Legacy is an intangible, invisible pressure that impacts the choice making of the following technology in a household enterprise. Psychologists name the motivation to construct legacy generativity, and it stems from the priority for the welfare, well-being, and safety of future generations. Creating and sustaining legacy is a means for relations to perpetuate the household identification and goal. However are legacies at all times optimistic? The paradox is that legacy has been proven to result in each optimistic and damaging outcomes for organizations and people. Legacy is an asset to a household enterprise when it serves as a supply of identification, inspiration, and course. The draw back is that legacy may also be a legal responsibility — that is the inherent paradox of legacy. Corporations can develop into so entrenched in custom and “the best way issues have at all times been” that they constrain innovation, change, and organizational agility. The problem for household enterprise leaders is to handle this legacy paradox.
Jon M. Huntsman, founding father of the Huntsman Company, passed away in 2018. Once I requested his son, David Huntsman, in regards to the lasting affect of his father on his position as president of the Huntsman Basis, he mentioned, “Having grown up in a household enterprise, my father’s affect continues to be ever-present in my life — whether or not I acknowledge that consciously or not. I do know precisely what he would say or do in nearly each enterprise scenario, as a result of I watched it firsthand for years. His impression, though he’s not right here, nonetheless impacts even the little selections I make all through the day — issues I do or select to not. A part of him will at all times be with me, not simply in enterprise however in all facets of life.”
Legacy is an intangible, invisible pressure that impacts the choice making of the following technology within the enterprise, and in life basically. Legacy has additionally been known as the “connective tissue” that hyperlinks generations in a household enterprise. Jon Huntsman’s values, beliefs, and behaviors stay on within the lives of his descendants lengthy after his passing. Legacy begins when the values, norms, information, and beliefs of earlier generations are entrenched within the present technology. As soon as embedded, next-generation leaders develop into the “keepers” of the household/enterprise legacy. Till legacy is adopted, the issues that make up somebody’s legacy are merely traits of the earlier technology. However as soon as rooted, legacy turns into a conviction that guides the next behaviors of the following technology.
Research has proven that enterprise founders, senior generations, and fogeys are motivated to construct and maintain legacies primarily based upon the ethical and non secular beliefs, information, norms, and values that labored for them, and that they might have obtained from earlier generations themselves. Psychologists name the motivation to construct legacy generativity, and it stems from the priority for the welfare, well-being, and safety of future generations. This desire has been found to exist more in family firms than non-family firms due to an elevated feeling of ethical obligation to previous and future generations. Creating and sustaining legacy is a means for relations to perpetuate the household identification and goal.
There are a number of prescriptions within the literature explaining the best way to construct a legacy in a household enterprise. For instance, in a recent Forbes article, Stephanie Burns argues that constructing a legacy requires being the very best at what you do, including new causes to the prevailing legacy, honoring the prevailing legacy, and carrying on cultural heritage. Tales, diaries, pictures, and household property akin to land, factories, and homes, in addition to household symbols akin to logos and rituals, are necessary automobiles that talk legacy. These mechanisms can characterize and talk the deeply held beliefs, norms, and values that make up the legacy of the household enterprise. They can also play important roles in developing a lasting legacy for the next generation.
However are legacies at all times optimistic? The paradox is that legacy has been proven to result in each optimistic and damaging outcomes for organizations and people. Legacy is an asset to a household enterprise when it serves as a supply of identification, inspiration, and course. Jay Barney’s research means that it could be the one actual supply of sustainable aggressive benefit for a household enterprise. Legacy is uncommon, imperfectly imitable, invaluable, and sustained throughout the firm — rivals can copy merchandise and processes, but it surely’s unimaginable to repeat an organization’s legacy.
For David Huntsman, expertise together with his father can’t be copied and is, for him, uncommon and invaluable. He has realized from the expertise that solely he and his agency have had, and consequently, his father’s values and knowledge stay inside him and his agency. His father’s legacy has at all times been good for the corporate and the household, and sustaining that deeply-held legacy is rational. To do something opposite to that legacy could be a violation of the values and norms that outline their household and their household enterprise. Shifting away from legacy runs the danger of shedding the aggressive benefit that the household enterprise has at all times loved.
The draw back is that legacy may also be a legal responsibility — that is the inherent paradox of legacy. Corporations can develop into so entrenched in custom and “the best way issues have at all times been” that they constrain innovation, change, and organizational agility. Relations could really feel trapped by the previous and will subsequently face an ethical dilemma once they’re pushed to maintain the legacy and brush apart a want to construct their very own imaginative and prescient and technique, which could in the end be essential to maintain and develop the corporate. Therein lies the paradox: feeling the necessity to stay the embedded values, beliefs, behaviors, and information of the previous, which could battle with a want to innovate and transfer away from the legacy that has at all times outlined them. Robust adherence to legacy can create organizational inertia that makes it tough for leaders to switch the agency’s technique, model, and routines when needed.
The problem for household enterprise leaders is to handle the legacy paradox. It’s a battle between the top and the guts. The pinnacle may decide {that a} change is required primarily based upon rational logic and evaluation of the scenario. The center may need an emotional attachment to the previous. The result’s a battle between the target situational evaluation and subjective intestine beliefs. Ought to the chief keep true to the household legacy and heritage that has at all times labored prior to now, or ought to the chief redefine the legacy, the household identification, and the agency that could be needed for the long run? It is among the most tough, gut-wrenching selections that every one household enterprise leaders should ultimately make. No household enterprise chief desires the excellence of destroying the household enterprise and all the pieces that the household represents. It’s the major motive why we see household enterprise leaders justifying “socio-emotional” efficiency akin to household unity and concord over doubtlessly greater monetary efficiency in a household enterprise.
Ultimately, it’s a matter of making and molding a legacy that may evolve and develop into part of the household enterprise tradition. A essential a part of a profitable household enterprise legacy is being the very best at what the enterprise does, and having leaders who’re persistently contributing the competencies and methods wanted to maintain it that means. A profitable legacy can’t be so rooted prior to now that modifications within the group can’t be successfully addressed. The keepers of the legacy should handle the tough activity of managing stability and change. The chief should decide which values, norms, and beliefs are timeless and legitimate no matter circumstances — for they’re the core of the legacy that should outline the identification of the household and the enterprise going ahead. Beliefs, behaviors, and information which can be not core restrain needed change and should be challenged for the enterprise and the household to outlive and thrive. On this means, the enterprise can retain its core identification and maintain its aggressive benefit.
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