CEO Succession and Gender: The New Generation of Female Entrepreneurs in Family Enterprises
More and more women are succeeding their renowned and formative entrepreneurial fathers as CEOs in the family business. Not only is there a change in generation, but also in gender. In a recent interview with the magazine HANIX, Prof. Dr. Miriam Bird talked about these changes as well as the challenges and opportunities for the new generation of female entrepreneurs.
The fact that women are being considered as company successors is becoming more and more common, although not always planned, but often by chance. Different factors influence the fact that daughters are not always the first choice in business succession: “This is because corporate patriarchs often have a negative attitude towards their own daughters, are conservative and do not consider them in the company succession,” explains Prof. Miriam Bird. However, sons are also increasingly opting for alternative career paths and the shortlist of potential successors interested in taking over the family business is becoming shorter. Prof. Bird refers to Karl Lagerfeld as an example, who wanted to pursue his passion and became a fashion designer instead of taking over his parents’ milk-producing business. “Many want to fulfill their own goals, which doesn’t always necessarily mean wanting to take over the family business.”
Once the succession has been clarified, there are further hurdles that make it difficult for women to gain a foothold as CEO in the family business: “On the company side, it depends very much on the industry. There are many industries, especially technology-based or logistics industries, that are still very much male-dominated. These industries are not adequately prepared for women in leadership positions, which is why we first need a mindshift, so that stereotypes don’t continue to prevail,” knows Miriam Bird. What plays an important part in this is that women need to be encouraged early on to pursue an education in the STEM fields. This also requires the support of society to create acceptance and give women the self-confidence they need to assert themselves – even in traditionally “male” fields.
In this context, it is quite promising when female successors do not study exactly what might seem like the perfect match with the family’s business. “If you studied something different, then you learned to look at things more comprehensively which helps in developing new ideas,” says Miriam Bird. Innovation, in other words, enabled by new approaches. However, certain entrenched ways of thinking can be an obstacle. “You have to distinguish between family businesses that are attached to their own values, i.e. what the family stands for, and those that cling to the tried and true at all costs. Those are two different things. Any company that tries exclusively to maintain the status quo will sooner or later cease to exist. Businesses need to innovate on a regular basis in order to persist. Family businesses know this.” From her research, Prof. Bird also knows that it is often the founding father, who holds on to the status quo and sets patriarchal structures. Often, founders of family businesses exploit their position of power and prevent innovation, even after they have handed the business over to their successor. So are women better leaders? “There are two perspectives on this. There is a faction that clearly says that women lead differently, are much more empathetic, have different communication structures. Empathy is an important leadership quality, because if I have empathy, I can better lead my employees. On the other hand, there is the faction that says that we as the general public implicitly project certain attributes onto women because of our stereotypical thinking. There is sufficient research here that has examined male and female leadership behavior and found no differences. Only marginally different behavior can be found in the results. In reality, it is not always the case that the leadership style of women differs from that of men. But it is also true that leadership styles are not one hundred percent the same,” explains Prof. Miriam Bird.
Read the complete interview (in German) here: https://www.hanix-magazin.de/Ausgabe_Februar_Maerz_2021/#48
Prof. Dr. Miriam Bird holds the professorship for Entrepreneurship and Family Enterprise at the TUM School of Management, TUM Campus Heilbronn. As director, she is also leading the Global Center for Family Enterprise (GCFE). In her research, Miriam Bird focuses on topics such as company succession, innovation, and strategy in family firms.
Related News in this category
Technical University of Munich
TUM School of Management