successively A popular HBO series that follows the power struggles and attempts to control Waystar Royco, a fictional dysfunctional family-owned conglomerate. The series, which concludes on May 28, continues to reflect on the challenges and issues facing many true family-owned businesses.
One It’s the heir Many parallels to real companies meant that Waystar Royco failed to have a succession plan. As I noted when the series’ third season ended in 2021, „the inability to keep and execute a plan can create a crisis situation that simmers for years and then explodes without warning in a full-scale disaster, scandal or other corporate emergency.”
There are other important similarities to point out before the series ends – and owners of family-owned companies should keep in mind. Efforts to keep leadership and ownership of a company within the family and inability to discuss the topic first with family members are the focus.
It’s so important that 85% of family-owned businesses surveyed recently said it was very or very important for their business to stay in the family for at least another generation.
According to the results of the opening ceremony Private Commercial Owner Survey Brown Brothers Harriman’s family owned 400 businesses Center for Family Business.
- 43% said choosing a successor was a challenge, knowing it would cause conflict within the family.
- 84% of respondents said that a business decision or discussion had led to serious disagreements or resentment in their family.
- 75% of these business owners say the roles of family members are not well defined or fully communicated.
Business owners of private companies said there were important reasons why they might be reluctant to discuss business with close relatives.
- 41% said family members make decisions based on personal benefit rather than what is best for the business.
- 36% indicated that these discussions would be heated or emotional.
- 35% said they had had bad experiences before having these discussions with family.
Art follows life
Just like this successivelyAncestor of Logan Roy Often expressing doubts about their children’s ability to manage the company, the survey found that many owners of private businesses lack confidence in the next generation of leadership.
- 75% of respondents cited leadership concerns and may consider selling some or all of the business.
Lack of strong leaders
- 36% said they don’t have strong leaders to take over their organization.
- 26% said their children are not interested in running a business.
The next generation is ready
„For a family business leader to become a real-life Logan Roy requires a forerunner in mindset,” Ben Persofsky, executive director of the Brown Brothers Harriman Center for Family Businesses, said in a statement.
„For decades, entrepreneurs have often found joy in making the big tough decisions in business („calling the plays”). However, succession is a challenging task. Adults must continue to work to guide the next generation to navigate the same tough decisions.”
„In the process, adults see the next generation as situations in which to wrestle issues and as a primary source of happiness,” he observed.
Liz Kislick writes Harvard Business ReviewHe recommends the following steps to help prepare the next generation for leadership in a family-owned company—which, of course, they’ll want to take on at some point.
- Moving family members through the company gives them the opportunity to learn all aspects of the business.
- Gear explains the importance and value of building a business, its finances, and its mode of operation Age and intelligence of each generation.
- Know your long-term goals for the business so you can plan for career growth that is appropriate for the next generation.
- Leaders of family businesses should assess their children’s abilities, talents and aspirations at all levels and provide them with as many opportunities as possible to learn about today’s business and how to ensure its successful future.
About the survey
Brown Brothers Harrimans Private Business Owner Survey 400 US private business owners were surveyed, excluding company-owned businesses or businesses owned by a fund. The research was conducted by Wakefield Research between March 14 and March 26, 2023, using an email invitation and an online survey.
For the interviews conducted in this particular study, there is a 95 out of 100 chance that a survey result would not vary, plus or minus, more than 4.9%, if interviews were conducted with all individuals represented. model.
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