Succession planning gaps persist as family businesses brace for leadership handoffs

Dr. Rebecca Gooch, Deloitte Private global head of insights at Deloitte Global, said succession forces family enterprises to weigh several priorities simultaneously.

“Succession is one of the defining moments for family businesses because it requires balancing legacy, governance, and future growth at once. Deloitte Private’s findings show that many family businesses understand the urgency of preparing the next-generation for leadership roles, but the transition from informal planning to structured succession strategy remains a work in progress. Businesses that invest early in leadership development, governance, and practical experience for future leaders should be better positioned to sustain continuity across generations,” Gooch said.

Next-gen steps up

Even as senior family members hold most top leadership and governance posts today, next-generation members are already carving out influence in specific functions, most notably technology (51%), philanthropy and community engagement (51%), sales and marketing (50%), and innovation and research and development (49%).

Looking ahead, respondents expect incoming leaders to prioritize technology modernization (42%), artificial intelligence (42%), new product and service development (40%), and expansion into new geographic markets (39%). At the same time, next-gen leaders themselves cited keeping pace with technological change (38%), building leadership and management skills (37%), and staying competitive (36%) as their toughest challenges.

To close the readiness gap, family businesses are leaning on structured development paths rather than informal mentorship alone. Forty-four percent of respondents said they give next-gen leaders formal roles tied to accountability and performance measurement, 43% emphasized on-the-job training and shadowing senior leaders, and 40% require next-gen family members to work outside the family business before joining it.