Álvaro Cárcel, Partner.
On many occasions, succession in family businesses is approached from the perspective of the company, and questions arise such as the following: What will happen to the new ownership? Will there be major changes in the business? Will important pieces of the management team be changed? Where will the strategy go?
However, the issue is rarely addressed from the perspective and first-person experience of the successor, and this is precisely what was discussed at an event organized by Esade on May 29, moderated by Manel Blanco, Partner at KMPG, and in which we were able to listen to the experiences of Maria Coll, CEO of Chocolates Simón (sixth generation of the family), and Francesc Julia, CEO of Kave Home (2nd generation of the family).
The aim of the article is to summarize some of the reflections that were presented, complementing them with our own experience accompanying family businesses in times of transition, thanks to the incorporation of management profiles.
The Continuity of the Family Legacy
The session highlighted the importance of preserving the values and culture established by his predecessors. In other words, when it comes to taking over the general direction and succeeding the previous generation, it is key that the successor honors the past in order to be able to successfully transform the future.
Have previous experience in other environments first, and then join the family business in a specialist role
Growing up in other environments, other sectors, other types of companies, helps to have a broader perspective of the business environment, and undoubtedly has a positive impact on the future path within the family business. On the other hand, both speakers agreed that it is a good idea to start in the company in specialist roles, and gradually grow, organically, within the organization.
The Importance of Surrounding Yourself with “bridge” People and External Coaches
Surrounding yourself with veterans in the organization, who have a historical vision of the company, helps to take a certain perspective and have information that accelerates the integration process. On the other hand, having the support of external coaches helps to reduce emotionality.
Be able to manage resistance to change
Sometimes, new generations bring a new vision to the project (although both insisted that it doesn't always have to be this way). In this case, it is very common to come up against a certain resistance to change, which can be broken with empathy, resilience, long-term vision, and can be accelerated thanks to the progressive incorporation of catalysts of change into the team, with enough sensitivity not to break the difficult internal balances.
Create governing boards, family protocols, and structures such as an Advisory Council
The configuration of governing boards, and the establishment of family protocols, should ideally be carried out before they are necessary. In this way, possible future conflicts are limited. On the other hand, the Advisory Councils help to objectify the intuition or "romanticism" that the family may feel for the business.
Preserving culture, despite bringing in new talent
To this end, the importance of signing people for their values, and not so much for their experience or curriculum, was discussed. The people who vibrate with the project are the ones who help preserve the historical values.
The best time for succession to happen?
Unfortunately, there is no golden rule, and every organization is different, and their tempos will be different, too. But it is important to analyze whether the successor has something differential to bring to the company (for example, experience in internationalization if the company aims to internationalize, or experience in B2C if the company intends to start selling directly to the end consumer). Otherwise, it is better not to force, and to take the necessary steps to properly prepare the successor.
Conclusion
The succession process in family businesses is a complex challenge that requires a delicate balance between preserving heritage and adapting to new realities. The continuity of the family legacy is critical, and successors must honor the values and culture established by their predecessors while implementing transformations necessary to prepare for the future.
In this process, the "succeeding generation" often enters into a kind of grief and a sense of loss of control. On the other hand, the "successor generation" may feel a certain vertigo, and above all feel the "weight" of carrying on their shoulders the responsibility of leading and preserving the family legacy. It is essential that both collaborate, respect each other, and leave each other the necessary space to achieve the success of the process.