KACHARAGADLA

Carefully identifying and properly developing the next generation of leaders is by far the most consequential decision for any family business founder, owner, or leader. However, all over the world — from the Americas to Asia, from Europe to Africa — many family business leaders are quick to assume that some of their children or other relatives would never become great successors. Most consider only one person (will he or she make a great CEO?), rather than thinking of many key family members and the multiple critical potential roles they can play. What’s more, even among those leaders who want to conduct rigorous assessments of the entire next generation’s capabilities, most don’t know what they should focus on, and many wait until the eleventh hour to ask the crucial questions. Consider the CEO of a family-owned business in Buenos Aires who called me in as a consultant. The executive, who was in his seventies, began our first meeting by leaning forward and saying to me, in

The great secret of business families that achieve tremendous wealth and hold onto it for generations is that they persistently promote the entrepreneurial spirit that led to their initial success. That drive — a combination of ambition, sheer will, and the willingness to take calculated risks — is integral to long-term success, particularly in challenging times. One third-generation family CEO we know recently delivered a powerful message to his teenaged next generation when he said, “In times like this, a lot of companies will go bankrupt. But, because we’ve always run our family business on the tenets of entrepreneurial drive and diversification, our family business will survive this crisis and be in a position to prosper in the long term. Learn from this experience and think about what you can do as an entrepreneur.” This is valuable advice, not just for the younger generation as they grow and develop as individuals, but also for the future of the family businesses in gen

A culture conducive to innovation is not only good for a company’s bottom line. It also is something that both leaders and employees value in their organizations. In seminars at companies across the globe, I have informally surveyed hundreds of managers about whether they want to work in an organization where innovative behaviors are the norm. I cannot think of a single instance when someone has said “No, I don’t.” Who can blame them: Innovative cultures are generally depicted as pretty fun. When I asked the same managers to describe such cultures, they readily provided a list of characteristics identical to those extolled by management books: tolerance for failure, willingness to experiment, psychological safety, highly collaborative, and nonhierarchical. And research supports the idea that these behaviors translate into better innovative performance. But despite the fact that innovative cultures are desirable and that most leaders claim to understand what they entail, they are

We are drawn to the stories of effective leaders in action. Their decisiveness invigorates us. The events that unfold from their bold moves, often culminating in successful outcomes, make for gripping narratives. Perhaps most important, we turn to accounts of their deeds for lessons that we can apply in our own careers. Books like  Jack: Straight from the Gut  and  Execution: The Discipline of Getting Things Done  are compelling in part because they implicitly promise that we can achieve the success of a Jack Welch or a Larry Bossidy—if only we learn to emulate his actions. But this focus on  what a leader does  is misplaced. That’s because moves that work in one context often make little sense in another, even at the same company or within the experience of a single leader. Recall that Jack Welch, early in his career at General Electric, insisted that each of GE’s businesses be number one or number two in market share in its industry; years later he insisted that those same busi