What if you were preordained to become the CEO of a company on the day you were born?
Surely, your path to the “big job” would look much different than someone who became CEO of a company based entirely on merit. In a family business, this is often exactly what happens. Of course, that doesn’t mean a future family business CEO is set up for failure. But while each of these theoretical CEOs may very well end up being great at their jobs, there are obviously marked differences in how they got there — differences that can come with some ramifications, like a lack of “executive maturity.”
The concept of executive maturity — demonstrating sound actions, behaviors, and judgements—most often refers to “soft skills” that are increasingly important in successful leaders. In a corporate setting, these behaviors are almost guaranteed because of the inherent standards that set expectations for how one should behave in a corporate setting.
But family or entrepreneur-led businesses often have no guardrails around executive behavior. These companies were started by entrepreneurs who did things their way, and it worked. But as these companies become more established, a lack of executive maturity in leadership can cause big problems for the business. In my work as a family business consultant, I have witnessed many cases where the leader of family businesses and their potential successors often do not demonstrate the appropriate amount of executive maturity. And while you can have a successful company with a relaxed, decidedly “un-corporate” vibe, family businesses must be careful to not let a lack of executive maturity damage the business.
There’s just one problem — when the leader or successor of a family business lacks executive maturity, who’s going to tell them?
Executives who lack maturity often also lack the ability to see that how they are acting is having a negative effect on the company, its employees and its customers. It can be like a gas leak — no one notices until it’s too late.
For that reason, all family or closely held businesses should get ahead of the situation and set expectations around executive behavior. This requires a long, sometimes uncomfortable look in the mirror, but it’s necessary for the business to survive and thrive when things go south. The responsibility falls on the family business leadership to set these guardrails, but it’s often a good idea to bring in an outside consultant to act as a mediator and guide to help leadership see clearly and honestly what must be done. And like many behavioral adjustments, the process takes time.
Setting behavioral standards
Improving executive maturity starts by setting a standard — what are the expected behaviors? These must be made clear for each situation. For instance, how are executives expected to act around employees? With clients? What is OK to express in public and what is not? Whether you’re working with an outside consultant or the family leadership team, the first order of business is to agree upon this set of behaviors.
But that’s just the start. Defining acceptable behaviors is much easier than learning to display those behaviors. It takes time — and practice. Think of it like going on a diet — you know what behaviors will help you lose weight, but actually doing it is much harder. That’s why you hear health professionals talk about “lifestyle changes.” It’s the same for executive maturity. You must learn to make those behavioral changes that will last.
Most family business executives have never had any formal training, and it often shows. Like everything else in life, practice makes perfect. Setting up formal, ongoing executive training will help current and future family business leaders develop and maintain executive maturity. And remember, training and behavior change are a life-long process, not a destination. It requires consistent maintenance.
Investing in the future
The best way to ensure executive maturity over the long term for a family business is to invest early in the next generation. This will both ensure that the business successor enters the job with fully formed executive maturity, and perhaps more importantly, will set the example for the following generations to follow, ensuring a solid approach to leadership well into the future — and cementing the legacy of the family business long after the current leadership is out of the picture.