Thought Leadership Articles by William Gartner October 2019

Entrepreneurship Legacy: How Narratives of the Past, Present, and Future Affect Entrepreneurship in Business Families

by William B. Gartner, Bertarelli Foundation Distinguished Professor of Family Entrepreneurship
October 2019

The stories that families tell about the history of their family and their family businesses matter. Stories that focus on how the family, over time, has solved problems and pursued opportunities enable succeeding generations to utilize the resources of their family’s businesses to engage in achieving new possibilities.  While stories that focus on the characteristics of the founder and the founder’s achievements (without clues about how these achievements were accomplished) tend to trap succeeding generations into thinking of their family businesses as monuments to the past that cannot be changed, thereby preventing successors from considering their futures in new ways.  In a soon-to-be published book chapter[1], my colleagues and I explore the stories that the next generation of business families tell by asking them to draw pictures of their family’s past, present and future.  These pictures facilitate detailed stories about their family and their family’s businesses that provide many important insights into whether successors will likely consider entrepreneurship in the future.

What enables business families to engage in entrepreneurial activities across generations? A focus on entrepreneurial legacy attempts to address often quoted aphorisms such as “shirtsleeves to shirtsleeves in three generations,” “the father buys, the son builds, the grandchild sells, and his son begs,” “rice paddies to rice paddies in three generations.” These aphorisms assume that business families are unable to be successful in their entrepreneurial endeavors beyond a generation. Yet, there is evidence that some business families are able to continue to be entrepreneurial over many generations. We suggest that the concept of “entrepreneurial legacy” provides fertile ground for understanding the ways in which business families are able (or not) to transfer entrepreneurial perspectives, skills and capabilities across generations. 

We approach entrepreneurial legacy in business families as a multi-level (that is, occurring at the individual, family and organizational levels) and a multi-temporal (that is, the simultaneous interplay of the past, present and future) situation. Insights into how and why some business families are able to act entrepreneurially over time requires being sensitive to a wide range of factors, including: the family members and their dynamics, the businesses that the family owns (and manages), as well as how the past, present and future are made sense of in order for entrepreneurial action to occur. We argue that business family members develop particular multi-temporal mindsets that enable them to navigate their family’s history, as well as their firm’s history (or firms’ histories), while making present and future-related decisions. This multi-temporal framing of strategic decisions affects each family member’s identity and mindset. The concept of entrepreneurial legacy acknowledges the tension between change and continuity affecting individual, family and organizational identities and leading to constant negotiations between the past through retrospective thinking and the “anticipated futures” through prospective thinking. 

In this book chapter, we elaborate on how and why entrepreneurial legacy can both enable and constrain entrepreneurship. To understand how the constraining effects of entrepreneurial legacy may be countered and explore the interplay between entrepreneurial legacy and entrepreneurial identities in business families, we offer the concept of emancipation, characterized as “breaking free from authority and breaking up perceived constraints.” Our argument is that, emancipation is essential for the development of entrepreneurial identities in subsequent generations after the initial “founder generation.” We characterize identity as a fluid and fundamentally relational, behavioral and symbolic self-referential description of oneself as an entrepreneur.

In any business, leaders engage with the business’s past by either reviving former values and behaviors or by developing new practices and traditions. Business family members (re)interpret over time the meaning of family, family firm and entrepreneurial legacies. Legacies are not perfectly accurate memories but rather reconstructions of the past aimed at matching present and future. Fruitful “uses of the past” occur when the past becomes a resource to build identity, culture and legitimacy in the present. Family business research has shown that historical narratives enable leaders and employees to connect past, present and future. In business families, successors are particularly confronted with the challenge of preserving family and family firm legacies while at the same time “evolving and diverging” from the past in order to bring the firm into the future and build their entrepreneurial identity.  While a business family’s past and its entrepreneurial legacy may facilitate or hinder entrepreneurial behaviors, our research sought to explore whether the stories told about each business family member’s situation were either a source of creativity, as it can be for artists, designers and creative individuals, or those that increased anxiety and paralysis.

How did we go about eliciting stories?  In this study, we worked with successors who were in a training program where the older generation was progressively transferring ownership and/or management to the next generation.  During this training process, we asked participants in the program to create three drawings to represent the past, the present and the future of their firm. After they finished the drawings, participants provided a written description of the image on the back of the paper, and afterwards engaged a short presentation to the group. We used an integrative three-stage process of narrative analysis, which examines the images and the written texts independently and then brings them together to collectively interpret. Our aim was to find parallels and differences among patterns of meaning.

What insights did we gain?  Entrepreneurial legacy occupies a central position in the narratives of the past. Drawings of the past often depict an image of the founder that conveys a sense of pride in past entrepreneurial achievements and much attention is given to the location and circumstances where the family firm was found.  In addition, the drawings often provide a family tree to show continuity from the founder to the current generation.  Stories tend to focus on either descriptions of how problems and challenges were solved across generations, or detailed representations of characteristics of the founder and a set of unchanging characteristics of the family and the business. The drawings of the present often symbolically picture the material accomplishments of the company and either emphasize a continuity with the past or changes occurring in the managerial culture and/or business model. Metaphors of success and performance suggest social and market recognition. In some drawings, much attention is given to employees depicted as extended family members. If material artifacts such as family wealth and family assets are of particular importance at this stage of the story, social artifacts such as family ethics and community involvement are particularly present in future-oriented drawings. Drawings of the future offer the most contrast. Some participants emphasize their role as protecting the past and current achievements and imagine a disembodied and unemotional future made up of development plans, growth numbers and expansion indicators. Other successors diverge substantially from the past representations. They depict themselves as entrepreneurs who identify opportunities, elaborate and defend a new vision, create new brands, enter new markets, reorganize the company and set up ambitious financial and strategic goals. For the latter, the drawings of the past are different from those of the future because they feel freer to offer more entrepreneurial images and stories of what might happen, whereas the successors who seem to be bound into continuing in a more constrained way produce similar drawings of both past and future.

What can we take away from this research?  The usefulness of the concept of entrepreneurial legacy depends on its ability to address this fundamental insight: “intergenerational successions are very much plagued by problems of passage - by an inappropriate relationship between past and future[2]."  How successors depict and talk about their family’s past, present, and future matters.  Our initial pilot study suggests that stories that focus on the process of entrepreneurship over time in the family and in the family’s businesses appear to enable succeeding generations to gain insights into how to act entrepreneurially themselves.  Entrepreneurship is a process, and, the more stories we can tell about how and why this process occurs, the more likely that succeeding generations will engage in entrepreneurship. 


[1] Radu-Lefebvre, M., Lefebvre, V., Clarke, J, and Gartner, W. B. (in press). Entrepreneurial legacy: How narratives of the past, present and future affect entrepreneurship in business families. In A. Calabro, (Ed.) A Research Agenda for Family Business. Cheltenham, UK: Edward Elgar Publishing.

[2] Miller, D., Steier, L., & Le Breton-Miller, I. 2003. Lost in time: Intergenerational succession, change, and failure in family business. Journal of business venturing, 18(4): 513-531.