Legacy is an invisible, invisible force that influences the decisions of the next generation in a family business.Psychologists say motivation for building a legacy generative, which stems from a concern for the well-being, well-being and safety of future generations. Developing and maintaining a legacy is a way for family members to perpetuate family identity and purpose. But is legacy always positive? Paradoxically, legacy has been shown to have both positive and negative outcomes for organizations and individuals. When heritage serves as a source of identity, inspiration and direction, it is an asset to the family business. On the downside, inheritance can also be a burden—an inherent paradox of inheritance. Companies can become so entrenched in tradition and “the way things have always been” that they limit innovation, change, and organizational agility. The challenge for family business leaders is to manage this traditional paradox.
Jon M. Huntsman, founder of Huntsman Corporation, passed away in 2018. When I asked his son David Huntsman about his father’s lasting influence as chairman of the Huntsman Foundation, he said: “As a family business, my father’s influence has always been in my life – whether I have or not. Consciously recognize this. I know exactly what he will say or do in almost every business situation because I have witnessed it for years. His influence, while he’s gone, still influences the little decisions I make throughout the day – the things I do or choose not to do. A part of him will always be with me, not only in business but in every aspect of life. “
Legacy is an invisible, invisible force that influences the next generation’s decisions in business and life. Legacy is also known as the “connective tissue” that connects generations of family businesses. Jon Huntsman’s values, beliefs and behaviors remain in the lives of his descendants long after his death. Legacy begins when the values, norms, knowledge and beliefs of previous generations are deeply ingrained in the current generation. Once embedded, the next generation of leaders becomes the “guardian” of the family/business legacy. Before inheritance was adopted, what constituted someone’s inheritance was only characteristic of the previous generation. But once rooted, the legacy becomes the belief that guides the subsequent behavior of the next generation.
Research shows that business founders, older generations and parents are motivated to build and maintain a legacy based on the moral and religious beliefs, knowledge, norms and values that work for them, and that they may have learned from previous generations themselves. Psychologists say build Inheritance Motivation generative, which stems from a concern for the well-being, well-being and safety of future generations. This desire is found more in family businesses than in non-family businesses due to a heightened sense of moral obligation to the past and future generations. Developing and maintaining a legacy is a way for family members to perpetuate family identity and purpose.
There are several prescriptions in the literature explaining how to build a legacy in a family business.For example, in the most recent Forbes In the article, Stephanie Burns argues that building a legacy requires doing the best, adding new business to an existing legacy, respecting the existing legacy and inheriting it. Stories, diaries, photographs and family assets such as land, factories and houses, as well as family symbols such as logos and rituals, are important vehicles for conveying heritage. These mechanisms can represent and communicate the deep-rooted beliefs, norms and values that make up the legacy of a family business. They can also play an important role in developing a lasting legacy for the next generation.
But is legacy always positive? Paradoxically, legacy has been shown to have both positive and negative outcomes for organizations and individuals. When heritage serves as a source of identity, inspiration and direction, it is an asset to the family business. Jay Barney’s research shows that it may be the only true source of sustainable competitive advantage for family businesses. Legacy is rare, not fully imitated, valuable and ongoing within a company – competitors can replicate products and processes, but it is impossible to replicate a company’s legacy.
For David Huntsman, the experience with his father is unrepeatable, rare and precious to him. He has learned from experiences that only he and his company have, and as a result, his father’s values and wisdom live within him and his company. His father’s legacy has always been good for the company and the family, and it makes sense to keep that ingrained legacy. Doing anything against this legacy would be against the values and norms that define their home and family business. Breaking away from tradition risks losing the competitive advantage family businesses have always enjoyed.
On the downside, inheritance can also be a burden—an inherent paradox of inheritance. Companies can become so entrenched in tradition and “the way things have always been” that they limit innovation, change, and organizational agility. Family members may feel trapped in the past, so they may face ethical dilemmas as they are forced to maintain their legacy and set aside their desire to build their own vision and strategy, which may ultimately be necessary to maintain and grow the company. There is a paradox in it: the need to live with embedded values, beliefs, behaviors, and knowledge of the past can conflict with the desire to innovate and move away from the legacy that has always defined them. Strong adherence to tradition creates organizational inertia, making it difficult for leaders to modify the company’s strategy, brand, and practices when necessary.
The challenge for family business leaders is managing the legacy paradox. This is the conflict between the mind and the heart. The responsible person may determine that changes are required based on sound logic and analysis of the situation. The heart may have an emotional attachment to the past. The result is a conflict between objective situational analysis and subjective intuitive beliefs. Should leaders be loyal to family heritage and heritage? always Worked in the past, or leaders should redefine legacy, family identity, and company possible Is it necessary in the future? This is one of the most difficult and painful decisions any family business leader will ultimately have to make. No family business leader wants to undermine the distinction between a family business and everything the family stands for. This is the main reason why we see family business leaders rationalizing “socio-emotional” performance (such as family unity and harmony) over the potentially higher financial performance of the family business.
At the end of the day, it’s a matter of creating and shaping a legacy that can grow and become part of the family business culture. A key part of a successful family business legacy is being the best at what the business does and having leaders who consistently contribute the competencies and strategies needed to keep it that way. A successful legacy cannot be so rooted in the past that it cannot effectively address change in an organization.Guardians of the legacy must take on the difficult task of managing stability and Change. Leaders must determine which values, norms and beliefs are eternally valid no matter the circumstances – because they are at the heart of legacy and must define the future identity of families and businesses.Beliefs, Behaviour and Knowledge no The core constrains the necessary changes and must challenge businesses and families to survive and thrive. In this way, a business can retain its core identity and maintain its competitive advantage.