Family enterprises form the majority of businesses large and small in every country in the world. At the same time, few are able to sustain themselves with the same level of wealth and success even into their second generation and sustaining shared family wealth after the third generation is nearly improbable.
Overcoming these challenges is the subject of the book, Borrowed from Your Grandchildren: The Evolution of 100-Year Family Enterprises (Wiley, Feb. 26, 2020), by Dennis Jaffe, a leading architect of family enterprise consulting. As each generation of a family enterprise becomes larger and more complex, the book describes how the family must evolve through internal and external challenges to remain cohesive.
Borrowed from Your Grandchildren presents the findings of a multiyear project in which researchers interviewed more than 100 families around the globe to understand the evolution of family enterprises that have succeeded for 100 years or more. Particularly, Jaffe shares findings in an engaging narrative that point to elements of families’ experiences and learnings that allowed them to survive for the long term.
In a time when there is much concern about the concentration of wealth in the hands of ‘the 1%,’ Jaffe’s study is an important addition to the dialogue. It shows how, in many successful family enterprises, business values and culture aren’t focused solely on generation of wealth, but on using resources responsibly.
In Borrowed from Your Grandchildren, Jaffe shares qualities and practices of what he calls ‘generative families,’ and addresses:
What specific qualities sustain a family enterprise for successive generations
How shared values and a long-term perspective inform successful family enterprises
How business families develop social responsibility and resilience across generations
How family businesses avoid the three-generation “curse” and improve chances for longevity
How older generations effectively groom younger generations to assume responsibilities — and how younger generations often branch into new directions
How forces of digitalization, globalization and rapid change make today’s environment for families fundamentally different
What important differences exist between family and non-family businesses?
What family dynasties — from America’s Rockefellers to Sweden’s Wallenbergs to Korea and Japan’s Kongo Gumi — serve as models for today’s families businesses?
Following the evolution of multigenerational family businesses, Jaffe uncovers qualities of the first-generation entrepreneur, the second generation that grows and professionalizes the business, and the third or fourth generations when the increasing numbers of family members have to decide the nature of their engagement in the business.
The author’s many examples, along with tools and activities, will prove instructive to families forming or maintaining family enterprises, along with lawyers, accountants, bankers, coaches, consultants, board members and other trusted advisors who offer resources to families to keep them on course.
“As we enter a new century of global business, characterized by uncertainty, unpredictability, high risk, and dramatic technological innovation, the public company managerial model may no longer be the most adaptive form of business. All over the world, business is discovering advantages of long-term family ownership and control.”
—Dennis Jaffe
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