Business and family leadership

Watch Professor John Davis of Harvard Business School talk about the dual leadership roles in the business and the family and the importance of transitioning these two roles from one generation to the next. In a family business, it is important to have a business leader, who is focused on motivating performance, as well as a family leader who is focused on family cooperation.

You don’t get much done in any system in my view, unless you have strong, capable and supportive leadership. Where does it come from though? Almost always, the leadership that’s effective in these, in these systems um, formally is exerted by the business leader. But almost always in these systems there is a very strong facilitating leader in the family that convinces people to, to work together, that helps people communicate better, that brings people together who have differences, a very strong process leader um, that is capable of developing the trust and the sense of compassion really, in the system that really keep it together. And um, the business leader is supportive of that but typically is much more task or goal driven, and uh, but tends to be kind of the, the inspiring uh, leader in the system. So this other leader works more quietly, doesn’t get as much attention but seems to me to be essential. It’s, it’s part of a dance. One of the interesting questions then is how are those leadership roles transferred into the next generation? When we talk about leadership in a family, we’re, we’re inclined to think about a parent. And what siblings don’t want one of their members to become their parent. And so having a different kind of leadership that comes from a sibling in the family but is not parental is not a well-defined role in my view. That sibling generation has very complex uh, dynamics. It’s difficult enough to pass business leadership to the next generation. But I think it’s more complicated to pass family leadership into the next generation for a variety of reasons. The unwillingness of siblings to recognize one of them as a, as a family leader is even more pronounced I think then to recognize one of them as a business leader. It’s difficult for families to make that adjustment. So then when somebody takes leadership action, they may not have a formal leadership role in the family but they step forward and they lead, that can either go, come, come across as a relief and um, appreciated or it can be seen as um, disruptive or out of character or inappropriate. And I think that’s something that we need to help families um, work on.