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Perspective:
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When is it time to let the next generation lead?

Norm Monsen

Norm Monsen is vice president of the agriculture division of Creative Business Services/CBS-Global, Green Bay, Wisconsin. He contributes this column exclusively for Cheese Market News®.

One of the privileges of spending a career around agriculture and dairy is getting to know family businesses across multiple generations.

You meet the father who started the company, then the daughter who came back after college and eventually the grandchildren who seem to know how to operate technology that the rest of us didn’t know existed.

Watching those generations work together can be inspiring.

It can also be complicated.

I have seen families do an excellent job of bringing the next generation into a business. And I have seen others struggle, not because the next generation wasn’t capable, but because the current generation never quite figured out how to let go.

That raises an important question for every family business: When is it time to let the next generation lead?

There is no birthday, anniversary or number on a financial statement that provides the answer. But there usually comes a point when teaching someone how to lead must turn into actually allowing them to lead.

Those are two very different things.

A son or daughter can work in a family business for 10 or 20 years and still never really be given the opportunity to make an important decision.

Dad still handles the biggest customers.

Mom still controls the books.

The founder still makes the final call on equipment, employees and investments.

The next generation may have a title. They may even have an office.

But are they really leading?

For the generation that built the business, stepping aside can be difficult. And understandably so.

Think about what it took to get there.

There were probably years when making payroll wasn’t easy. There were customers who left. Equipment broke at the worst possible time. Markets changed. Mistakes were made and lessons were learned the hard way.

After living through all of that, experience tells an owner: “I know what works.”

Most of the time, they probably do.

But experience can create an interesting challenge. The same knowledge that made someone a successful leader can sometimes make it difficult to allow another person to become one.

The next generation needs the benefit of experience. But they also need room to develop some of their own.
That means allowing them to make decisions.

And, yes, sometimes allowing them to make mistakes.

I grew up on a farm, and like many farm kids, I learned by doing. There were certainly times when my father could have completed a job faster or better himself. I’m sure there were moments when watching me figure something out required more patience than simply taking over.

But eventually, somebody has to hand you the keys.

That lesson applies far beyond the farm.

In a cheese plant, dairy business or any family-owned company, future leaders need opportunities to build relationships with customers, employees, suppliers, lenders and others who are important to the business.

They need to sit at the table when difficult decisions are made.

They need to understand not only what decision was made, but why.

And eventually, they need to be the person making the decision.

That transition doesn’t happen overnight.

One of the best things an owner can do is begin handing over responsibility while still being available to help.

Let the next generation lead the customer meeting.

Let them negotiate with a supplier.

Give them responsibility for a project and let them see it through.

Ask what they would do before telling them what you would do.

Then listen to the answer.

They may surprise you.

They may also choose a different path than you would have chosen.

Different does not necessarily mean wrong.

Every generation faces a business environment different from the one before it. Today’s dairy leaders are dealing with technology, labor, consumer preferences, global markets and ways of communicating that previous generations could hardly have imagined.

The next generation may see opportunities the current generation does not.

The reverse is also true. Experience provides perspective that cannot be downloaded from an app or learned in a classroom.

That is why the best transitions aren’t about one generation winning and another losing.

They are about finding the period when experience and new ideas can work together.

There is another reason to start this process early.

Someday, the current owner may not be available to answer the question.

Retirement may come as planned. Or health, family circumstances or an unexpected opportunity may accelerate the timeline.

A business is in a much stronger position when the next generation has already earned the confidence of employees, customers and suppliers before that day arrives.

And there is something in this for the older generation, too.

Stepping back doesn’t mean becoming unimportant.

Some of the most valuable people I know in dairy are those who no longer make every decision but remain available when someone needs perspective. Their role has changed from running the business to helping the next generation succeed.

There is a great deal of satisfaction in that.

After all, isn’t that one of the goals of building something worthwhile?

Not simply that it succeeds while you’re there, but that it can continue succeeding when you’re not.

So if you are fortunate enough to have a son, daughter, employee or another future leader who wants to carry your business forward, ask yourself a question: Are you preparing that person to lead someday? Or are you allowing that person to lead today?

At some point, you have to hand over the keys.

The best time to do it is while you’re still close enough to help them learn how to drive.

CMN

The views expressed by CMN’s guest columnists are their own opinions and do not necessarily reflect those of Cheese Market News®.

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