Do you know that only one-third of the family business has transitioned to second-generation leadership? In fact, statistics show that this number has dropped to 19% in the last couple of years.  

According to a PWC survey in the States, “only one-third have a robust, documented, and communicated succession plan in place, and globally, only 24% of family businesses are focused on next-gen involvement.” 

Ever wondered why it happens? Why are more businesses not passed down to the next generations? Why are younger generations no longer interested in taking on the responsibility of handling their family business? The common reasons why it happens are either due to unawareness, unpreparedness, or unwillingness.  

Let’s learn how to overcome these obstacles and prepare the next generation to run the family business. 

Progressive Developmental Experiences 

When family members are allowed to move through the company, it enables them to learn various business aspects. Gradually, they gain technical competence in different areas and learn to manage work groups. This helps them to learn business mechanics and gain experience in general management of people. 

A few family-operated organizations even send their children to work somewhere else so that they can develop their perspectives. 

Business Goals and Operations 

Another way to prepare the next generation to run the family business is by offering them context about the goals and operations of your business. You can explain the value or importance of building a business, the mode of operation, or finance.  

During dinnertime, you can talk about the products and services your business offers, the future of your company’s mission, or how much it means to be responsible for the livelihood of employees.  

Integrity 

Integrity is important when it comes to preparing the next generation to run a family business. All families have some sort of dysfunction and individual family members can develop a few bad habits. Therefore, you must insist on integrity and not ignore negative inclinations. If these “childish” tendencies are not addressed early, they may end up damaging the business.