How Leaders Can Transfer Their Great Instincts to Successors

A leader's tacit knowledge can make the company more successful, but it's a challenge to understand what's behind it or how to pass it down to next-gens.

A family business leader's instinct -- often built by experience in an industry, by connections in the community, or by years of making decisions and recognizing important patterns -- often serves as an unseen guardrail that keeps the business on course and thriving.  But this tacit knowledge is so engrained in a leader that he or she doesn't even recognize it, let alone think about how to transfer it to successors. As a result, successors can sometimes make decisions that undermine the business. One popular example is Lego, a family firm that took a misguided detour to theme parks and clothing before returning its focus to brick toys.

In this interview, Meghan Lynch, CEO of Six Point Strategy, shares some ideas on how family business leaders can transfer their tacit knowledge to future leaders.  One key is for leaders to truly understand the "why" behind their decision making and share it with next gens, and then capturing the "why" into a system for the entire company. "Once you are aware of where the instinct comes from," Lynch says, "then you can replicate it."