Family Business: Bump & Beyond

Succession in our company has always been a big challenge. Everyone understands that the transition needs to take place but no one understands when and how this will occur. As long as the steering wheel remains firmly in the hand of the old one, the young ones wait in patience or quietly retreat in the background. We have conversed but failed to conclude anything. Passing on the leadership mantle is an elusive idea, masked under presumptions and unarticulated expectations. The vagueness affects not only the future—our day-to-day choices get influenced too. Without role definition and timelines, we're taking decisions in the short-term, avoiding bold decisions, and not committing too far ahead. The paradox lies in the irony: current leaders require effective successors but do not want to provide space to grow. Faith in theory but not in application. And unless that changes, we're all stuck in limbo—doing the best with what we have but never knowing if the path forward leads to leadership or nowhere in general. Succession is a process, not a plan. And in family businesses, it's as emotional as it is strategic. If we don't impose structure, we risk turning legacy into uncertainty.

Family firms integrate tradition, relationship and aspiration. Family firms have strong commitment, long-term orientation and trust but the convergence between ownership and management and between ownership and family creates emotional entanglements that can pervert decisions and suppress innovation. One of the greatest challenges that face us is succession. The founders hold on tight, and subsequent generations strain to break free. It is a tug-of-war between retaining the tradition and bringing in the new—a dynamic the authors have termed the succession paradox. Since only 12% of family-run companies survive to the third generation, clearly feelings won’t be enough to carry the day. Open communication, good governance, and a blending of family values and business professionalism must prevail if long-term survival is to be ensured. If they work correctly, they can actually perform better than others. It begins with the understanding that succession is not a metaphor—It's a process strategy.

At the moment, our family company lacks a structured succession strategy. A few casual talks have taken place about "who could take over," but no formal documentation or consensus has resulted from them. Different expectations of the future can cause great conflict, particularly between the older and younger generations. While some of the younger in the generation are thinking more long-term—how to modernize, grow, or even just keep things going smoothly if someone unexpectedly steps back—the older generation tends to operate with a "we'll figure it out when the time comes" attitude. This uncertainty makes people hesitant to act as no one actually knows exactly what their future function will be. It also has an impact on daily dynamics. Occasionally, decisions are taken with short-term thinking since there is no obvious future responsibility allocation. It might cause dissatisfaction misinterpretations, and even a worry that all the effort being put in today will not be acknowledged or carried on correctly later on.