Daughters in Family Enterprises: Implications and opportunities for family practitioners

Daughters raised in family businesses in the Millennial generation are increasingly seeking the opportunity to be leaders at work and within their communities. For many of them, the family business offers the career fulfillment, financial rewards, and flexibility they may not easily find in other settings. The family business also offers this generation of daughters something daughters in previous generations rarely envisioned: the chance to be true stewards of their family’s legacy. As they contribute their talents, skills, values, and experiences, and assume positions of leadership, daughters are likely to reshape the culture, traditions, practices, and policies of family businesses for years to come. This article, based on a series of interviews and podcasts with daughters and family business advisors, provides insights about the evolving role of daughters in the family enterprise and highlights the important ways that family practitioners can contribute to their success.

Family enterprise advisors play a crucial role in supporting daughters in family businesses, especially as they ascend to leadership positions. Pioneering family advisors such as Fredda Herz Brown, Jane Hilburt-Davis and Leslie Dashew, among others, are actively supporting the next generation of both men and women and encouraging young women who are eager to take on leadership roles. In many family enterprises, advisors are active and influential participants in a new constellation emerging within the network of systems that surround family businesses: the constellation of parent/owner, daughter and advisor. Managed well, with each participant raising and confronting important questions, the new constellation can help to assure that family businesses not only adapt to change, but also thrive and endure.

To highlight some of the new dynamics at play and their implications, consider a father-owner/daughter/advisor triad. There are a number of stereotypical assumptions one can make: 1) that the father expected a son would take over (the notion of primogeniture), 2) that the daughter assumed a brother would be her father’s successor and that if she pursued a career, it would be in another business or industry, and 3) that the advisor assumed that that his/her long-term relationship would continue with a son, a male relative (cousin, son-in-law, etc.), or a non-family male executive. The new shifting paradigm of daughters taking on leadership roles in the family enterprise challenges those assumptions.

Taken further, the new constellation requires each participant, including daughters, to rethink their gender stereotypes and to risk acknowledging them. A common misperception is that women are not interested in nor able to grasp the technical aspects of the business, and that they prefer to focus on relationships, marketing, and messaging. As a result, the father may be concerned that his daughter is “too soft” with employees and/or not serious about business results—until he sees the impact of his daughter’s management style on company profits. The daughter who considers herself “bad at math” may need to delve more deeply into the financial side of the business and overcome her embarrassment about asking basic questions regarding financial matters. The advisor may need to understand that the daughter poised to be CEO will remain committed to the business while also raising children, and learn to support her choices.

The structure of the constellation is itself a novel one, since historically the successors to family business have been men. In contrast, interviews with several daughters indicate that many did not expect to work in their family’s business and are likely to have pursued other careers before returning. As Kelly Backscheider, who returned to her family’s packaging business after working for several years in a global corporation, remarked in a recent interview, “It’s a world I never thought I’d go back into. It’s boxes.” This experience outside the business provides them exposure to how other businesses work, and gives them experience with very different organizational cultures. As they work for managers who are not parents or relatives, they may find mentors whose leadership styles they admire and hope to emulate. They may also receive feedback about their strengths and limiting behaviors that challenges them to learn, and supports their development as leaders. In summary, women are less likely to assume they are coming into a leadership role in the family business, yet as they pursue work in other settings and garner outside experience, they are helping shift the typically male-dominated family business paradigm.

Of course, sons often work outside the family business as well, and bring back a similar understanding of different ways to manage a business. The difference with daughters, however, is that as they take on leadership roles within the family business, by virtue of their gender they symbolize change. In the process, they disrupt long-held expectations and stereotypes about women, which can be particularly challenging when they become managers of employees who have known them all their lives. Even those daughters who grew up in a family business and never left to work somewhere else may find that employees, clients/customers, and vendors are uncomfortable when they assert their authority. On a recent podcast (www.daugthersincharge.com), Nikki Ververelli, a daughter now happily working in her father’s consulting engineering firm, had this to say about her initial transition there: “I will admit there was a joke to see how long I would last until my father fired me.” So daughters may face resistance early on, and, like women leaders in other settings, may struggle to have their voices heard, to gain credit for their ideas, and to influence business decisions.

Daughters bring with them leadership talents that can have a significant impact on the business. An oft-quoted article recently published in Forbes, describes how Julie Smolyansky took over her father’s business, Lifeway, in 2002, and increased the share price 785 percent. Many daughters, like Nikki Ververelli, are attuned to relationships and often share their expertise about marketing and communication strategies, implementing social media channels where none existed before. Daughters may also introduce ideas about flexible schedules and maternity/paternity policies that many other businesses are beginning to adopt. Jessica Lima Bollin, now a manager at Best Upon Request, her family’s concierge business, has two young children and is committed to assuring that other parents in the business have the flexibility that she enjoys. And because they are women, daughters may be able to connect with a network of other women in business, leading to new relationships with potential customers, clients, and vendors.

As key participants in the new constellation, family enterprise advisors can encourage daughters to demonstrate their skills, contribute their knowledge, and influence change. Just as parents are learning to adjust their expectations, and daughters are taking on unexpected leadership challenges, advisors can reinvent their roles and broaden their influence as well:

• Advisors to 21st century leaders are advising in a new paradigm; being educated, aware and well-versed on gender and leadership is paramount. They can learn from male and female authors, speakers, and thought leaders who emphasize the leader’s responsibility for anticipating strategic choices, for guiding adaptation to change, and for building teams with diverse members. The ideas of Ronald Heifetz on adaptive leadership, Peter Block on stewardship, Sheryl Sandberg on workplace policies that support women, and Michael Gurian and Barbara Annis on how brain differences in men and women affect workplace dynamics, are excellent examples.

• Research about women in family businesses is revealing some poignant new insights about daughters in family business, and advisors can benefit from reviewing it. In her newly revised book, The Daughter Also Rises: How Women Overcome Obstacles and Advance in the Family-Owned Business, Anne Francis suggests that fathers and daughters working together can discover mutual support, as the daughter helps her father appreciate and share his emotions, and the father learns to be a mentor and teacher. Dr. Kathy Overbeke, a researcher on gender norms in family businesses, recently observed: “It’s not that families want to undermine their daughters…they just don’t know how to include them in the system.” Advisors can help parents understand these changing dynamics. Convening joint discussions about a book or article related to developing female leaders may prompt more personal conversations and shared learning opportunities.

• The success of the new family business constellation requires an open forum for the exchange of ideas and thinking. No longer is hearing from one gender in the family enough, so having the ability to facilitate these conversations is a key skill that many advisors have and can exercise more fully. By guiding conversations, advisors can assure that this new constellation becomes a safe place for both parents and daughters to voice their hopes, concerns, and questions, to manage disagreements, and to think strategically about business opportunities and challenges.

The new constellation can be a lever for change in family businesses, with the capacity to shift patriarchal patterns, introduce new ideas, and support the development of both men and women as they adjust to a diverse and changing workplace. This constellation will become a strong and positive force as advisors envision their roles well beyond their areas of technical and professional expertise. They, too, can become leaders in the family businesses they advise by viewing themselves as professionals who develop talent-supporting daughters as leaders and successors and encouraging parents to create meaningful assignments and career challenges that will build their skills and confidence.

Family practitioners have had an enormous impact on the success of family enterprises over time. The new constellation will provide opportunities for further influence as they, too, nurture and respond to the new patterns of succession. Hopefully, the outcome will be that family enterprises, the family members who lead them and the advisors who offer their expert knowledge and counsel will continue to thrive, adapting to change through the generations to come.

Additional References:

Father Daughter Succession in Family Business: A Cross-Cultural Perspective by Daphne Halkias, Paul W. Thurman, Celina Smith and Robert S. Nason (Dec 1, 2011)

A Woman’s Place: The Crucial Roles of Women in Family Business (Family Business Publications), Ann M. Dugan, Sharon P. Krone, Kelly LeCouvie and Jennifer M. Pendergast (Dec 15, 2010)

Women in Family Business Leadership Roles: Daughters on the Stage by Mary Barrett and Ken Moores (Edward Elgar Pub Oct 2009)

Daughters in Charge: Learning to Lead in Your Family’s Business, by Amy J. Katz (e-book, November, 2013)

About the contributor:

Amy J. Katz is president of Daughters in Charge and has consulted to family businesses for fifteen years. She has a true appreciation for the special challenges and opportunities that working in a family business can provide. After Amy began facilitating a mastermind group of talented women who work in their family business, she found her passion: to help daughters and other women working in their family business lead with confidence and clarity. Amy can be reached at amy@daughtersincharge.com.