact Dean Fowler to clear it with him, lest I be somehow misappropriating his work. When Dr. Fowler replied, he indicated that he was fine with my discussing the pre-mediated planning aspect part, but his main concern was that I was missing his main point. Ergo this blog post, to make sure that I give that point its due.
Fowler stresses that the families he has worked with that have had the most successful transitions, are the ones where the NextGen successors actively took on leadership roles. But we are not just talking about a leadership role in the company, but a leading role in the transition.
Another way to say this is that the successors did not sit back and wait to be given the company, they actually proved that they were ready and left no doubt that they were ready to take over the company.
Is this another one of those ideas that is easier said than done? I believe it is, but then again, most things that are worth doing are not easy. It is simple to explain, but not necessarily easy to accomplish. So how can we put the odds in our favour?
As is so often the case, the word “communication” comes immediately to mind, but unfortunately, imploring families to communicate better is rarely sufficient. They usually need more specific advice on who needs to communicate what, to whom, and how often. So here we go.
The two generations need to make it clear to each other that all the people involved have a realistic understanding of what needs to happen over the coming number of years. In fact, a great place to begin would be to define a timeline, so that both groups can work with a similar schedule.
The leading generation must be realistic and understand that they will not be around forever, and that it is in the entire family’s interest to make the business transition successful.
The NextGen need to take the proverbial bull by the horns, though, even if their elders are reluctant to see it the same way. They need to proactively go about the business of preparing themselves to take over, regardless of any attitudes of immortality that there parents generation might exhibit.
Yes, easier said than done, but the sooner it starts, the better for all.