Why Can’t We All Just Get Along? How to Overcome Family Dynamics in Legacy Planning

Think you’ve got plenty of time left before you need to start your business succession plan? Your kids likely disagree. Nearly six in 10 next-gen leaders say that the current generation’s hesitance to retire is a problem, according to PWC.² And if they’re feeling anxious and unprepared, you’re putting your legacy at risk. Research shows 25 percent³ of failed family business transitions happen because of an ill-prepared heir.

Ideally, your legacy plan will be in place well before it is implemented—whether that is months or years in advance depends on a lot of factors. Many families I work with only put off these discussions because they know they’re going to involve disagreements. And who wants to argue with family? But even if it won’t go into effect for five or 10 years, starting your legacy plan now gives both generations more time to address potential issues and get on board.

Plus, an early start will become invaluable if an illness, injury—or just the sudden urge for an extended vacation—prompts an unexpectedly early transition.

Before asking, “Who’s going to be the boss?” ask, “What are we about?” It’s easy to assume that everyone shares the same ideas about company culture and values in a family business. But you can avoid other misassumptions down the road by making sure you’re all starting with the same idea of what your business is all about. A 2021 survey⁴ found family businesses with written values were better prepared for succession than those without.

Start getting down to business—by brushing up on your active listening skills. Fewer than one in three business-owning families⁵ say that their family’s listening skills are good, and just over a quarter rate them as average. The reasons they tend to talk past each other are as obvious as they are hard to shake: Older generations believe that they know best based on decades of experience; younger generations believe they know better based on today’s markets and future-facing ideas. Often, they’re both partly right.

Don’t hesitate to bring in a conversation facilitator⁶ to help with tricky topics and ensure everyone is heard. It’s not a judgment on your family closeness. It’s a sign of love and respect that you want to keep things civil, fair, and well-communicated.

Another strategy to try: round table, a discussion method that encourages active listening. Everyone at the table is given a specific amount of time to express themselves, and no one else speaks during that time.

Your legacy plan will cover more than just your business, which is an opportunity to find common ground. Philanthropy can be a shared goal across generations, even if they feel passionate about different causes or charities. A Blackbaud study⁷ found that Baby Boomers like giving to local social services organizations and religious institutions, while Gen Z prioritized giving to benefit children and animals. Get involved in intergenerational compromise by finding ways to agree on how to give.

Does the long-running family foundation feel more like a hassle than a privilege for the younger generation? Giving in a different way, like through a donor-advised fund, could allow your family to move forward with multiple giving priorities and less time commitment. This type of win-win can help both generations realize consensus is possible and motivate everyone to bring the same open-mindedness to the business succession planning table.

A family business I once worked with had some of the traditional dynamics we’ve been talking about: The dad and founder of a manufacturing company was hesitant to let go of the old way of doing things. The son had a big idea to innovate. Ultimately, the son was given some latitude to invest in his vision—and grew the company 24 times its original size.

Now, I know that isn’t going to happen every time. Sometimes, the next generation is going to fail. But experts tell us that the way to build resilience in the next generation of family business owners is to give them room to fail.⁸

To a parent and someone who spent their life building a business they love, it can sound like utter madness. But then, when I ask a founder to tell me some of the biggest lessons they learned over the course of growing their business, so many stories are about risks, failures, and near misses. Understanding how valuable those learning experiences were for them helps leaders realize how important it is to give the next generation the chance to learn by doing as well.