American thinking is that the Next Gen in a family business need to get outside experience before coming and working in the family firm. Should this same logic apply in Asian family businesses?

1. Is outside work experience important prior to the
Next Gen entering the family business? Asian
Perspectives
Christian Stewart
Managing Director
Family Legacy Asia (HK) Limited

2. A common scenario
here in Asia ….
• “…my son has just finished his studies ... I
think he should come and work for me now”
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3. Western Thinking
• Western thinking is that when a young adult has finished
their studies it is best to allow them to go and work
somewhere else for a couple of years, before considering
entering the family business.
• Some Western books on family business recommend being
away from the family business until you have finished
"entering the adult world“ . See Appendix A.
• One of the reasons given is that this period of being away
while you are a young adult is that it allows you to mature
and "differentiate" from your parents. See Appendix B.
• Other reasons are that it gives you a chance to
prove yourself away from the family environment; make
early mistakes away from the family environment; etc.
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4. The Question…..
Do you think the same logic should apply here in
Asia with an Asian family? Based on your own
observations and experience, do you think it
helps the next gen in an Asian family to
differentiate or mature if they can get this time
away from the family as young adults?
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5. Answer 1
Spot on …....many of the "successful" Academic
families I've seen actually adopted this Singapore
model of "learning" for their next gen.
……..
So the list goes on...the skills set
acquired outside of the family are
invaluable for the family business.
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6. Answer 2
Every NEXTGEN member does best when he or James E. Hughes Jr
she individuates and differentiates—this just like
every other human being. Every NEXTGEN Author of Family
member does best when he or she brings his or Wealth; Keeping it in
her own dream to life in the first two stages of the Family and
his her life and stewards another’s dream in the Family; The Compact
third. among Generations
Since Asian families truncate their NEXTGEN (Bloomberg Press)
members dreams and patriarchicly impose
stewarding, anything the NEXTGEN members can
do to have a few years before being stuffed into
family roles will be incredibly healthy for their
development and their families’ and the
eventual possibilities for a healthy transition.
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7. Answer 3
Answer 1: Yes, western practice tends more to Member of 4th
encourage next gen to work outside first. In generation, Singapore
really old European family businesses, they often based family owned
have official policies ‐ some even say no family business
can be in mgmt.
In Asia, there is some awareness where the
current 50 or so year old doesn't want to force
his kids immediately into the business at all. But
from my observation, perhaps partially due to
Confucian culture, I do see lots of 25‐30 year
olds going into the family biz with no or very
short (1‐2 year) outside work experience.
Follow up Question: Have you ever observed or
thought to yourself that the ones who go
straight into the family business some how suffer
for it?
Answer: Yes, thought about it. And yes, feel they
suffer from it. No chance to individuate or build
self‐esteem.
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8. Answer 4
For the next generation to work in their family business,
it is wise to let them work for someone else and join
Member of 4th
the family later when they gain their experience and generation,
earn their respect. In my case, this is the arrangement.
However, there are a few things to look at or ask Family Owned
ourselves. Is the family business well established and business
not eager to have someone from the next generation to
come in? How urgent it is? How receptive from other Hong Kong
family members that are already in the business? In
case the next G decided to join, what kind of work
position best fit them ? Are they being pay the same as
they pay for the same job who is not a family member.
The initial orientation is also important. There is always
a tendency that the staff and management will treat
the young family differently, they are after all still their
boss (in a way) which gives the young G an uneasy
feeling being treated differently (special). It creates a
pressure on them. Don't scare them. away.
I don't think the Western thinking is that much different
from the Asian thinking ….
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9. Answer 5
The same expectation and logic apply to Chinese Academic
and East Asian businesses, as far as I know. Some
fore‐sighted families would ask their friends and Hong Kong
even some professionals to help train their
second gen. apart from the reasons you
mentioned, they do so also because they worry
that the 2nd gen would either be too rebellious
and question the wisdom of their parents or
appeal to the soft spots of their parents and
dodge tough work.
Having said that, many Chinese FBs do not have
the systems set up in European Fos……. As a
result, many FBs end up giving a lot of autonomy
to the 2nd gen and either use continuous
persuasion or the help of god for bringing their
children back to the family.
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10. Answer 6
Definitely agree. The more progressive Educator &
families would subscribe to the idea.
Academic
The more conservative ones, probably, not ‐
the thinking being that the sooner they Manila,
immerse themselves in the business, the Philippines
better for the whole family. I think it's more
of the time they're concerned with ‐ why
spend time in other people's business when
you need to study your own. This is an
opinion ‐ this has not been researched or
verified. But most Filipinos with businesses,
usually follow this line of thinking. …….As for
training for the [next generation] I would
definitely recommend that they do so.
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11. Appendix A: Levinson –
Seasons of a Man’s Life
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12. Appendix B: Differentiation
versus immaturity
Source: Family Business on the Coach Manfred FR Kets de Vries, Randel S. Carlock, Elizabeth Florent-Treacy, Wiley
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13. For more information, including articles to download,
and videos to watch, please visit our web site at
www.familylegacyasia.com
Family Legacy Asia (HK) Limited
Contact: Christian Stewart
Email: cstewart@familylegacyasia.com
URL: www.familylegacyasia.com
Office: (852) 2369 3309
Fax: (852) 2369 3613
Unit A, 9th Floor
1 Chatham Road South
Tsim Sha Tsui
Kowloon, Hong Kong
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