Embracing the Next Generation

In the ever-evolving landscape of family businesses, continuity and succession planning are paramount for longevity and success. In NH, 85% of businesses are estimated to be family owned, and they are the driving force of our state’s economy. This trend becomes even more important as the United States is racing toward a tipping point: The younger baby boomer generation reaches 65 this year, initiating the biggest wave of retirements in the nation’s history. These retirements will transform the workforce and family businesses.

The CEO & Family Enterprise Center at UNH’s Peter T. Paul College of Business and Economics is paying close attention to the stark demographic statistics above. Given the business landscape today and those overall demographics, the key to the future of family businesses lies in supporting the next generation. What matters to them the most? What is the next generation thinking? Are we adequately preparing the successors who will carry the torch forward?

In a recent program with both the senior family members and the next generation in the room, the center opened the floor to the next generation of family business leaders to ask them just that: What matters most to them?

Mentoring and Training
The next generation is concerned with establishing their own credibility. They recognize that the generation before them looms large and they have big shoes to fill. Their future success often comes down to the ability to maximize the skill sets of the two ownership generations. Leadership development isn’t just a set of buzz words; it really means allowing the next generation to find their own management style and voice while supporting skill building. Some of this is based on experience and on-the-job training. Having the senior generation mentor and guide young people allows current leaders to hand over the baton in a measured and consistent way. Setting a plan in place is crucial to both ensuring the transfer of management responsibilities and making sure employees and customers are ready for the transition.

Culture Matters
The famous quote from renowned management consultant and author Peter Drucker that “culture eats strategy for breakfast” rings true for the next generation leaders of family businesses. It is a big leap from working in a family business and contributing to its culture to actually setting the culture and leading a cultural change. The next generation of leaders needs to take what worked and add their own spin. They have a distinctive advantage of experiencing the culture of the company from within the ranks; this gives them an insider view of what works and what doesn’t. They can then tweak and adjust as they make their way up the management chain. Their company’s team and culture will evolve as they do. A phased retirement approach can lead the way to a successful leadership hand off.

Life/Work Balance
The next generation of family business leaders has a different perspective on work/life balance. The rapid advancement of technology, including AI, and the rise of working from home have created opportunities and challenges that prior generations did not have. What matters to today’s family businesses is finding a blend that allows for optimal performance along with growth and self-actualization. The pace of change is faster today.

Future family business leaders are not merely seeking to inherit a title. They are eager to earn their stripes and become equipped with the knowledge and skills necessary to lead with purpose and resilience. 

Michelline Dufort is executive director of the CEO & Family Enterprise Center at the Peter T. Paul College of Business and Economics at the University of NH in Durham. The center runs the Family Business Program, and for three decades has fostered leadership skills, facilitated strategic planning, and addressed the unique challenges that come with family-owned businesses through monthly programs open to any member of a family-owned business. The center also launched Next Generation Peer Groups solely for the up-and-coming leaders. Dufort can be reached at Michelline.dufort@unh.edu or 603-862-1107. For more information visit paulcollege.unh.edu/ceo-family-enterprise-center.