The New Science of Succession: Why Reimagination, Not Inheritance, Predicts the Future of Family Business Leadership
Posted on Tuesday 11 August 2026
This article includes contributions from Sir Michael Bibby, Chairman of Bibby Line Group and the Family Business Research Foundation, Professor Kiran Trehan, Pro Vice Chancellor of the University of York and Tariq Shah OBE, CEO of Vigo Group. All three will be speaking at the forthcoming Family Business Growth Conference on 15th September in the Guildhall, York.
When we talk about family businesses, the conversation almost always begins with succession. Who will take over? Will the next generation step in? How do we preserve the legacy?
But the more important question is, who becomes tomorrow's family business leader?
Increasingly, the answer is not simply the next generation. The family businesses most likely to thrive are those developing leaders who understand the past but are capable of creating something new.
The statistics are familiar. While most family business owners hope to pass their company to the next generation, relatively few successfully transition leadership beyond the second or third generation. Yet the real challenge is not ownership transfer. It is leadership development.
As Tariq Shah OBE, third generation leader and CEO of Vigo Group, observes: "Good succession is a process. It's planned and thought through. Everybody understands it and everybody is on board with it, rather than being something that happens at a point."
Having spent more than twenty years working in and around the family business, Shah argues that successful succession requires willingness from both generations. It is a gradual transition built on trust, preparation and shared understanding.
A recurring challenge for family firms is preparing future leaders to become something more than replicas of the founder. Shah describes three possible paths: they can fall into leadership because circumstances dictate it; they can attempt to copy the previous generation; or they can consciously develop into leaders in their own right.
"No matter how good you are at copying a previous generation, you're always going to be a second-rate version of that person."
The Missing Middle
Professor Kiran Trehan, Pro-Vice-Chancellor at the University of York and a leading researcher in family enterprise, describes a critical gap in succession planning as the 'missing middle'.
There is enormous investment in founders and significant attention given to ownership transfer, but far less focus on the years in between, when future leaders discover whether they genuinely want to lead, develop confidence, build credibility and define their own leadership identity.
Research shows that external experience is often a vital part of that journey. Nearly 70% of next-generation leaders believe experience outside the family business is essential to building credibility and driving innovation.
Shah's own experience reflects this. Alongside his role at Vigo Group, he founded a charity and later completed an MBA at Cambridge.
"One of the challenges of family business, particularly when you come straight back into it, is that you only see one way of doing things."
As Trehan's research highlights, willingness is just as important as capability. Alignment between an individual's values, ambitions and sense of purpose and those of the enterprise is one of the strongest predictors of successful succession.
Should Families Be Good Owners or Good Managers?
Sir Michael Bibby, sixth generation leader and Chairman of Bibby Line Group and the Family Business Research Foundation, believes this is one of the defining questions for modern family enterprises.
"The skills required to be good owners are often different from the skills required to be good managers."
As businesses move from founder-led organisations to sibling partnerships and later cousin consortiums, leadership increasingly becomes a question of governance, stewardship and alignment.
Bibby argues that where family members are not involved in executive roles, trust between family owners and professional leaders becomes critical. Independent non-executive directors bring diversity of thought, challenge and professional expertise for developing best practice, while family members can still play an important role as Non-Executives or in other roles within the company.
Purpose, Voice and the Future Family Leader
Trehan's research suggests that today's next generation wants something different from previous generations.
"The next generation is looking for something different. They want purpose alongside profit. They care about sustainability, innovation, flexibility and meaningful impact."
The most progressive family firms are already responding. They are creating entrepreneurial opportunities, establishing Next Generation advisory groups, investing in mentoring and giving future leaders a voice in governance well before succession occurs. This evolution also changes the role of non-family executives. Rather than being viewed as outsiders, experienced external leaders increasingly become mentors, strategic partners and stabilising influences during transition.
Innovation Across Generations
Family businesses are often perceived as risk averse, yet some of the boldest long-term investments are being made by family-owned firms. Bibby points to a challenge faced by many multi-generational businesses.
"Founder-led businesses can adapt very quickly. As ownership becomes more diversified, businesses can become more risk averse."
However, his solution is simple. "We learned from history. You have to adapt to technology and other forces of change."
Bibby Line Group's investment in a pioneering hybrid electric service vessel supporting the offshore wind sector demonstrates this willingness to innovate.
Legacy Beyond Ownership
For both Bibby and Shah, family business success extends well beyond commercial performance. Shah speaks about regeneration projects that have transformed communities over decades.
"You can literally drive down the streets and places and see the impact we've had over the last sixty years."
Bibby also highlights the role family businesses play in their enduring role for communities through long-term employment, regional leadership and philanthropy.
“Family firms head offices stay in the regions and communities where the owners had their roots, offering long-term benefits to those regions”
Ultimately, succession has never really been just about passing over control. As Trehan argues, it is about passing on confidence, values, responsible business practices, capability, relationships and purpose.
The strongest family businesses recognise that legacy is not preserved by asking the next generation to become another version of the founder. Legacy is preserved by giving them permission to become the leaders their future demands.
The future of family business will not be shaped by inheritance alone. It will be shaped by leaders who are bold enough to question the past, capable enough to learn from it and confident enough to reimagine what comes next.