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Developing the Next Generation of Leaders in Your Family Business

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

Is the Next Generation of Your Family Business Entrepreneurial Enough?

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

The Best Leaders Are Great Teachers

Kundapur Vaman Kamath was a teacher. But he didn’t work at a school or stand in front of a class. Instead, he delivered his lessons at the office—to the employees who served under him during his four decades as a senior executive at, and then CEO of, India’s ICICI Bank. Whether he was offering tips on stakeholder communication or explaining the importance of ambitious goals, Kamath treated each day as an opportunity to provide his direct reports with a customized master class in management . Over time, this approach transformed the company into a hothouse of leadership talent, accelerating its growth. ICICI became one of India’s largest, most innovative banks, and Kamath has been credited with molding a whole generation of the country’s banking executives. I’ve spent more than 10 years studying world-class leaders like Kamath to determine what sets them apart from typical leaders. One big surprise was the extent to which these star managers emphasize ongoing, intensive one-on-on

Cultivating The Essential Ingredient In Leadership: Energy

There is a very simple measure of the health and culture of any team or organization:  its energy level . Among high-energy groups, we witness motivation by inspiration. There is a buzz in the air. Individuals and teams are innovating, displaying enthusiasm and optimism about their work. In lower-energy organizations, we see motivation by tasks and timelines. There is a sense of busy-ness, but little excitement about the business of the group. In this article, we will examine the role of energy in leadership, including the novel perspectives of a military Special Operations leader who has lived leadership on the battlefield and in the boardroom. Leadership As Focused, Directed Energy When we examine the writings of those who have worked extensively with leaders and organizations, the energy factor pops up repeatedly. Tom Peters, in his book  The Little Big Things , explains that “the ‘business’ of leaders at all levels is to help those in their charge develop  beyond their dr

The Five Characteristics of Successful Innovators

There is not much agreement about what makes an idea innovative, and what makes an innovative idea valuable. For example, discussions on whether the internet is a better invention than the wheel are more likely to reveal personal preferences than logical argumentation. Likewise, experts disagree on the type and level of innovation that is most beneficial for organizations. Some   studies   suggest that radical innovation (which does sound sexy) confers sustainable competitive advantages, but   others   show that “mild” innovation – think iPhone 5 rather than the original iPhone – is generally more effective, not least because it reduces market uncertainty. There is also inconclusive evidence on whether we should pay attention to consumers’ views, with some   studies   showing that a customer focus is detrimental for innovation because it equates to playing catch-up, but   others   arguing for it. Even Henry Ford’s famous quote on the subject – “if I had asked people what they

10 Traits of Innovative Leaders

Many organizations would like their leaders to create more innovative teams. But how exactly should they do this? If you ask highly innovative leaders what makes them effective you are apt to hear, “Well, I don’t know. I haven’t thought about it.” Or they will make something up that sounds compelling. But the fact of the matter is that people who excel at something aren’t usually very good at pinpointing exactly what accounts for their skill. So to find out more, we conducted our own study. We began by collaborating with a respected organization in the telecommunications industry whose leaders scored well above average on most managerial competencies. We identified 33 individuals who scored at or above the 99 th  percentile on innovation, as measured by their peers, subordinates, and bosses in a comprehensive 360-degree feedback survey.  We believed these closest colleagues would have the most accurate view of what made this group of leaders stand out from the pack in this large

The 3 Es of effective board leadership

A study of successful board chairs across countries shows how they engage, enable and encourage boards Boards of directors often get media attention when something goes wrong. The board of VW, for instance, was recently in the news after it received a terrible corporate governance rating based on the 2015 emissions scandal and its fallout. Examples of how not to behave as a board are easy to come by. Yet most boards are not like VW’s because they use good governance to work well. To find out what makes a board chair successful, the INSEAD Corporate Governance Initiative conducted 74 face-to-face interviews with experienced board chairs to produce a research project spanning nine countries – Belgium, Denmark, Italy, the Netherlands, Russia, Singapore, Switzerland, Turkey and the United Kingdom. Since boards of directors are not always transparent, and the role of their chairs doesn’t come with a handbook, we hope this report will shed light on the workings of board chairs.