Generations Working in Partnership

Are you finding the next generation is losing interest in the family business? Perhaps intergenerational differences are causing disconnection or conflict…

It will not come as a great surprise that cultural differences between generations can create conflict due to clashes in values, work ethic and communication styles. Different generations have effectively grown up in different worlds with different challenges, opportunities and stages of development (technological and otherwise).

However, if a family business can acknowledge these differences and address them, they can tap into a powerful opportunity for knowledge sharing.

Here are five ways in which you can manage generational differences and support the next generation of entrepreneurs:

1.  Develop generational awareness and a multi-generational outlook

2.  Revisit your family vision and values

3.  Collaborate on the family governance structure

4.  Focus on education and leadership skills

5.  Proactively foster an entrepreneurial culture

Develop generational awareness and a multi-generational outlook

Developing generational awareness should involve educating family members about generational differences and encouraging them to actively seek out other generations’ perspectives. A simple first step could be to organise more family events, where individuals can get to know each other better and spend quality time together. Another effective way to foster good communication skills between generations is to bring in an experienced facilitator to run a communication workshop for the family, which will help individuals understand their own, and other family members’ preferred communication styles and ways of working. 

Without an understanding of one another, family members may struggle to work together successfully as was the case in the following example:

“A competent young family member had been promoted to a managerial position and was eager to introduce a new digital marketing plan he had devised. The founder and leader of the family business was resistant to the change. His traditional managerial style of tight control, coupled with his lack of confidence in his own technology expertise, led him to the decision not to implement the plan. Eventually, frustrated at the lack of trust, autonomy, and resources that were given to him, the young family manager left the family business “

It doesn’t have to come to the point where talent and opportunities are lost! In addition to specifically seeking to develop intergenerational awareness, there are many other avenues you can explore to ensure your family continues to work well together.

Revisit your family vision and values

The family’s shared values and vision for the business are at the heart of creating a strong sense of identity, and allow for the continuation of family bonds across generations. They should be revisited periodically to ensure they evolve with the changing times, the business and its leadership. Spending time revisiting your values and/or how you live them can be a fantastic way to build cohesion across generations and ensure that the company continues to operate in the way the family intends.  

Collaborate on the family governance structure

The same goes for the family governance structure: collaboration between generations in the updating of existing structures and processes ensures the family’s ownership succession plan remains in alignment with its shared vision and values and, crucially, creates shared ownership for its successful execution.

Creating or updating your governance structure is usually best done with the support of outside facilitation so each family member can participate fully.

Focus on education and leadership skills

It is important to educate the next generation about the family business, about what it means to be an owner and steward of your shared assets and what is expected of them in the roles they will occupy within the enterprise system. There are many excellent resources and networks available and some family businesses chose to create their own education programmes.

If your next generation are going to be in leading roles in the business, make sure they are fully equipped as leaders. It is no easy task to take over the family business leadership. All eyes will be on them so ensure they are prepared and ready for the task.

Proactively foster an entrepreneurial culture

We also encourage families to inculcate entrepreneurial drive early in their next generation, providing opportunities for engagement and specific forums for their voices to be heard. This allows the family to tap into the next generation’s skills, ideas and experience.

Many family businesses have remained highly successful across many generations specifically because they were able to instil an entrepreneurial spirit in younger generations. We have seen many examples of families whose younger generations evolved their businesses with the times and/or started new ventures that grew into major players.

A way to go about this is to make internships available to next generation family members which mean they in turn benefit from the older generation’s experience, knowledge and skills. Another is setting up an Entrepreneurship Fund which can be a great way to nurture and harness the entrepreneurial spirit of the next generation, and to benefit from their ideas and capabilities. In this way, spaces are created for supporting the next generation of family entrepreneurs in a way that is beneficial for everybody, and simultaneously strengthens the bond between generations.

Having a multi-generational outlook means younger generations respecting the part the older generations have played in building a solid family business foundation, and older generations creating space for the ideas of the next generation.

We believe in the benefits and necessity of this approach in an ever-changing world where hyper-adaptability has become crucial to long-term success and survival.