Leading a Legacy: Addressing Talent Challenges of Family Businesses

Contributing significantly to both local and national growth, family businesses range from long-established firms to innovative start-ups, playing a vital role in their respective sectors. Despite their strengths, family businesses often struggle with specific recruitment and talent issues that can impact long-term prosperity. 

Talent considerations 

One of the most pressing challenges for family businesses is effective succession planning. Identifying and nurturing next-generation talent is crucial for ensuring continuity and preserving the family legacy. This involves creating a culture that values and develops future leaders from both within and outside of the family. A well-structured succession plan can mitigate the risks of leadership vacuums and maintain the strategic direction of the business. 

Successful family businesses often exhibit leadership traits such as resilience and adaptability, requiring leaders to effectively manage family dynamics while driving business growth. This unique blend of skills helps in navigating the complexities inherent in family-owned enterprises and ensuring harmonious operations. 

Maintaining a cohesive vision of shared values and mission across generations can be challenging but is vital for success, helping to foster a unified approach to business operations and decision-making. 

Family businesses must continuously adapt and innovate to stay competitive. This flexibility is key to their survival and growth, especially in the face of global challenges such as economic shifts and technological advancements. Embracing new technologies and innovative practices can create new opportunities and keep businesses relevant in changing markets. Encouraging a culture of innovation within the family business can also help in attracting and retaining top talent. 

Family business insight 

Mairi Mickel, visiting Professor at Strathclyde University and fourth generation family business member, with expertise in succession planning and family business coaching, commented: “Right now, future ownership planning is coming into sharp focus thanks to the changes in BPR & IHT reliefs, which will have a profound impact on a business families planning. Younger owners may push for younger leaders to represent their interests. 

“In terms of other opportunities, many NEDs and C-suite executives are looking actively for roles within mission-led organisations, rather than PLCs. This means there are more talented leaders coming into the family business space with agendas for both financial and socio-economic value add”.  

Adding the most significant leadership hurdles to overcome, Mairi outlined: “Family and non-family leaders need strong diplomatic skills to deliver on inter-generational ambitions. Other hurdles unique to family firms are when family members are promoted beyond their capabilities, causing morale problems in senior teams. Ensuring the exec team have the freedom to deliver strategy without ownership influence is key to attracting and retaining talent”. 

Tailored solution 

We understand the unique challenges that come with balancing family dynamics and business needs. Our experience with numerous family businesses allows us to adopt a partnership approach, fully appreciating the distinct pressures and dynamics involved. Our executive search service equips organisations with the necessary tools to identify, attract, and develop exceptional leadership teams. 

Similarly, our leadership development programs are designed to help organisations cultivate leadership capabilities to face future challenges and make informed talent decisions with confidence. Recognising the importance of a family business’ values and culture, we ensure the right cultural fit. Our consultants combine industry and functional expertise with geographic knowledge, to identify and attract the best talent for any business. 

Gerry Hennessey, Chair, Meallmore Ltd, commented: “Meallmore has partnered with Odgers Berndtson over many years to secure our INED’s with great success, attracting high calibre candidates. With Odgers Berndtson having access to the highest talent pool, we have always secured the best fit for our board”. 

Odgers Berndtson represents the Scottish market from offices in Edinburgh, Glasgow, and Aberdeen, offering local insights and expertise supported by a global network.