If a family business employs two or more members of a family that are equally suited to leading the company, there are other, possibly more satisfactory, options than leadership rotation for capitalizing on their talents. Like rotation, however, both are tricky configurations and are dependent on excellent communication between the two leaders and a history of working well together.
One solution, co-presidency, is gaining in popularity among family business firms. In a 1997 family business survey done by Arthur Andersen LLP and Mass Mutual, almost 10 percent of family firms surveyed said they had two co-CEOs at the helm. In a co-presidency, all decisions are made through consensus. A second option is for one of the talented leaders to head another company. Often the second leader will start a company that complements the original business, using some of the original business's cash resources. Then each of the leaders works in conjunction, but not in unison, with each other.
Should you be forced to choose one of these three options, maybe because one of the talented leaders needs or wants a few years hiatus from the position or the business, or because you have two equally talented leaders, keep the following in mind: Agreement on how it will work must be clear, cordial and put in writing from the very start.
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Family Business Advisory Partners Inc., (216) 328-8529