Besides developing, supporting, and participating in the governance system, leaders in family businesses need to lead people, and this is different from managing their work. Leading is fundamentally about identifying where the family business needs to go (developing a compelling vision for the future), strategising how to get there, and getting people to change in order to get there. This is done by inspiring, persuading, and motivating people to work together to reach important goals, and by building coalitions to support needed change.
Leading is a very personal activity where the leader connects with people and convinces them, making use of compelling ideas and character appeal. Followers follow the leader because of their loyalty, because they identify with the leader, because they identify with the leader’s cause, and sometimes because of all of those things. Followers need compelling reasons to file in behind any leader for the long-term, or for difficult missions. Since family business is focused on the long term, the family business leader or leaders must be personally compelling, not just good at making plans and managing activities. As the saying goes, you lead people into battle; you don’t manage them into battle.
Effective leaders can have a charismatic style or a more quiet approach. Regardless of style, the most effective leaders I have seen in family business systems are clearly “servant leaders” or more to the point, “servant partners.” These leaders typically have strong ideas and principles about how their companies should be run, what their co-owners should invest in, and how their families should behave. They also have egos, personal needs, and sensitivities. At the same time, they want to do their best for their followers. They believe in partnering with others and treating partners fairly. And they behave like servants of the greater good. Finally, they are able to make tough decisions to protect the standards and aspirations of the group.
In the last Family Business training session being held tomorrow, 1st September, at the Chamber’s Exchange Building in Valletta at 5pm, I will be speaking about leadership in family business and how this touches upon setting a family employment policy, preserving family wealth, managing conflict and managing the risks of losing the family business. To register please CLICK HERE.