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You built this. From the ground up. You poured your heart, soul, and sweat into creating something lasting, a legacy. This is a mantra held dear by many a founder or family enterprise owner. But you know better than anyone that preserving what you’ve built isn’t enough. It’s about relentless forward motion, about architecting a future even bolder than the present. It’s about intentionally cultivating the next generation of leadership – whether they share your last name or not – to propel this enterprise to even greater heights. Too often, family enterprises stumble because they underestimate the critical need for continuous, professional leadership development. They assume the next generation will naturally rise to the occasion. But hoping isn’t a strategy. When the time comes to identify and prepare successors, they discover the process is far more complex and time-consuming than anticipated. This delay creates two critical risks: it undermines the future stability of the organisation, and it allows high-potential leaders to slip through the cracks. Our research shows that a staggering 71 per cent of leaders in family enterprises globally are considering moving on, with 36 per cent citing career advancement as their primary motivation. In Asia, despite a prevalence of large family businesses, only very few first, second and third generation businesses have demonstrated the success that can be achieved through professional management development practices. Nevertheless, the success of this minority sets the benchmark and provides a blueprint for success. Think about that: your most valuable players might be walking out the door because they don’t see a clear path to growth within your vision. Based on our experience advising family enterprises worldwide, we’ve identified a clear path forward: embracing professional management principles to identify and develop both family and non-family leaders who can drive the enterprise forward. Here’s how to build that leadership pipeline Align on the success profile: Define what “great” looks like The first step is brutally honest alignment among family stakeholders on what constitutes success for the next generation of leaders. This isn’t always easy – it demands time, open communication, and a willingness to challenge assumptions. But when you collectively define a clear success profile, you mitigate potential conflicts, reduce bias, and create a robust framework for leadership development. Don’t fall into the trap of cloning yourself. Instead, envision where your organisation will be in 5, 10, or 15 years – and develop a success profile based on that strategic journey. Outline the culture and values a leader will need to embody to safeguard the enterprise’s legacy. The world is changing at warp speed, and leadership must evolve with it. Ensure your success profile reflects the future needs of your organisation, not just the present. Assess potential, not just experience: Look beyond the resume Another common pitfall is overlooking the importance of systemic talent development. This leads to promising leaders going unnoticed and undeveloped. Leadership isn’t about inherent traits; it’s about systematic development and opportunity. Avoid making leadership decisions solely on existing experience or current competencies. Instead, focus on the potential of leaders to evolve and embark on a continuous learning journey. This is crucial in today’s volatile and complex world. Our leadership portrait approach helps us understand the specific traits that determine whether someone is likely to thrive in a leadership role. The best part? These traits can be developed with the right interventions at the right time. Curiosity and adaptability: Leaders who embrace continuous learning, balance preservation and progress, and are open to fresh ideas. Drive and resilience: Leaders who inspire confidence during challenging times and are motivated to overcome obstacles. Social intelligence: Leaders who actively listen, understand interpersonal dynamics, and adapt their communication style. Systems thinking: Leaders who synthesise information, connect disparate dots, and make informed decisions. Supercharge next-generation leadership development: Invest strategically Invest in external coaching and mentoring: Family dynamics can complicate internal mentorship. Seek independent mentors and coaches who provide objective guidance, developing skills and confidence without the emotional baggage of family relationships. Give insiders an outsider’s perspective: Nurture critical thinking and alternative viewpoints by exposing family members to different companies in the portfolio, external work experiences, or other family executives. Provide opportunities for increasing autonomy and responsibility, allowing future leaders to see all aspects of business operations and decision-making. Look beyond the next generation: Don’t focus solely on immediate successors. Imagine how talent might fit into the enterprise as it evolves, and build a strong leadership pipeline that starts early and leaves no gaps. This builds organisational resilience and prevents being caught off guard by unexpected departures. Securing your legacy Remember, you’re not just filling a role; you’re securing your future. The leaders you develop today will determine the business’s trajectory for decades to come. Don’t see leadership as a birthright or a predetermined path. Leadership is developed, nurtured, and carefully cultivated. Your enterprise’s most valuable asset isn’t its current balance sheet; it’s the potential of the people who will write the next chapter. Embark on a continuous journey of leadership development. Assess, develop, and believe in the leaders you can create. That’s how you build a legacy that endures. Editor’s note: e27 aims to foster thought leadership by publishing views from the community. Share your opinion by submitting an article, video, podcast, or infographic. Join us on Instagram, Facebook, X, and LinkedIn to stay connected. We’re building the most useful WA community for founders and enablers. Join here and be part of it. Image courtesy: Canva Pro
