• Sunday, July 21, 2024
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How to Resolve the Reluctance to Join Family Business

family business

The desire of every business leader is to maintain the family business within the bloodline for many generations. This desire would be easy to achieve if business leaders could live forever. But one day the life of a business leader will end. Business leaders must, therefore, find a member of their own blood who is willing and able to take over from them. Sometimes this member exists.

Other times they are reluctant to follow in their fathers’ footsteps. When a family has a willing and ready successor, it means a business leader has inspired one of his own to take after him. When a family does not have a successor, it means business leaders have to look for other ways to preserve the family business. The absence of a successor means bloodline succession has failed. When Bloodline succession fails it is usually for two reasons. The first reason is that there is no willing and competent successor to take over the business. The second reason is that there are willing successors. But the successors that exist are not competent to lead the business. Willing but incompetent successors should not be allowed to lead the business. When successors are not willing but competent, it means they are not interested.

A lack of interest can come in two ways. First, a successor can have a revocable disinterest and second he can also have an irrevocable disinterest. When a successor has a revocable disinterest, it means that the lack of interest is caused by certain factors that can be resolved. These factors are usually linked to certain misunderstandings or misalignment of agendas. For example, successors may lose interest in a business for the following reasons. The fear of losing one’s autonomy, the possibility of losing oneself in the shadow of their father, the lack of a clear career path for growth and development and the rejection of certain ideas, interests, and agendas due to a difference in perspectives. These kinds of factors can be resolved when the right help is sought. A revocable disinterest is therefore not a real disinterest. It is the presence of certain concerns or fear that discourages the successor from taking on the business. When a successor has an irrevocable disinterest, it means he has certain reasons for not joining the business that are irreversible. These reasons usually emanate from deep foundation issues that are neglected over time. For example a total lack of passion for an area of business can lead to irrevocable disinterest. A silent or expressed hatred or resentment for a business leader, a long-held misunderstanding that has resulted in blame and hurt and seeing joining the business as sacrificing one’s happiness.

These types of disinterest can be difficult to resolve. Successors with irrevocable disinterest are better left out of the business. When a family only has these types of successors, business leaders must find other means of preserving the family business. But how do successors develop disinterest in the first place and where does it all begin?

Successor’sdisinterests are mostly caused by business leaders. Business leaders cause disinterest in successors in three related ways.

First, they misunderstand what succession really means. They interpret it as a privilege or favour.  While this is partly true, it is not the entire truth. Handing over one’s business to the next generation is not a privilege or favour. It is a fair exchange and here is why. The only reason business leaders pass on their businesses is because there is a time limit on their lives. While they have wealth as an advantage they lack a time advantage. The successor, on the other hand, has a time advantage but lacks a wealth advantage. When succession takes place business leader and their successor make up for their disadvantage. A Business leader gets the time advantage he needs and a successor gets the wealth advantage he needs.  This makes it a fair exchange and not a favour.

 

Second, business leaders see succession as a reverse relay. A relay is a race in which athletes run a pre-set distance carrying a baton and running towards the next athletes in front of them. A relay race is all about moving the baton towards the finish line. This, therefore, means that getting the baton to the next person in front is more important to winning the relay than remaining in one’s position. There has never been a reverse relay where the person close to the finish line runs backwards to the person at the start line. The movement of the baton is always a forward movement. Succession should be treated exactly the same way. It should be about preparing the business and successor for the future not maintaining them in the present. Business leaders must shift position and run towards the successors. This means that they must move from the rules that govern their generation to the rules that will govern the successor’s generation. They must align with the successor and redesign their businesses for the future. Aligning with the successors is proof that a business will align with future customers. The more successors are stuck within the founder’s generation doing things that pleases the business leader. The more they will struggle. Everyone is designed to function best within their own generation and successors must be allowed to focus on moving the business into their own generation. If successors must thrive in the future they must be given permission to redesign and restructure the family business to suit where they are going. When successors concerns are not addressed, chances are high that future customers will have the same concerns.  Rather than reject the changes and challenges successors bring into a business. Business leaders must be open to discussing and reviewing successors concerns.

 

Third, business leaders display an attitude of entitlement. While it is hardto not be entitled to a business you have invested so much in,business leaders must find ways to manage this entitlement. They must shift base from an entitled position to a position where they see their businesses as a gift to the next generation. Treating the transfer of one’s business as a gift makes it easy for succession to take place. Take for example when a man wants to give the woman of his dreamsa gift. Hefocuses on one thing only. He focuses on how his gift will be accepted and by extension how he will woo the woman. To achieve his goal, he must find out what the woman wants. That is what she desires and will appreciate. Then he must find the perfect gift that will deliver this value. When he finds the gift, he must then package it and device means to present the gift in ways that makes it irresistible. When he goes through this process, chances are high his gift will be accepted and his kind gesture returned.He will be successful with hisgift because hefocuses on the needs of the woman first in order to meet his own needs. This is how to present a gift that cannot be rejected. Business leaders must pass on their businesses with a gift mentality. They must seek to understand the needs and desires of the future generation. They must also prepare their businessesto meet these needs. When a business is designed for successors they know it and will accept it.  No one accepts a gift that is perceived as not valuableto them. The goal of a business leader is to package their businesses in ways that are motivating for future generations.

For Business leaders to hand over their business to the next generation, they must overcome any reluctance to join the family business. Overcoming reluctance means business leaders must resolve pending issues that are holding successors back. Without the resolution of these issues successors will notjoin the business. And when force is used it will kill the business faster.To resolve succession conflicts Business leaders must seek the right kind of help.

Perhaps you still struggle with aligning your succession goals with that of the next generation. We can help you. Through our Succession Resolution Program, we will help you reach a mutual alignment with your successors and show you how to prepare your business for the future. Being a successor generation ourselves and having worked with successfulbusiness owners. We know how to align both parties and help them make productive progress that will save the greatest wealth of the family from dissipation. For more information about how we can help you send an email to [email protected]

This article is an excerpt of my upcoming book “THE ORDER OF BLOODLINE BUSINESS SUCCESSION’ -How To Hand Over Your Years of Hard work to the Competent Hands of Your Own Blood. For more details send an email to [email protected]