The Battle Between Family & Legacy Employees: Why It's Happening
By Kyle Danner
Determining how legacy employees fit into the leadership mix can be a difficult issue for a family business transitioning from one generation to the next, particularly from the founding to the second generation.
The term “legacy employees” applies to staff members who have been with the company from its founding or for 10+ years. They are common in a family business and are appreciated for their loyalty to the firm. In essence, they become like family members, and often owners treat them as such.
It is understandable that the relationships are close. From the personal side, both parties saw their respective families grow up together. They experienced major life events together such as births, graduations, weddings and funerals.
On the professional side, legacy employees were there from the start of the business. They may have worked long hours because they believed in the owner’s vision. They may have worked harder because they enjoyed more autonomy and trust. They may have received greater financial rewards due to their loyalty and long tenure.
So where do problems arise? What challenges to employers with legacy employees and employees who are a part of the family face? And what can you do about it?
The Problem with Legacy Employees in the Family Business
The presence of legacy employees is not an issue in and of itself.
Issues tend to arise when the next generation joins the business and it’s communicated they will be the future leaders, especially if they're new to the business. This is where the challenge of divided loyalties among all parties comes into play.
As the owner of your family business, you may feel divided loyalties between your children and your trusted employees who have been with you since the beginning. You probably don't want to rock the boat; you want everyone to stay happy. For this reason, you might avoid difficult conversations with your employees and the next generation. But this often makes the problems worse.
Let me explain.
Legacy employees may feel resentment toward newcomers and the change they present. Because of their loyalty and years of service, they likely expect to have a prominent role in the future of the business. The next generation threatens that.
On top of that, they might still see the next generation as the sweet little girl or rebellious teenaged boy they once knew. They're still kids in their mind. And, for that reason, the legacy employees may feel like the NextGen isn't competent to take over the business.
And the Next Generation is facing struggles of their own. They may feel frustrated with legacy employees' "This is the way we've always done it" attitude. They may resent perceived preferential treatment you give them on part of legacy employees, and vice versa.
When all of these problems are left unaddressed, they don't typically go away on their own. Instead, they often fester, leading to a potential blowup. As the business owner, you're in a tough spot. You must help resolve this tension so you can keep both parties happy and engaged with the business.
How to Address the Divided Loyalties Without Losing Employees
As with all challenges, attitude and approach can determine whether change is successfully implemented. With the right strategies, you can start a productive conversation about the challenges your new employees and legacy employees are facing. It won't be easy, but it's the first step toward getting everyone on the same page.
Ready to get started?
Click the link below and discover 5 techniques you can use to address the emotions legacy employees and the next generation are facing.
If you aren't sure that the kids are ready to take over the family business, you aren't alone. One of the most difficult challenges family business owners face is determining whether the next generation should lead the business. You can download a free chapter of my book, "Is There An Elephant In Your Family Business?", for resources you can use to find out if the next generation is a good fit for your family business.