Tips for Preparing the Next Generation to Take Over the Family Business

 

Studies show that less than 10 percent of family-owned businesses make it to the third generation. While there are many reasons for this including market forces, one of the biggest reasons is that the subsequent generations aren’t interested nor prepared to take the lead. However, this doesn’t have to be your company’s story. You can ensure the next generation takes an interest in your company by:

1.       Sharing the history and vision of the business with them

This is something that you should start as soon as possible. Hearing stories of how the business was established and what the founder’s vision was will help to instill a sense of pride in your children. You can choose to write the story down or even simply discuss it with them while viewing photos or videos that highlight the business’ history.

2.       Expose them to the business early

Start exposing your children to the business early. This could be as simple as taking them along with you to work on a weekend to tour the facilities. When they are older, you can create opportunities for them to start taking a more active role in the business. For example, they can take on a part-time job during the summer holidays or an internship for credit at school.

Exposing your children to the business early gives them a better understanding and appreciation of the business. They are more likely to have an interest in the business this way, or find opportunities where they can fit in when the time comes.

3.       Establish a policy for employing family

Many family businesses fail because the next generation views them as a fallback option if other opportunities fail. They are employed by the company, yet they do not have the skills or qualifications for the position.

It is important to have an employment policy that ensures you only hire members of the family that are not only qualified but also enthusiastic and skilled. This will ensure that your business grows.

Use the tips above to nurture interest in the next generation and ensure the longevity of your business.

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