Pramodita Sharma presented to the Family Business Alliance on the importance of creating entrepreneurs in every generation of a family business.

1. TAKE AWAYS FROM FAMILY BUSINESS ALLIANCE EVENT
ENTREPRENEURS IN EVERY GENERATION:
HOW SUCCESSFUL FAMILIES DEVELOP NEXT GENERATION LEADERS
• Success family businesses pay attention to entrepreneurial skills at each generation.
• Find out the stories you tell in your family businesses and if the “hero” is a person as
opposed to character traits. Focus on character traits as opposed to a particular
person because it allows for those elements to be passed to a subsequent
generation.
• Consider having children work in the family business early in their lives and don't pay
them right away (to avoid them from developing an entitlement mentality).
• Develop “bridge leadership” if the next generation is not ready.
• Realize the effect “attribution theory” can have on relationships. Ask, my brother
was late (i.e. negative event) because of external v. internal factors or permanent v.
temporary factors. Ask, my sister brought me a surprise gift (i.e. positive event)
because... Determine how this affects your relationships.
• Ask who is your family (i.e. blood, cousins, living together, spouses, etc.). Who can
have an active role in the business? Who can be an owner? Consider broadening
the concept of who is a member of your family.
• Do you speak about “my” v. “our” family and who makes decisions about the
business (i.e. just senior generation, or joint with next generation). Also ask if one
person’s voice is heard or the entire generation.
• In Japanese business culture, families will legally adopt a very capable business
person or have that person marry into family. This causes family members to be
work harder as opposed to becoming complacent and feeling entitled.
• Children are taking longer to make decisions on adulthood because there are more
options. Also, they have a longer expectancy and are working longer. Expect that
they may not get involved in the business or be ready until later on in life.
P. Haans Mulder, JD, MBA, MST, CFP®
321 Settlers Road
Holland, MI 49423
616.392.1821
phmulder@cunninghamdalman.com

2. 2
• Focus on the four Ls of family business: learn business, learn “my” business, learn
to lead, and learn let go.
• Determine someone’s talent set and give them smaller opportunities to develop it.
This may include volunteer opportunities in your community. It takes 10,000 of
hours to be great at something.
• Determine the entrepreneurial opportunities-new products, new markets, and new
products and markets.
• Ownership, management, and governance (OMG) is very important so there is room
for a number of family members. In doing that, you should figure out what “shoe fits
best” for each family member (i.e. what of the OMG roles should fit in).
• Focus on the five Ps: purpose, planning, polices, process, and parenting.
• For purpose, use it to create and energize. Most families struggle to develop a
concise purpose. Create a vision and define a milestone over a period of time (i.e.
how are you going to celebrate your anniversary at 10, 20, 30 anniversary, etc.)
• For parenting, determine how to balance what is important to the family (roots) and
give them an opportunity to act (wings). Parents should set high standards and
expectations. However, when a child falls, help him or her back up again.
• For process, absorb and listen to ideas of different generations.
• Encourage children to have a personal advisory board (to share their thinking and
get feedback).