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Succeeding Generations: Realizing the Dream of Families in Business
Finding the right successor to a well-loved founder or president is often the most difficult task an organization can face—and the challenge can be even greater for family-run businesses. Succeeding Generations explores leadership transitions in family businesses, offering a clear-eyed assessment of the different options, from direct succession to building partnerships between siblings and cousins.
Family-owned companies may dominate the worldwide business landscape, yet surprisingly few are successfully passed down from one generation to the next, and fewer still reach the third generation intact. Author Ivan Lansberg, an organizational psychologist who grew up in a family business, examines the reasons behind this high failure rate and reveals the factors that contribute to long-term success. He offers practical advice on how to mentor successors, how to set up a systematic selection process, and how to make the best use of the board of directors during times of transition.
With a wealth of examples from companies in the United States, Europe, and Latin America, Succeeding Generations provides a thoughtful and comprehensive look at the sensitive dynamics of leadership succession in family businesses.
Family-owned companies may dominate the worldwide business landscape, yet surprisingly few are successfully passed down from one generation to the next, and fewer still reach the third generation intact. Author Ivan Lansberg, an organizational psychologist who grew up in a family business, examines the reasons behind this high failure rate and reveals the factors that contribute to long-term success. He offers practical advice on how to mentor successors, how to set up a systematic selection process, and how to make the best use of the board of directors during times of transition.
With a wealth of examples from companies in the United States, Europe, and Latin America, Succeeding Generations provides a thoughtful and comprehensive look at the sensitive dynamics of leadership succession in family businesses.
- GenresBusiness
400 pages, Hardcover
First published July 1, 1999
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34 people want to read
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January 2, 2018
3.5 stars.
The majority of parents decide to leave things equally to all of their children. This is a huge mistake. It is certainly nice for the children who didn't do well financially, but it doesn't recognize and appreciate the ones who did, effectively creating a family culture that doesn't value or reward excellence and success. Instead of rallying around (and keeping) the next leader of the family, families that take this path lose their best and brightest in every generation. Thus the result is that the very people that would have been able to hold the family together and help it to rise are the ones that must leave their families in order to excel. These families will not rise.
The less war, the more rich you will be. This applies to families (don't get divorced! promote sibling harmony!) and countries. This makes me wonder about the Guns, Germs, and Steel debate. Despite all the wars in Europe, is it possible they were still more peaceful than the tribes of Africa and the Americas and therefore able to get richer? You cannot have large cities without a certain amount of order and peace.
Overall, this book tried to do too much. The author needs to pick one type of succession to focus on and go deeper. Or he could choose one generation to stick to. Lots of great information in here, but not focused enough. Author doesn't have a new idea, an opinion of his own, that is why his book is a mess. It's like a summary of all the best ideas he has read, but he has no conclusions of his own to add.
Quotes:
"Every mom-and-pop grocery store as well as family-controlled multinational shares this challenge with kings and queens, prime ministers and presidents, sultans and popes, who down through the centuries have had to arrange for an orderly transfer of power from one generation to another without discord and feuding and civil war."
"Family enterprises are highly personal systems that evoke the same depth of feeling in the participants that most people reserve for their children and their marriages."
"What drives all successions is a vision of the future, hammered out over time, that embraces the aspirations of both the senior and the junior generations."
"Succession is a process, not an event."
"Ideally, as we will see, these discussions begin early in the life of a business family, when members of the next generation are young. Indeed, I believe that members of the younger generation are more inclined to connect their Individual Dreams to the Shared Dream when an open dialogue about these aspirations begins early in their lives and they feel free to pursue their individual Dream even if it leads to a career outside the business."
"A great burden is lifted from the shoulders of the young when entry into the business is seen not as an obligation, but as one among several career options."
"One gets the feeling in families like the Lombardis that the business is important not just for making money but as a place where they can do what they enjoy most, which is working together."
"Success, however, depends heavily on whether the talents and skills of the siblings ... are willing to accept the role for which he or she is best suited. There is evidence that differentiation in skills, and even in personalities, grows naturally in families... In many effective sibling teams, there is one partner who is good with numbers and excels at quantitative tasks, another who is gregarious by nature and loves to be involved in sales and marketing, and a third who is a gifted strategist always thinking two or three moves ahead."
-Skipped lots of great stuff about nepotism and how every heir has to earn the right to be king and needn't be insecure about it, but needs to get to work earning his position.
"The many succession tragedies documented in the family business literature show that when left to their own devices, senior leaders often abuse their prerogative to manage their own retirement."
"Business leaders in their mid to late sixties must come to terms with the fact that time is running out on the unrealized aspects of their Dreams. Inevitably, people of this age face the realization that much that they set out to do in their lives will be left undone.... With every passing day, the master builder becomes more keenly aware that no matter how hard he works, he will never live to see the completion of his cathedral. Many driven entrepreneurs react to this painful realization by wanting to pack yet more activity into their allotted time. Ironically, some push themselves relentlessly to exhaustion, accelerating the very aging process that terrifies them."
"Older people are coping with defective vision or hearing, heart disease, cancer, and other chronic ailments. The symptoms of loss of mental acuity ... they are slowly transformed into charicatures of their former selves... the slow deterioration of personality and intellect because of impaired insight and judgement and the loss of affect. The progression of the condition is more painful to the beholder than to the person."
"Mothers can play crucial roles in harmonizing the competitive dynamics among rival siblings. For many business families the death of the mother--rather than that of the all-too-dominant father--becomes the most traumatic hurdle to overcome during the process of generational change."
"The fundamental tension described by Erikson suggests that business owners unable to overcome their sense of despair will be incapable of mobilizing the courage and internal resources necessary to relinquish their control over the family and business decisions to the next generation. Their narcissism prevents them from appreciating and empathizing with the needs of their successors. They are incapable of viewing the next generation with the spirit of generativity that Erickson deemed essential to fulfillment in later life."
"So long as business owners remain preoccupied with the pursuit of their own heroic mission, thoughts about their psychological decline and ultimate death can be kept at bay."
"From a succession standpoint, Erikson echoed Dostoevskis insight that death must be first reckoned with before the magnificence of life can be fully appreciated and embrace. It is through the very acceptance of their own mortality that business owners marshal the courage and energy needed to plan the continuity of their organization. And, in so doing, they actually consolidate their legacy and their contribution to future generation--which, after all, is as close to any man or woman can come to immortality."
"Both the business and the family are in need of governance."
Rules: "Conflicts are inevitable--they actually serve to promote family harmony by anticipating disagreements and putting rules in place to settle them before they flare into major disagreements."
"It's better to have a good name than to be well known." (Group over individual) "Ask not what your family can do for you, ask what you can do for your family." And yet, no one will want to be a member of their family unless it serves them to be so.
"Embodied in the notion of stewardship is the expectation that the current family leaders will do everything possible to keep the family 'ship' in good shape during their tenure and then turn over the helm of an even bigger and more magnificent ship to the stakeholders and especially, to their children and grandchildren."
"Less than 30 percent of family firms last into the second generation and, of these, only about 10 percent make it to the third." 3% to the fourth. Which means these so-called advisors must suck at their advising. Probably better to stop taking their advice and instead study those 3% of families that do stay together.
The majority of parents decide to leave things equally to all of their children. This is a huge mistake. It is certainly nice for the children who didn't do well financially, but it doesn't recognize and appreciate the ones who did, effectively creating a family culture that doesn't value or reward excellence and success. Instead of rallying around (and keeping) the next leader of the family, families that take this path lose their best and brightest in every generation. Thus the result is that the very people that would have been able to hold the family together and help it to rise are the ones that must leave their families in order to excel. These families will not rise.
The less war, the more rich you will be. This applies to families (don't get divorced! promote sibling harmony!) and countries. This makes me wonder about the Guns, Germs, and Steel debate. Despite all the wars in Europe, is it possible they were still more peaceful than the tribes of Africa and the Americas and therefore able to get richer? You cannot have large cities without a certain amount of order and peace.
Overall, this book tried to do too much. The author needs to pick one type of succession to focus on and go deeper. Or he could choose one generation to stick to. Lots of great information in here, but not focused enough. Author doesn't have a new idea, an opinion of his own, that is why his book is a mess. It's like a summary of all the best ideas he has read, but he has no conclusions of his own to add.
Quotes:
"Every mom-and-pop grocery store as well as family-controlled multinational shares this challenge with kings and queens, prime ministers and presidents, sultans and popes, who down through the centuries have had to arrange for an orderly transfer of power from one generation to another without discord and feuding and civil war."
"Family enterprises are highly personal systems that evoke the same depth of feeling in the participants that most people reserve for their children and their marriages."
"What drives all successions is a vision of the future, hammered out over time, that embraces the aspirations of both the senior and the junior generations."
"Succession is a process, not an event."
"Ideally, as we will see, these discussions begin early in the life of a business family, when members of the next generation are young. Indeed, I believe that members of the younger generation are more inclined to connect their Individual Dreams to the Shared Dream when an open dialogue about these aspirations begins early in their lives and they feel free to pursue their individual Dream even if it leads to a career outside the business."
"A great burden is lifted from the shoulders of the young when entry into the business is seen not as an obligation, but as one among several career options."
"One gets the feeling in families like the Lombardis that the business is important not just for making money but as a place where they can do what they enjoy most, which is working together."
"Success, however, depends heavily on whether the talents and skills of the siblings ... are willing to accept the role for which he or she is best suited. There is evidence that differentiation in skills, and even in personalities, grows naturally in families... In many effective sibling teams, there is one partner who is good with numbers and excels at quantitative tasks, another who is gregarious by nature and loves to be involved in sales and marketing, and a third who is a gifted strategist always thinking two or three moves ahead."
-Skipped lots of great stuff about nepotism and how every heir has to earn the right to be king and needn't be insecure about it, but needs to get to work earning his position.
"The many succession tragedies documented in the family business literature show that when left to their own devices, senior leaders often abuse their prerogative to manage their own retirement."
"Business leaders in their mid to late sixties must come to terms with the fact that time is running out on the unrealized aspects of their Dreams. Inevitably, people of this age face the realization that much that they set out to do in their lives will be left undone.... With every passing day, the master builder becomes more keenly aware that no matter how hard he works, he will never live to see the completion of his cathedral. Many driven entrepreneurs react to this painful realization by wanting to pack yet more activity into their allotted time. Ironically, some push themselves relentlessly to exhaustion, accelerating the very aging process that terrifies them."
"Older people are coping with defective vision or hearing, heart disease, cancer, and other chronic ailments. The symptoms of loss of mental acuity ... they are slowly transformed into charicatures of their former selves... the slow deterioration of personality and intellect because of impaired insight and judgement and the loss of affect. The progression of the condition is more painful to the beholder than to the person."
"Mothers can play crucial roles in harmonizing the competitive dynamics among rival siblings. For many business families the death of the mother--rather than that of the all-too-dominant father--becomes the most traumatic hurdle to overcome during the process of generational change."
"The fundamental tension described by Erikson suggests that business owners unable to overcome their sense of despair will be incapable of mobilizing the courage and internal resources necessary to relinquish their control over the family and business decisions to the next generation. Their narcissism prevents them from appreciating and empathizing with the needs of their successors. They are incapable of viewing the next generation with the spirit of generativity that Erickson deemed essential to fulfillment in later life."
"So long as business owners remain preoccupied with the pursuit of their own heroic mission, thoughts about their psychological decline and ultimate death can be kept at bay."
"From a succession standpoint, Erikson echoed Dostoevskis insight that death must be first reckoned with before the magnificence of life can be fully appreciated and embrace. It is through the very acceptance of their own mortality that business owners marshal the courage and energy needed to plan the continuity of their organization. And, in so doing, they actually consolidate their legacy and their contribution to future generation--which, after all, is as close to any man or woman can come to immortality."
"Both the business and the family are in need of governance."
Rules: "Conflicts are inevitable--they actually serve to promote family harmony by anticipating disagreements and putting rules in place to settle them before they flare into major disagreements."
"It's better to have a good name than to be well known." (Group over individual) "Ask not what your family can do for you, ask what you can do for your family." And yet, no one will want to be a member of their family unless it serves them to be so.
"Embodied in the notion of stewardship is the expectation that the current family leaders will do everything possible to keep the family 'ship' in good shape during their tenure and then turn over the helm of an even bigger and more magnificent ship to the stakeholders and especially, to their children and grandchildren."
"Less than 30 percent of family firms last into the second generation and, of these, only about 10 percent make it to the third." 3% to the fourth. Which means these so-called advisors must suck at their advising. Probably better to stop taking their advice and instead study those 3% of families that do stay together.
June 10, 2018
Another business book that could have been a short article.
Displaying 1 - 2 of 2 reviews