Despite what some may think, family businesses don’t simply rest on their laurels and stay the same. “Family succession events, where the new generation comes in, frequently result in the renewal of the family business,” Greve said. Indeed, according to a recent survey, 60 percent of INSEAD alumni associated with family businesses executed turnarounds, mostly around market or product expansion.
For family businesses to thrive in their entrepreneurial pursuits, it’s essential for younger family members to be equipped with the knowledge and tools to be effective entrepreneurs. One way to do so is to ensure that they gain experience working up the ranks of an organisation outside the family business – somewhere where they are just regular employees.
“When the time is right, they can come back and use the knowledge they have gained to execute a renewal,” Greve said. “Ultimately, every business and every business decision is all about people. It’s about their thinking and their tools, and how they can make that come together in an entrepreneurial action to renew the business.”