Steve Jobs wrote, “I hate it when people call themselves ‘entrepreneurs’ when what they’re really trying to do is launch a startup and then sell or go public, so they can cash in and move on. They’re unwilling to do the work it takes to build a real company, which is the hardest work in business … build a company that will stand for something a generation or two from now.”
Steve’s quote resonated with me, and was the inspiration for a talk I delivered at the Canadian Association of Family Enterprises (CAFE) yesterday. Family businesses have some of the most impressive entrepreneurs, because they build businesses that thrive for 25, 50 or even 100 years. Which in itself is nothing short of remarkable.
I was really excited to give this talk, because I’ve grown up in a family business. My parents, Donna and Marcus, founded an IT Staffing firm in 1989, and I joined their business in 2004. I am very grateful to work with my parents’ company, because they’ve taught me what it means to be an entrepreneur.
Create a culture of entrepreneurship
To grow through the generations requires a culture of entrepreneurship. In this market and in this economy the pressure on businesses to change and adapt is at an all time high. The strategies and value propositions that made the first generation successful won’t remain relevant forever. To maintain growth, family businesses must continually rethink and reposition their businesses for the times.
I faced these immense market forces head on when I joined my family’s business. During the 90’s and early 2000’s my parents’ company did very well, but when I joined the business in 2004 the market had changed. The tech boom was over, the dotcom bubble had burst and Ontario was coming out of a mild recession. The strategies that had worked so well for my parents were no longer applicable, and we had to change directions.
2004 was a painful and stressful year. It’s hard to see your business collapsing around you, and not knowing how to turn it around. And it’s really easy to get caught up in the past, and try to claw back to what you had. But to grow requires change. My parents taught me “it’s not about the business you’ve built, but the business you’re building.”
Their simple phrase summed it up. Growing through the generations takes more than knowing how to run the business, it requires leaders that are continually building and evolving business.
Develop next generation entrepreneurs
Developing next generation entrepreneurs is a core responsibility of the first generation. Too many founders don’t let go and hold onto control for too long. This is a mistake. If a founder holds onto control for too long they’re cursing the next generation to be caretakers, not entrepreneurs. Caretakers are great at maintaining the strategy and persevering, but they lack the essential skills of repositioning and pivoting the business. And if the next generation can’t pivot, the business won’t survive.
Every family business has an opportunity to develop next generation leaders. My advice to CAFE’s audience was to immerse their next generation leaders in the strategic direction and planning process of their businesses. Get them involved in making critical decisions, and make sure they have the skills to rethink, reposition and lead their businesses for the next 25 years.
There’s no guarantee that the strategies that are working today will be relevant tomorrow. Actually, it’s a safe bet to assume they’ll be displaced in the not too distant future. Technology, markets, globalization and lots of other trends are moving too fast. This means next generation leaders need to think like entrepreneurs, and always be building for the future.
What’s your take?
(Image credit: phill.d)