The Current Generation’s Role in Succession in a Family Business
We discussed the importance of preparing the next generation to lead the family business and the key factors in making this happen. Today I would like to scroll through the tables and touch on the role that the current generation plays in enabling a successful family business plan.
If you read this, the definition of the current generation may be related to “How do I lead this process”. This is true. As a family business leader it is your responsibility to plan a successful transformation process that includes changes in ownership and leadership, addressing housing planning and property preservation, and maintaining family harmony along the way. While this is beyond power in itself, I would like to focus on what may be the most difficult part of the current generation sequence.
At first it didn’t count to me that Jerry Yang, the founder of Yahoo !, “has resigned” from his company’s Board of Directors. He’s only 43 years old, he has a great company, the only thing he knows, and heck – he’s a founder! Do you really have so much hankering to hit the golf course every day? Of course not; he was fired. Perhaps in soft words, he was shown light.
The first successive problem facing the current generation of family business, and perhaps the business as a whole, is the inability of the current leader to open up space for the next generation.
Part of the problem is that it is very wrong: the way to run a family business in a row is to stop earning. Jeff Krepps, PhD, a family planning specialist in Raleigh, puts it this way, “When a child leaves home, the parent has to change. Otherwise the relationship may break down. ” They need to step back a little.
Yes, it is incredibly difficult to do. You are an expert at what you do, anticipate problems and opportunities before they exist, and have deep bonds with customers, suppliers, and employees during the war years in the market. But now I ask you, what would happen to your family business if you went on vacation for a month without a phone call or email? Or if you were hit by a proverb truck?
There are some obstacles to “let go”. First, you are so good at it that the business cannot afford to pay for any of the wrong actions. But we know that in order for anyone to learn something, he has to make some mistakes and make mistakes. (My wife and I are trying to teach our children how to cook, so we accept that some pans will be spoiled.)
The second is that they will want to change the business in some way. You will not like these ideas because you have tried them before and you do not think they will work, or you do not have the confidence of the next generation to achieve them. Without hesitation, however, you may want to consider that you are probably more dangerous than you were before. Family businesses that have grown from one generation to the next have failed because they are sitting on the business they have been given. They made some changes. It is better for the next generation to try when you are ready and able to help.
But perhaps the biggest obstacle is that you have become like a business. People identify you as a company. Thus, relinquishing some control or corporate responsibility raises the question: who am I when I do not lead this company? This can be a scary thought.
Creating a place for the next generation to rise is not always easy or comfortable. If the company is doing well, why is it moving the boat. If a company does not do well, then you may have a lot to offer, perhaps standing in the way of progress. Maybe this is what someone said on Yahoo! helped Jerry Yang to see.