Now Gen and Next Gen need to be on the same page

Collette Schultz

family transitionNow Gen owners of family businesses owe it to the Next Gen to start the discussion of how the transition will occur, how it will be paid for, and when it will occur.

Original post By Julie Bogle, Partner – Smith & Gesteland, LLP

I recently had the good fortune of spending a few hours with about 20 “Next Gen” future leaders of family businesses. This discussion was sponsored by a trade group that these businesses belong to. The industry these family businesses belong to is being challenged by market forces they can’t control, including online retailers such as Amazon, the aging of their core clientele, poor treatment by the manufacturers that supply their products, and the pressure every business faces these days to do more with fewer resources.

They’re also facing the transition – sooner or later — of their family’s businesses to them as owners, employers, and key decision makers.

These Next Gen leaders, like most Gen Xers and Millennials, are extremely well-informed about the society they live in and the pressures that face their businesses. Their trade association has done a great job of drilling into them the metrics they need to understand and the challenges they’re facing. They grew up talking about business issues at the dinner table, which is where so much of the training for future business leaders occurs. They accurately understand the financial and personal risks.

I thought these Next Gen leaders would be afraid, maybe unsure that taking over the family business was the right thing to do, nervous for the future and the financial stability of their own growing families. I was wrong.

The key attribute of these Next Gen leaders is first and foremost pride in the family business and the legacy their families created. They are, without exception, eager to continue the family tradition and ensure their family’s legacy is available for future generations. They understand that family businesses create family wealth, despite challenges and market forces that threaten to eat away at the stability and opportunity that wealth creates. They also understand family businesses create opportunities, not only for their own family members but for the support of their employees and their employees’ families.

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