In a recent FEUSA podcast Pat Soldano was joined by Dr. Frank Luntz, communications expert and researcher, on  “How to ‘Decode Language’ to reach Gen Z (18-29)”  Why is this considered a critical issue? Because in the next 20 years, an estimated $90 trillion will change hands from Baby Boomers and Gen X to Millennials and Gen Z, and according to the latest research, the communication gap between the old guard and new guard has never been wider or more misunderstood.

The podcast focused on insights into Gen Z thoughts and feelings about the “state of our union” and the economy along with a recent study by The Smith Family Business initiative at Cornell University. Dr Luntz contributed valuable information he learned in conducting a survey and Gen Z focus group subsequently featured on CNN and CNBC—the former getting over 450,000 views.  

In this article, Linda Mack of Mack International comments on the three top concerns discovered by Soldano and Luntz from her perspective as an executive search consultant.

Concern: Lack of family communication among students preparing to be next gen family business owners. 

“It is critical to find out what motivates these young men and women and then communicate in a manner they will hear and understand. What was important for Baby Boomers is not necessarily provocative for those in their 20s. Give them a chance to be heard. Communication is a two way street. They believe in work/life balance and are seeking flexibility in how and where they work. They want to be stimulated and energized both professionally and personally, so building a culture where they want to belong is crucial. This requires some adaptability from the older generation. Current leaders of Family Offices and Family Enterprises cannot leave Gen Z education to social media or universities. Dr. Luntz’s focus group underscored the misinterpretation of capitalism vs. socialism and meritocracy vs. equality. The younger generation should be brought into family conversations at an early age. It is incumbent upon current family office leadership to teach rising generations the importance  of building a business that contributes services that empower and help others. Next gens should learn the reasons why the family business is considered the backbone of America. The family should talk about the benefits of economic freedom and how that allows for the philanthropic efforts and “healthy democracy” so important to this generation. We have seen great mutual understanding between generations result from sincere conversations where people genuinely listen, empathize and understand one another’s perspectives and work together to find common ground and objectives to serve the family.”

Concern: Worries among the young leaders about their ability to “grow revenue” and build on the business. 

“There should be an intentional grooming process for the rising generation where they find  age appropriate ways in which they can contribute to the goals and objectives of the family. It is much more impactful to self-discover through experience than to be lectured. It is a great way to build the confidence they are seeking and take pride in the family business. Working hard and observing as part of a team can be empowering with the proper mentoring. Mentors should be chosen thoughtfully, and a process  put in place to ensure young leaders acquire the necessary skills and attributes to rise to the next level of the organization. Overall, a sincere commitment by all to the successful development and preparation of next gens into governance and leadership roles will prove a wise investment for the future of the family business. ”

Concern:  Is there a succession plan in place?

“There is a seismic shift in Family Office leadership demographics coming in the next 20 years. Succession planning is key to sustaining a legacy, yet some ignore the urgency of preparing in advance. This was an issue in my own organization at Mack International. We recently hired my successor, Brian Adams, who is Gen X. He is committed to taking on an increasing leadership role in sustaining Mack International for the next 25 years. Families should be thinking the same way.  They should be actively encouraging their next gens to be involved in committees—governance, search, investment—mentoring  and supporting their development to be strong leaders in those roles. It is awkward in search committee meetings to bring a Millennial candidate for an interview and he or she is across a table representing only Baby Boomers. They don’t see anyone they can identify with for the long term. It’s a problem. When you take the time to involve the younger generations in meaningful ways, you have a natural flow of stewardship—an ongoing and smooth evolution instead of a crisis.”

Bottom line: We hear about the distrust of next gens and how that makes communication with them as future family business leaders a challenge. This is why  active listening  and building the intellectual, social and human capital of families is always time well spent.

Policy and Taxation Group is the Voice for Family Offices and Successful Individuals in Washington, DC focused exclusively on the critical tax and economic policies that impact them.

Since 1995, Policy and Taxation Group has been the leading advocacy group working to reduce and eliminate estate tax, gift tax, and generation skipping transfer tax while blocking increased income tax and capital gains taxes, the creation of a wealth tax, and other hostile tax policies that punish hardworking taxpayers and success.

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