One of the greatest threats to family business success is nurturing in developing the right skills, behaviors and mindsets of the up-and-coming generation of family members.
Having grown up in a well-established and successful family business I know firsthand what it feels like to be born into situation like that.
Here is a list of the five most common bad behaviors I see with family businesses and what the family should do to curtail these bad behaviors.
1. Acting like a big shot when you really haven’t accomplished anything personally
Too many up and comers have grown up basking in the family business success and reputation and mistakenly give themselves way too much credit and credibility for simply being born into the family name.
It’s important for the family to stress humility as a virtue and stress the importance of learning to be hard-working and diligent as a person rather than simply thinking you can show up and ride on the families established reputation.
2. Being unrealistic about what it takes to sustain success in the family business
Success for the past 50 years doesn’t guarantee future success. The family needs to impart that mindset on it’s up-and-coming generation. In fact, overconfidence or over reliability on past wins are a sure recipe for future disaster.
The family leaders need to continue to instill the values of hard work, determination, and creativity as cornerstones of future success.
3. Feeling entitled not having had to work for anything
Many successful family business families enjoy wealth and a lifestyle that comes from their founders hard work. Smart families require future generations to have part-time jobs and work for their first cars and hobbies as a vehicle for learning the value of money and hard work.
Families that simply allow their children to not work during adolescent years are doing their children and family business a great disservice. Children should be required to have part-time jobs outside of the family business in their adolescence – it’s a great character building strategy.
4. Not understanding the value of creating your own unique identity and personal branding
One of the healthiest things for any young person is to develop their own unique identity. It’s never the goal to simply be a clone of earlier generations. One of the greatest regrets I see with 40-year olds that immediately went into the family business is their own desire to have developed their own unique brand before entering the family business.
Unique personalities and brands are built outside of the family business and then can be great assets and contributions to the business when they enter in their mid to late 20s. Nothing builds confidence more than having success outside the walls of the family business.
5. Being unwilling to be challenged, stretched and grown as an individual
All great athletes and performers realize the importance of outside feedback and being stretched past their own perceived capacities. The next generation should be encouraged to find teachers, mentors and coaches that will help challenge them to achieve new levels of greatness in business and other realms.
6. Human nature is predictable
Growing up arrogant or overconfident in a successful family business can happen pretty easily. Great family leaders know and understand human nature and create leadership and narratives within a family that help the future generations not fall into the easy traps of family success.
Be a leader and be courageous about demanding more from your future generations and challenging them to avoid the common pitfalls of family success and wealth.