Guest contributor: Tarek el Sehity
Tarek el Sehity is a researcher and lecturer at Sigmund Freud University in Vienna.
“For things to remain the same, everything must change.”
Giuseppe Tomasi di Lampedusa, The Leopard
This enduring wisdom captures a fundamental truth for business families that have withstood the test of time: preserving the values that truly matter requires continuous evolution in how they are embodied.
This notion of change as part of a larger strategic adaptation emerged as a central theme of our latest research on the transmission of family values in multigenerational family-owned firms, which builds on a previous study on shared family purpose.
Shared values as common threads
As part of our study, we conducted 23 in-depth interviews with eight Austrian business families that represented two to six generations of leadership. Of particular interest was how shared values manifest in authentic intergenerational interactions within the family enterprise.
As our study revealed, enduring foundational values with cross-generational impact are not passed down like family heirlooms. Rather, values endure only when each generation is able to reformulate them in a co-creative process through dialogue, friction and unifying objectives within the firm.
We use the term “family value composites” for these outcomes to reflect their evolving nature: configurations of shared meaning that are created and cultivated across generations.
The language of legacy
In the language of legacy, the word “transmission” implies fixed content that moves in one direction from seniors to juniors. This perspective obscures two realities of family business.
First, the leaders of family-owned firms must consider the agency of the next generation—children, adolescents and young adults—who are not content to passively receive and follow set-in-stone values. They question, reinterpret and sometimes invert them.
The family enterprise as amplifier is also key. Business families live their values out loud in their hiring practices, governance, philanthropy and strategy. They bring their family values to life in visible and consequential ways every day in the family business.
Changing family values, a sign of the times
Our study revealed that prosocial and relational values such as fairness, sustainability and trust were often sustained across generations, but not by replication.
Next-generation members integrated them because they had seen them modeled and were able to appreciate and effectively apply them in today’s context.
Younger generations also might decide to reevaluate and hierarchically invert the current family values. For example, one of the subjects in our study included an heir to a meat processing plant who rejected animal slaughter on ethical grounds. His ethical stance inspired the launch of a plant-based product line, in turn transforming the business while sustaining its entrepreneurial vision.
In another case, third-generation members sought to break away from the founding patriarch’s opaque and controlling management style by institutionalizing the values of open feedback and transparency into the firm’s corporate culture. What began as resistance matured into a new, shared leadership ethos.
Values in evolution
As these real-life examples show, companies have the power of successfully transforming their strategy to reflect the family’s evolving values.
The outcomes of these value inversions are not opposites so much as dialectical partners: inversions at one transition often set the stage for renewed congruence at the next.
In an upcoming post, we’ll delve into the pillars of this co-creative process in multigenerational family firms, as well as key insights to put them into practice.
Homepage image: Floriane Vita on Unsplash