How next-gen scions can steward family businesses amid global uncertainties
The convergence of rapid technological advances, mounting climate imperatives, shifting consumer values, and geopolitical realignments are shaking up how family businesses strategise, and the disruption imperative falls on the incoming cohort of heirs, Nupur Pavan Bang and Kavil Ramachandran write
Successors must educate the wider family on the business case for embedded sustainability—aligning priorities, capital allocation and executive incentives with long-term ecological stewardship.
Illustration: Chaitanya Dinesh Surpur
Family enterprises—which underpin economies worldwide by contributing over 70 percent of global GDP and employing nearly 60 percent of the workforce—now find themselves at the epicentre of a transformation unlike any before. The convergence of rapid technological advances, mounting climate imperatives, shifting consumer values and geopolitical realignments have all created what strategists term a BANI environment—brittle, anxious, non-linear and incomprehensible. For family firms long defined by multi-decade horizons and incremental evolution, the imperative falls on the incoming cohort of heirs to merge institutional memory with digital fluency, entrepreneurial daring and a restless drive to convert disruption into renewal.
At the heart of the disruption challenge lies the brutal acceleration of product and corporate lifecycles. A report by Innosight showed that, in 1965, the average tenure of a company in the S&P 500 exceeded 30 years; by 2016, it had fallen to 24 and is forecast to contract further to 12 years by 2027. For successor generations accustomed to inheriting legacies built over lifetimes, this shrinkage demands a marathon-sprinter’s mindset: Heirs must deploy rapid experimentation, continuous skill-building and lean decision loops to stay ahead of digital-native rivals, even as they preserve the family’s enduring values.
Bruce Lee used to say, “Empty your mind, be formless, shapeless, like water”, advocating a state of perpetual readiness, adaptability and strength. And he was not talking only about martial arts.
Future-Focussed Strategy in Action
Consider two of India’s most venerable family business groups. The Tata Group, founded over 150 years ago, has become as much a technology and services conglomerate as it is a steel manufacturer. Its digital arm, Tata Consultancy Services, invests billions in cloud computing and artificial intelligence to offset the gradual commoditisation of legacy offerings. Mahindra & Mahindra, similarly, has pivoted from tractors and utility vehicles to become a global player in electric mobility, forging partnerships with tech firms in Silicon Valley to accelerate R&D. Heirs at Tata and Mahindra did precisely what the moment demanded. Those were essential moves to catch up with rapid technology shifts and establish footholds in adjacent markets.
Today’s successors confront an entirely new mandate: They must trust their own capabilities and provide steward leadership to drive transformation within their families. By leading from behind, they shape outcomes across multiple fronts. Family governance, business strategy, entrepreneurship and wealth management are among the areas that demand fresh perspectives.
Each circle in the chart ‘Nextgen Leadership’ represents a core dimension of successor stewardship:
Strategist: As custodian of the future growth of the business, a successor has to envision the emerging environment and chart the family firm’s horizon by scanning technological trends and market shifts to align capital allocation with emerging value pools.
Professional Manager: They must facilitate the practice of professionalism as a value by benchmarking and introducing best practices, such as clear KPIs and process rigour alongside family executives, and elevate operational performance.
Serve Society: Business families have all along been connected closely with the society they live in. Nextgen must help shape philanthropy, ESG and community partnerships to reinforce the family’s and enterprise’s social relevance and long-term reputation.
Value/Heritage Custodian: As family stewards, the younger generation must lead by translating founding values and principles into actionable norms, ensuring that legacy values guide strategic and cultural choices.
Groom Nextgen: They should not wait for the seniors to groom them; rather the initiative must come from them since they are the changemakers.
Family Governance Custodian: Nextgen must take upon themselves the responsibility to enforce transparent governance in the family. They will, thus, be living by example the principles and policies of high-quality family governance.
Wealth Creator/Protector: The younger generation understands the significance of structured wealth management more than the seniors. They must help balance bold investment in growth areas with prudent risk buffers and diversification strategies to preserve intergenerational capital.
In sum, whereas the previous cohort sprinted to catch the wave of disruption, today’s successors must surf the entire storm.
Governing with Agility
Amid relentless disruption and ever-accelerating change, robust governance becomes the lynchpin of resilience. Effective governance now demands far more than static rules—it requires a learning culture that reconceives the family’s role in business. Central to this is comprehensive family education: Each member must grasp how the family’s identity and purpose interact with a swiftly shifting environment. Traditional models built on extended-family norms no longer suffice; in nuclear or geographically dispersed families, notions of fairness and togetherness must be re-negotiated. Accordingly, family policies, processes and practices should be revisited collaboratively, with formal forums to debate and codify new charters that foster harmony and mutual accountability.
Equally important is the recalibration of governance vehicles. The Family Business Board remains the enterprise’s guardian of strategy and risk, while the Family Council safeguards cohesion by enforcing the charter and resolving disputes. The Owners Council, however, assumes an expanded remit: It must incubate entrepreneurial initiatives through transparent venture-financing guidelines, clear ownership stakes and performance-linked rewards—effectively treating new ventures as corporate-venturing projects. In all bodies, respected independent directors are essential to uphold rigour, test values of trust and transparency, and temper the inevitable interplay of logic and emotion. In practice, many group structures will evolve into holding-company frameworks, with each subsidiary managed as a strategic business unit under its own performance matrix. This architecture recognises that heirs often seek both individual agency and collective purpose—and it ensures that ‘I-Me-Mine’ ambitions remain anchored within a unified family vision.
Interwoven with strategy and governance is the delicate balance between senior-generation stewardship and next-generation dynamism. The former brings deep institutional memory, extensive networks and a long-term orientation that has underpinned stability for decades. The latter embodies fluency in digital ecosystems, comfort with ambiguity and a restless pursuit of new value pools. When harnessed constructively, this generational duality can become a formidable competitive advantage. The story of Lavanya Nalli, who transformed and expanded her family’s 90-year-old silk business into a thriving ecommerce platform within five years, exemplifies how next-generation initiative can amplify a legacy brand’s reach and relevance.
However, generational tensions can turn unpleasant and acrimonious if roles and expectations are not clearly defined, underlining again the need for next-generation heirs to act as steward leaders. They cannot afford a narrow, self-righteous stance in such a dynamic world. They must recognise their future is at stake and that it is their responsibility to ensure continuity and change simultaneously. Leadership and ownership succession remain among the trickiest challenges in the life of any family business. Cyient, a multi-technology company, has successfully undergone major changes in its business portfolio during and after the transition of leadership from Mohan Reddy to his son Krishna. Cyient has been adapting proactively to disruption.
Impact and Purpose
If governance forms the backbone of resilience, then a compelling social and environmental purpose defines the family firm’s licence to operate. As regulatory regimes tighten carbon-emissions norms and stakeholders demand rigorous ESG performance, heirs can no longer defer sustainability to a later date. Too often, family enterprises underinvest in low-carbon strategies even as climate-related liabilities mount.
Successors must, therefore, educate the wider family on the business case for embedded sustainability—aligning priorities, capital allocation and executive incentives with long-term ecological stewardship. Moreover, a unifying purpose binds the family together; without it, cohesion frays and the risk of fragmentation rises.
Heightened scrutiny of corporate conduct and social impact are reshaping brand narratives. Younger consumers prize purpose-driven enterprises, and family firms enjoy an inherent credibility if they can demonstrate consistent community support and ethical probity. Next-generation leaders must, therefore, embed social and environmental impact at the strategic core—transforming purpose from a peripheral concern into a driver of resilience, reputation and sustained growth.
The Family Framework for Resilience
Underpinning all these practices is a holistic framework, integrating six mutually reinforcing pillars (see chart ‘Family Framework). This framework operates not as a static checklist but as a living operating system—one that demands rigorous discipline, continual upskilling in new domains and regular recalibration. At its heart lies the proactive agency of the next-generation, ensuring a genuinely future-focussed orientation (see chart ‘Dynamic Family Framework’).
In conclusion, the nextgen in family enterprises has the responsibility to take on the role of the nerve centre of renewal. Externally, they need to reconceive their business models through the lenses of digitalisation, sustainability and global agility. Internally, they must drive an agile governance and talent ecosystem that unites generational wisdom with new-economy dynamism. The FAMILY framework—with its emphasis on future orientation, governance agility, meritocratic culture, purpose fidelity, financial prudence and generational inclusivity—offers a practical roadmap.
Stewardship in today’s turbulent seas means more than preserving tradition: It requires embracing change as a source of renewal. As Bruce Lee taught, true mastery demands speed, fitness and an unencumbered mind ready to flow like water. Only by dancing on a globe in the rough seas—ever ready to pivot, learn and hold fast to enduring values—can family businesses convert the pressures of disruption into engines of sustained growth. In this new era, those who master the art of agile resilience will not merely survive; they will redefine what it means to endure.