Hiring a non-family executive in a family business is a big step. It can bring in fresh ideas, strengthen leadership, and help secure the future. But when it goes wrong, it can cause tension, misalignment, and even disrupt the business. So, what makes these appointments fail, and how can you lay the groundwork for success before the search begins?
Why These Appointments Can Go Wrong
A common mistake is diving into recruitment without proper preparation. It’s not just about finding someone with the right experience on paper. It’s about finding someone who understands the unique dynamics of a family business and fits into its culture. Skipping this step often leads to clashing expectations and unnecessary frustration.
Owner interference is another big challenge. Family businesses thrive on the passion and vision of their leaders, but this can become problematic if there’s no clear structure.
Without defined roles and boundaries, even the best executive can end up feeling powerless or frustrated.
And then there’s the issue of unclear goals. Is the new hire supposed to professionalise the business? Prepare it for sale? Drive growth in a specific area? Prepare the next generation for leadership? Without a clear ‘why’ behind the hire, it’s tough to find the right ‘who.’
Additionally, family businesses often underestimate the emotional element of bringing in an outsider. For many families, the business is deeply personal—a reflection of their values, identity, and legacy. An executive who doesn’t acknowledge or respect this emotional connection may struggle to build trust, even if they excel in their technical abilities.
The Power of Preparation
Getting ready before you start looking for candidates is crucial. Here’s what you need to do:
Be crystal clear about the role. What does success look like? How will the new executive’s role interact with those of family members?
Set up strong governance. Who will the executive report to? What decisions will they have the authority to make? Clear governance helps everyone know where they stand and reduces potential conflicts.
Get aligned on goals. The family needs to be on the same page about the hire’s purpose. Mixed messages or hidden agendas will derail even the best candidate.
Think about cultural fit. Family businesses often have unique cultures that make them special. You need someone who doesn’t just respect this culture but can thrive within it.
Factor in succession planning. If this hire is part of a bigger strategy, like preparing for succession or a sale, make sure that’s built into the process and communicated clearly to candidates.
Start planning integration early. Think about how you’re going to integrate the new hire into the business. Familiarise them with the company’s heritage, values, governance structure, and key stakeholders to ensure a smooth transition.
Involve the family in the process. Bringing in a non-family executive shouldn’t feel like a replacement for the family—it should feel like an addition. Involving key family members in the hiring process can help ensure alignment and buy-in from the start.
Consider external support. Family businesses often benefit from working with advisors who understand their unique challenges. An experienced advisor can help mediate discussions, align expectations, and identify candidates who are both technically qualified and culturally compatible.
Setting Yourself Up for Success
At TWYD, we’ve seen first-hand how vital preparation is. When families take the time to clarify their goals, establish boundaries, and define success, they’re far more likely to find someone who’s the right fit. It’s not just about avoiding the cost and disruption of a bad hire—it’s about building a future that works for everyone.
Preparation doesn’t stop at the hire. Once the executive is on board, ongoing communication, feedback, and support are key. Regular check-ins with both the executive and the family can help address any issues early and build a strong, trusting relationship.
Bringing a non-family executive into a family business isn’t always easy, but it can be a game-changer. With the right approach, you’re not just hiring an employee; you’re setting the stage for a brighter future.
About the Author
David Twiddle is Managing Partner of TWYD & CO. He advises business families on the appointment of non-family executives and on the complex and sensitive people challenges often encountered in family enterprises.