Bold Entrepreneurship or Stable Leadership? Questions for the Next Generation Leader

Image via

Founders of family businesses are usually known for their entrepreneurial drive and spirit. This leads to the members of the following generation experiencing considerable pressure when it comes to the moment of succession as not only are they expected to fill the founders, often rather large, shoes, but they are also supposed to show equal amounts of entrepreneurial zest. This pressure stems from the mistaken assumption, that entrepreneurship is equal to leadership. However, contrarily to common belief, it is not necessary for second-generation family members to be entrepreneurs.

The Balance Between Stability and Vision

Especially when it comes to the transition from the first to the second family generation, there is a great need for family members to show leadership and vision. Whether this manifests itself in entrepreneurial innovation or whether it is expressed through honed managerial skills is not the material point. One of the main factors that will make or break the second generation in its attempt to take over the from the founder, is to what extent changes to and consolidation of existing structures can be undertaken in a unified spirit. In an ideal case, each family member of the second generation will find a position in the company that allows him or her to perform at their best and to contribute successfully to the family firm.

Another argument that links into the fact that entrepreneurship though beneficial is not necessary in each family member, is the fact that the business simply requires different input at different stages of its growth cycle. While the founding stage of the business may primarily need entrepreneurial drive, a next stage might be more successful when dedicated to structuring and efficiency. If such is the case then the second generation members’ primary function should be focused on the direction and administration of the business rather than pursuance of further personal ambition.

There is no denying that entrepreneurial spirit can be a desirable trait in a family business member. However, we must always bear in mind that the entrepreneur, who materialises an idea into a successful organisation is unique and imitation is therefore impossible at the outset. Following in footsteps of a successful family entrepreneur can therefore only be accomplished in a satisfactory way, if the next family generation is aware of its strengths and weaknesses and, rather than attempting to be exactly like the founder, finds its own ways to contribute to the family business. Whether this includes much entrepreneurship or not will in no way be an indicator of success.