Management Today comments:
Clogs to clogs in three generations. That was always how wise northerners regarded the likely rise and fall of a business dynasty.
But for the likes of Lord Hanson, who recently enjoyed his 69th birthday, 67-year-old Bob Maxwell, 66-year-old Lord Weinstock, not to mention 73-year-old Tiny Rowland, the question of succession is looming ever larger in their business calculations. Some have heirs pencilled in as successors or learning the trade with that in mind. But, as yet, few of the second generation have shown the sort of devastating business acumen or drive that propelled their fathers to the top.
No doubt some of the sons will be able to carry on the dynasty. It can be done. Look at the way that the Sainsbury supermarket chain has flourished under third generation control, while Rocco Forte is trying to be a real chip off the old block at Trusthouse Forte.
Inevitably, however, if not the second then the third or fourth generation will simply opt for the turf or tennis court rather than hard graft in the boardroom. Where are the succeeding generations of the 19th century industrialists such as the Guest family (better known as Guest Keen and Nettlefold or GKN)? Look no further than Ivor Fox-Strangways Guest, third Viscount Wimborne, a land-owning tax exile. There are exceptions. Dominic Cadbury, a fourth generation member of the chocolate family, has proved to be a brilliant chief executive, largely responsible for the revival of the chocolate group.
There is something peculiarly British about this desire by succeeding generations to desert "trade" for the life of a country gentleman. The first act of many of those 1980s entrepreneurs, who managed to sell their businesses before last year's bloodbath, was always to buy an estate in Scotland and play out the role of country squire.
This depressing phenomenon reflects the deep-rooted anti-industrial spirit still endemic at the top of our society. With this sort of view, which regards a business ultimately as little more than a commodity to be traded on rather than to be lovingly nourished and nurtured as a community (on the German or Japanese model), the idea of long-term growth, investment, research and development will be replaced by the notion of the fast buck.
Of course, it could be argued that the dynamics of capitalism require the constant renewal and refreshing of entrepreneurial talent, that as one company withers away, thrusting new talent takes over elsewhere to replace it. Unfortunately, if you consider the way that the '80s stars (the Saatchis, Martin Sorrell, Michael Green, John Gunn and the like) are being shot out of the sky, it seems that Britain is in dire shortage of this commodity at present as well. Where is the next Hanson or Weinstock?
It is something that should even concern the City as well as industry. Much of the '80s bull market was underpinned by the takeover activities and the subsequent profits growths racked up by Hanson, Maxwell et al. If there is no one to replace them, who will fuel the next bull market, if or when it eventually comes?