The Founder's Dilemma is a well-known case taught at Harvard Business School.
On paper, it is about succession.
In reality, it is about identity, fear, and unfinished separation.

I was recently called by a family facing a situation that mirrored the case almost perfectly.

A founder had formally handed over the title of President and CEO to his son.
The announcement had been made.
The org chart updated.
Emails sent.

On the surface, succession had happened.

But in practice, nothing had changed.

The father continued to operate exactly as before. He made decisions. He called clients. He redirected teams. He “helped” when things slowed down. He stepped in when results were not immediate. Everyone knew who still held the real authority.

The son, meanwhile, carried full responsibility without real power. He was accountable for outcomes he could not fully influence. He was expected to lead, but not allowed to fail. To decide, but not to truly decide.

The organization was stuck in a classic shadow-founder dynamic.

What made this situation especially delicate was that no one was acting in bad faith. The father genuinely believed he was protecting the business. The son wanted to honor his father while proving himself. The team was simply trying to survive the ambiguity.

This was not a governance problem first.
It was a human one.

So I did not start with structures, boards, or role descriptions.
I started with the invisible.

Step one: naming what everyone felt but no one said

In separate conversations with father and son, I asked a simple question:

“Who do people experience as the final authority right now?”

There was a pause.

Both answered honestly. And both gave the same answer.

That moment mattered. Not because it solved anything, but because it made the invisible visible. Until then, the tension lived in glances, hesitations, and side conversations. Naming it shifted it from the emotional underground into the room.

Only once the pattern was acknowledged could we work with it.

Step two: separating title, authority, and identity

The founder was not struggling to let go of a role.
He was struggling to let go of who he had been for decades.

So we slowed the conversation down and disentangled three things that had become fused:

• The title he had handed over
• The authority he was still exercising
• The identity he feared losing

He had stepped down on paper, but no one had helped him step into a next identity that felt meaningful. Without that, continuing to operate “as before” was not control. It was self-preservation.

We worked explicitly on what his new contribution would be and, just as importantly, what it would no longer be.

Step three: restoring real authority to the successor

With the son, the work was different.

He did not need more confidence.
He needed legitimate space.

Together, we defined a small number of non-negotiable decision domains that were fully his. Not symbolic ones. Real ones. Areas where he could succeed or fail without correction, rescue, or silent overrides.

We also prepared him for something crucial: discomfort.

Real authority feels lonely at first. Especially when you have been protected by proximity to a founder. Stepping into ownership meant tolerating mistakes, tension, and moments where the old safety net would no longer appear.

Step four: making the transition visible to the system

Nothing changes in a family enterprise until the system experiences it.

So the final step was not another private conversation.
It was a public one.

The founder explicitly communicated to the leadership team which decisions were no longer his. He named where he would step back. And he held that line even when it was uncomfortable.

The son, in turn, stepped forward visibly. Not with speeches or posture, but with decisions. Some landed well. Some didn’t. And that was precisely the point.

What resolved the situation

What resolved the situation was not a perfect plan.

It was alignment between authority, accountability, and identity.

The founder did not disappear. He transformed.
The son did not “take over.” He stepped into ownership.
And the organization finally knew who was in charge, not because it was written somewhere, but because it was lived.

This is the deeper lesson behind The Founder’s Dilemma:
Succession fails not when power is transferred too slowly, but when it is transferred without emotional separation.

Titles can change in a day.
Ownership takes longer.

And until that happens, organizations remain loyal to the past, even while claiming to move into the future.

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Photo by Mitchell Soeharsono on Unsplash