A family business will only endure and be successful if there exists a commitment from family members to lean into that business and give it their all.
Whether they directly work within that business or are just part of the wider family, the business and its present leaders need their active support. Building and sustaining that support requires excellent communication and a family culture that defines the role of the business within the fabric of the family.
How would you score, out of 10, the family’s commitment to the business?
Part 6 — Foundations For Succession
Families, especially in the early generations of a business, are not particularly skilled in developing the commitment that a family business requires from its members. Businesses fail by their 3rd generation because of that failure to seed, establish and build commitment.
Often little thought is given to the need to develop family commitment and the business is just something that the parents do to earn a living. The business may then pass onto some or all of the children who possibly see it as an ‘obligation of sorts’ to continue or an opportunity to become wealthier.
Motive in taking on the responsibility for the family business is critical to its success and its continuity, especially across generations. A strong family business can form the glue that binds families across generations giving purpose and connection within a family, in addition to being a source of income and wealth.
But for that to occur, family members must understand the role of the business within the family and their responsibility to the business, its leaders and other family members. For family members, it must be about giving and not taking. Supporting the business and its leaders and having gratitude for the returns it provides rather than a sense of entitlement or privilege.
And for the business leaders, it is the responsibility that they have been entrusted with to carry the business forward for the benefit of the family of today and tomorrow.
From the moment a business is seeded within a family, its role must be crafted and upheld across that family with everyone’s role and responsibility clearly understood and enforced.
It is through this approach that great family businesses that endure over many generations are built, and those families receive the rewards for their focus, forethought and discipline in seeding succession in every family conversation. Commitment is built from day one and every day thereafter.