Dynastic wealth is back. Many enterprises created in the recent global leap forward remain family-owned, and their continuance depends on the next generation being capable of sustaining their growth.
Families need clear strategies for preparing their children to take control of assets. There are some experts who provide career mentorship and life-skills training, and private banks have developed short ‘next generation’ courses. However, what should be a developed profession is still in its infancy.
Such families need steering around four main pitfalls:
**1. Basic life experience and life skills are assumed**
It is vital to differentiate between experience of work and ‘work experience’. The way to learn how to motivate employees is to experience being at the bottom of an organisation. Perhaps a summer spent stacking shelves or washing dishes should precede a summer job shadowing executives.
The place to learn to sell and cope with rejection is not in a large marketing department but cold calling door-to-door or working in a call centre.
Work experience in a small business or charity may lack the CV ‘wow’ factor of an internship in a bank, but in a matter of weeks a keen intern will have learnt the workings of the enterprise and become an important contributor.
Do not assume basic workplace skills — networking, dressing appropriately, punctuality, CV and covering-letter writing — will be taught at home, school or university. A career mentor can help with these fundamentals.
**2. University is perceived as training, not education**
Academic education should be extended for academic students; training can come later. A serious misconception is that a degree in business, accounting or economics is a prerequisite for a career in commerce.
It is often far better to study an academic subject. Even the most esoteric courses at good universities develop the cognitive skills required for business: structuring, modelling, analysis and lateral thinking.
For students who are not academic, vocational courses or apprenticeships may be preferable to business degrees at lower-ranking universities. MBA programmes can be valuable, but students need substantial full-time work experience to gain real benefit from them.
**3. Professional training outside the family business is underrated**
Some of the less fashionable graduate training programmes invest far more in training than lower-ranked university business degrees. Accountancy qualifications remain exceptionally robust foundations. A commission in the British Army develops leadership, communication and organisational skills that are second to none.
For ‘next gens’ not suited to competitive graduate schemes, a career mentor can provide guidance — directing them towards small enterprises or helping them set up independently, where mistakes can be made without damaging family assets.
**4. ‘Next gens’ are discouraged from playing to their strengths**
A prerequisite for dynastic stability is discipline and work ethic. Too many next gens are pushed towards finance-focused courses for which they lack aptitude or motivation, while possessing intrinsic motivation and creative skills better suited elsewhere.
Students who follow their talents develop lifelong qualities of hard work, perseverance and ingenuity. They may succeed in vocational careers, but will also gain maturity and creative insight, commanding the respect required to be stewards — if not CEOs — of family assets.
Perhaps the most useful advice in the daunting task of next-generation planning is this: don’t rush, and don’t give too much too soon.
As a basic tenet, remember Warren Buffett’s advice — give your children enough to do anything, but not enough to do nothing.
