Sunday, August 9, 2020
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Cultivating Leadership in Your Family Business

When a business is founded, it is done so in response to a dream, an ambition, or a life calling for the entrepreneur. The business fulfills the entrepreneur’s need to take risks and be his or her own boss. When that business grows in the family, however, it may become evident even early on that there may not be a clear path to determining and then developing the next generation of leaders in the family.

Business founders must do a great bit of soul searching and not necessarily turn to birth order to determine who is next in line. The business owner must instead pay more attention to which person in the next generation possesses true business and leadership skills, as well as passion for the business and its mission, rather than to his or her gender and relative age compared to siblings.

It is also important that the next generation of leaders not be expected to possess the exact same mix of skills and characteristics as the entrepreneur, because a different skillset may be more valuable for a more mature business.

Teaching Responsibility, Self-discipline and Ethics:

You must be able to rely on your next generation of leaders to confidently make sound business decisions.

  • Formalize an employment plan for the next generation so that responsibilities are clearly defined; conduct formal performance reviews.
  • Expose them to situations that require difficult decisions and help them understand that there may not be one right answer.
  • Let family employees make their own decisions and their own mistakes. Address mistakes immediately and honestly.
  • Encourage risk taking within reasonable limits.
  • Teach fiscal responsibility.
  • Model the behavior you expect in terms of trust, honesty and accountability.
  • Discuss with your future leaders the value of considering the big picture and long term thinking versus short-term.

Teaching Interactive Skills

Tomorrow’s leaders must also be leaders of people, so guide them in learning appropriate people skills.

  • Discuss how to get the most from communication exchanges by listening to what people say and also how they say it; pay attention to body language, tone and facial expression.
  • Teach how to listen to your own feelings.
  • Give honest feedback regarding how your future leaders are perceived.
  • Develop unbiased human resources policies that take good care of your employees.
  • Create opportunities for bonding and socialization within your business.

Teaching Planning and Analytical Skills

Leading your business into the future requires visionary thinking, so be sure to mentor tomorrow’s leaders in the areas of planning, vision, and analysis.

  • Encourage the pursuit of goals and development of skills and talents.
  • Discuss goals for the business and for the family on a regular basis.
  • Teach problem solving and discuss hypothetical problems to brainstorm plans of action.
  • Focus on investigating trends that could affect your business and discuss ways to address those trends.
  • Pay attention to emotions in the midst of difficult decisions – not all decisions can be made based on cold, hard facts.

Contributing Source:

A business founder may be: of above-average intelligence; highly energetic; controlling; and willing to take risks.

Whereas a business leader may be: of average intelligence and energy; but good with listening, mentoring, networking and delegating; and great in dealing with crises.

Even when a clear leader stands out, it is of utmost importance for the entrepreneur to mentor the next generation of leaders for his or her business, recognizing too that the challenges that may face an older business are likely not to be the same that were faced in the business’s formative years. Mentoring your family business’s future leaders should be an ongoing process and one that encompasses a wide variety of skills and characteristics.

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