Succession: General

Many of us are aware that more than half of U.S. GDP comes from family-controlled businesses. Yeah, we family business owners are kind of a big deal. We also provide millions of jobs, help give meaning to our family members’ lives, pride ourselves on strong cultures and impact our communities. These things we have in common.

One aspect of business ownership we typically don’t have in common, however, is the transition process between generations. Like snowflakes, no two successions are alike. In some cases, succession may not look like succession at all, but more like distribution (e.g., a third party offers an irresistible sum for the business and the family goes on to co-manage a family office) or evolution (e.g., a first-generation entrepreneur says to her children, “My gift to you is not this business but the gift of entrepreneurship. I’ve built my business. Now go build yours.”).

And, of course, there are those families (like mine) that have participated in the succession of an operating company between generations. Even though each of these transitions is unique, we share many of the same challenges. These challenges are big, and often stubborn. We all deal with concrete topics like succession planning, shareholder agreements and financial training, any of which can foul the well water. But more often it’s the soft stuff that is the hard stuff, like parent-child relations, melding the values systems of families-of-origin and married-ins, and balancing the encouragement of individual pursuits with a sense of collective stewardship for the enterprise.

My family’s journey through three-plus generations has shown that some elements of successful transition have been constant, such as children working in the business during school summers, early-career adults developing a deep passion for the company, and the controlling shareholders running the business like a business. The similarities among successions, however, pretty much end there. The sequencing of events, the leadership and management changes, and — most important — the evolution of governance all vary. Another family business owner and I recently developed an appropriate precept: “There are an infinite number of ways that a succeeding generation can govern the business. The only one of those ways that definitively will not work is the one that the controlling generation develops for them.” The three complete chapters of our family’s journey prove this. Chapter Four (G3 to G4) still has much to be written.


Our first chapter features my grandfather, Harold Yoh. A lifelong entrepreneur, he sold pelts from animals he’d trap near the Ohio farm where he was raised, became the first person in his family to attend college (at The Wharton School, no less) and eventually bought into a tool design business just prior to World War II, soon renaming it the Yoh Company. He transformed the business into a temporary technical staffing company, which today is in the top 1% of U.S. staffing firms. He practiced the entrepreneurial principles of growth, diversification and risk taking. Eventually, he acquired Day & Zimmermann, a diversified technical services business focused on engineering, construction and government contracting. Founded in 1901, D&Z was four times the size of Harold’s eponymous company at the time of the merger. Today the Yoh family continues to own and operate D&Z, and the Yoh Company remains one of D&Z’s core operations. Our 117-year-old business employs 43,000 people and has operations throughout the world.

Harold had many children, but only one, Spike — his firstborn and my father — ever joined the business. Spike spent every summer from middle school through college working for the company. He learned to embody the same business principles his father held, and his business acumen advanced. Chapter One had all the elements of the great American success story.


Chapter Two was not as auspicious. The father and son had a contentious relationship, spawning in part from Harold’s divorcing Spike’s mother and marrying his secretary when Spike was barely a teenager. During the early years of Spike’s full-time career, he felt that “the old man” never had a good word to say about him. Despite this animosity — or maybe because of it — Spike chose to dedicate his career to Day & Zimmermann, eventually committing to acquire it. Harold, however, provided him with little mentorship and few succession plans.

By the mid-1970s, the company had grown to over $100 million in revenue, with an attractive munitions manufacturing business that caught the eye of two large defense contractors. This attention encouraged Harold to cash out and forced Spike to construct a deal that would beat the outsiders’ offers. The father was not interested in facilitating a deal for his son. In a novel double move, Spike orchestrated both a management buyout (by uniting the other key executives and offering them ownership stakes) and a leveraged buyout (by partnering with a bank willing to collateralize the company’s receivables to finance the purchase). Despite their differences, the Yohs struck a deal, and Chapter Two concluded.


Chapter Three, the transition from G2 (Spike) to G3 (my four siblings and me), was an antithesis to the preceding story. In the early 1990s, Spike and Mary, our mom, took us to a Young Presidents’ Organization family business conference, after which we began having routine family meetings to discuss the business. In the mid-1990s, still a few years before Spike would retire, he had the foresight to instruct us children to start meeting formally as a five-some. He knew we would have to get to know each other far better than typical siblings if we were to be an effective ownership group. We recognized a number of metaphorical “hats” that we would wear. At times we would be owners. Sometimes we would be employees. At others we would be just siblings. Of course, the hats frequently overlapped. We also examined our childhood relationships, identified our personality types, and assessed how our individual aspirations jibed with each other’s and with the future needs of the company. The succession soil was tilled.

Still in his early 60s but after two years of deliberation, Spike decided to retire, implementing a succession plan for his oldest son, Hal, to replace him and initiating a stock transfer that would put his five children, with an average age of 33, in control of a $1.1 billion company with 16,000 employees. A main factor in Spike’s decision to hang ’em up at a relatively young age was his observation that too many family business leaders stayed in charge too long, stunting the leadership growth of the next generation. This transition — with many years of deliberate preparation and several best practices implemented — stands in stark contrast to the previous one. In particular, Spike and Hal both consider the succession plan period, during which Hal reported to Spike in a newly created president role, a highlight of their careers. 

But this chapter was not complete. Even after org charts are updated and financial transactions closed, generational succession continues. As newbie owners, my siblings and I recognized that our work was just beginning. To facilitate the transition to much younger ownership, we developed and implemented three strategies designed to show our employees, particularly our senior managers, that we were committed to their continued involvement and career progression.

The first of these efforts was a phantom stock program, wherein non-family senior executives earned the ability to participate financially in the appreciation of the value of the business just as the shareholders do, thus aligning our interests. The second was the formation of a board of advisers (BOA), which furnished the CEO and leadership team with feedback and advice regarding financial performance, strategy and talent development. It has provided us with the proverbial “gray hair” experience that such advisory bodies can give — although by now we owners have developed plenty of our own gray hair! The final measure we put in place was a “meritocracy” process whereby we assigned the BOA the role of approving any management promotion involving a Yoh family member. Over the years, the BOA has at times recommended against a family member getting a new job, demonstrating the teeth this process has. These nepotism safeguards are still in place today. We have experienced little voluntary turnover in the executive team, and the company has grown tremendously, poised to eclipse $3 billion in revenue in the near future.

Two of my siblings elected to leave the business during our ownership tenure. Both departures were amicable, even though the siblings were required to sell their stock. One of the stipulations Spike included in our shareholders’ agreement was that a family member had to work at the company to own stock. A common practice among early-generation family businesses, “work to own” ensures that the people in control of the business are intimately familiar with it and committed to its wellbeing, perpetuating the objective to run the business like a business. This owner-operator model can also better promote the interests of the entire ownership group (current and future) by taking a longer-term view, as opposed to non-working owners who might, for example, prefer to maximize personal short-term gains at the expense of growth and stability. 


Thus ends our third chapter. Chapter Four, the future succession from our generation to our children, will involve a few important and unique dynamics. The first of these is age. The cousins fall into two cohorts, five of them in their 20s and 30s and six who are 18 and younger. The 25-year age gap from oldest to youngest essentially makes our G4s a generation and a half. Another new dynamic is diversity. This generation not only has been raised in multiple households — with the important influence of married-ins — but also has a wide range of interests, skill sets, and political and religious beliefs. From business research it is known that the best teams are diverse and well-managed, while the worst ones are diverse and poorly managed. Our next generation is currently somewhere in the middle, a collection of smart, passionate individuals with elements of both esprit de corps and independence.

Our efforts to inculcate them with a love for the business have been a work-in-progress. All members of G4 above 16 years old have worked at the company, and one member continues to work there full-time. While this professional exposure has helped build familiarity and connectedness, our initial formal education activities had somewhat of the opposite effect. The efforts entailed several years of renting out conference center board rooms, presenting information-rich PowerPoint slides, and arranging briefings from estate attorneys. We talked about death scenarios and the need for life insurance, as well as the always-fun topic of pre-nups. One older member of G4 described these sessions as being like root canal — you know it’s necessary, but that doesn’t mean it’s not painful. Needless to say, these meetings, which lacked recreational activities, service work, facilities tours or meaningful team building, did not do much to ingratiate the next gen to the business.

What we missed initially — and what many successful multigenerational enterprising families emphasize — was creating collective opportunities for fun and bonding. As one family business patriarch said at a recent conference, “If you really want to be a family in business, you have to be friends, and to be friends, you have to spend time together.” This person, along with several other successful business-owning families, participates in endowed vacations, where the company funds opportunities for owners to spend time together with little more than a light touch of business content. We have recently started to model this approach, focusing more on creating cousin bonding opportunities centered on fun exercises, sporting events and summer recreation. We now allow for more optionality regarding attendance, the objective being that if someone shows up, that person is there of his or her own volition, not because the event was dubbed a “command performance.”

The biggest change we have made in preparing for a fourth generation of ownership was removing the “work to own” requirement in our shareholders’ agreement. We did not want to limit our children’s life and career decisions based on whether or not they’d want to own D&Z. However, we still believe, as our father did, that the company should be governed by those shareholders most closely connected to it. So concurrent to removing “work to own,” we contributed all of our voting stock to a new trust, the trustees of which must be family members who are either executives at the company or serving on its board. Perhaps most unique to our situation, should there not be a family shareholder in either of these roles when a trustee seat becomes vacant, that seat will go to a non-family executive or board member. That’s how committed we are to ensuring the long-term success of the business. We are equally committed to allowing our next generation to decide if they want to join the business or not. We now have the opportunity — and the challenge — of imbuing in them the stewardship ethos required to govern the family enterprise when our generation’s time has passed.

Our company has evolved, as has our governance model. Our current chapter continues to be written; our journey continues to unfold. We hope our story helps you and yours along your path. What the world needs is more success in succession. We all are the ones to make that happen.     

Bill Yoh is a third-generation owner of his family’s 43,000-employee, century-old business, Day & Zimmermann, and the chairman of Yoh, D&Z’s multinational staffing company. He is the author of Our Way: The Life Story of Spike Yoh and speaks and writes regularly about his trademarked approach to family business, Familytics ( 

Copyright 2018 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permission from the publisher. For reprint information, contact



Stevens Brothers Cartage and Storage was founded in 1905 in Saginaw, Mich., to haul steamer trunks using horse-drawn drays. Today The Stevens Group, still based in Saginaw, is a full-service moving company run by the fourth and fifth generations. Its longevity is a testament to the Stevens family’s focus on education and governance—and ongoing succession planning.

Frederick H. Stevens Jr. started the business across from the Michigan Central Railroad Terminal. His brother Henry was part of the business from 1909 until he left to fight in World War I. Their father, Frederick H. Stevens, worked in the business as well. When the company was founded, there were no trucks and highways; Stevens Brothers moved goods from the railroad depot to local destinations.

Although Frederick Jr. founded the enterprise, the family considers him as G2 because his father also worked in the business. By the 1930s, improved roads and trucks made it possible for regional movers to haul longer distances, leading to the rise of national van lines. Diversification into the furniture business helped Stevens survive the Depression.

In the early 1940s, the business passed to Archie Stevens Sr. and his younger brother, Hazen, who were Frederick Jr.’s sons.

“My dad would bring me down on Saturday mornings when he would work,” says Archie’s son Morrison (Morrie) Martin Stevens Sr., 70, now the chairman and CEO. “When I turned 16, I started working on the trucks.” He did this during summers from age 16 through college, the last two years driving a semitrailer.

In the 1950s, the development of the interstate highway system—along with improved road conditions, an increasingly mobile society and larger semitrailers—resulted in productivity gains. The need for relocation services increased as large businesses established satellite locations around the country. Later, the rise of international corporations fueled demand for international moves.

Archie Stevens Sr. bought out his brother in the early 1960s. In 1977, Archie’s four sons—Archie Jr., John, Jim and Morrie—took over.

The fourth-generation sons worked together until 1986, when the oldest brother was bought out. Morrie acquired his other two brothers’ stakes in the business in 2003. These successive buyouts meant that the business entered the fifth generation with just four G5 siblings involved, rather than a proliferation of cousins.

“We are a company that is 112 years old and, outside of the ESOP [employee stock ownership plan], all the shareholders are from one family branch,” says Lindsay Stevens Eggers, 41, president and chief operating officer. Morrie Sr. and his children together own 69% of the company; Morrie Sr.’s share is about 46%. The remaining 31% is in an ESOP trust.

Morrie Stevens Sr. and three of his four children—Morrie Stevens Jr., Lindsay Stevens Eggers and Peter Stevens—along with Joe Biskner, the executive vice president, are voting members of the board of directors. Several outside advisers serve as non-voting members.

Today, The Stevens Group consists of four primary entities, the largest of which is Stevens Worldwide Van Lines. (The others are Focused Logistics, Military Domestic Forwarding and Stevens Forwarders.) The Stevens Group has nearly 160 employees and generated $95 million in revenues in 2016.

That year, Stevens helped 850 families with local moves, 9,400 families with longer domestic moves and 2,470 families with international moves. The company also performed more than 900 office and industrial moves.

A turning point
In 2007, Morrie Sr. wanted to start easing into retirement.

“It’s always been our wish for the ultimate leadership of our company to be family,” says Angie (Stevens) Mehring, 46, the oldest of Morrie Sr.’s four children and a marketing specialist for the company. “But we recognized that when my father wanted to step back a bit, among the sibling team nobody was quite ready to assume the helm.”

So Morrie Sr. appointed Biskner, a non-family member and longtime company executive, as president and COO “to allow the children to continue to refine their skill sets and their business maturity,” the patriarch says. “I said, ‘I don’t know how long it’s going to be—we haven’t decided who is going to succeed you from a family standpoint, and we’ve got to determine when they’re ready.’ 

In late 2016, the time came for a decision. The fifth-generation siblings called a family meeting to announce that their generation was ready to lead the company. “Our dad had been talking about succession planning, and finally we said, ‘We’re ready.’ We took the initiative and built the business case for change,” Stevens Eggers says.
The challenges facing the industry figured into the choice of a future leader.

“The industry has been impacted since 2007 by the declining mobility rate in this country,” says Morrie Sr. The number of people who moved declined during the recession, and even as the economy recovered, technology made it easier for people to change jobs without moving. “There has been a lot of shrinkage in the industry,” Morrie Sr. says.

Given these external challenges as well as the complexity of the business, the group reached a consensus: Stevens Eggers, with her finance background, was the best person for the job.

In the spring of 2017, Stevens Eggers became president and COO, and Biskner returned to his prior role as executive vice president.

“Lindsay will do a great job being president,” says her brother Peter, 34, director of moving and storage. “What was best for the company in this current transition was for me to continue in my current role. My division is improving, and there is still improving to be done.”

The succession question “was definitely the elephant in the room,” Stevens Eggers says. “It put my dad in the awkward position of picking somebody. Now that I have been chosen, it removed that.”

Stevens Eggers told the family she will probably leave the position after five or six years, since her husband may want to retire at that time. Whether she will assume the title of CEO before she retires has not been decided.
The family members are already thinking about who might lead the company after Stevens Eggers.
The two obvious candidates from within the family are Morrie Jr., 44, currently vice president of the commercial agency division, and Peter.

“I committed to my two brothers that I would love for one of them to be in a position like I was,” Stevens Eggers says. “I told them, ‘I’ll do my best to make sure that you have the development, the coaching and the resources so that we can keep the leadership at the family level.’ ”

“If it’s within the family, it would be my brother or myself,” Peter says. “How do we prepare each of us for that next step? In family businesses, that’s always a touchy subject. My brother and I get along very well—we hunt together, fish together. You can see how families can get torn apart by these decisions. We will make sure that does not happen.”

Different career paths
Stevens Eggers came to her job via a consulting career with Accenture that took her to Paris, Zurich and California. “I never really thought I’d work for the family company,” she says.

Her high school work experience at the family business was brief.

“I filed papers,” she says. “I think I quit after about two weeks because it was so boring.”

In college, she had a summer job with the international division. “That was my first exposure to understanding the operations of our business,” Stevens Eggers says. “It gave me a better understanding of the complexities of the household relocation business.”

But after about seven years as a consultant, she was looking for a change. “I wanted to be part of a company and to add long-term value,” she says. “I wanted to see the long-term impacts of projects I was working on and be part of a team.”

On a summer vacation, she told her father she was interviewing for corporate finance jobs. He told her that the company’s chief financial officer was planning to retire in a few years and asked if she would be interested in joining the business to eventually take his place. She agreed, and spent her first two years rotating through the company to learn the business. During the three years after that, she worked directly for the company controller in the finance organization. She also completed an executive MBA program at the University of Michigan’s Ross School of Business.

When the CFO retired, Stevens Eggers became vice president of finance, a position she held until she became president and chief operating officer.

Peter developed a strong interest in the business as a child.

“From an early age, I’d frequently come into the office with my dad on Saturdays,” Peter says. “I wanted to go out in the truck yard and climb in the trucks and honk the horns.” He started working for the business as a teenager, at first sweeping floors in the warehouse and maintenance garage. Once he turned 16, he began helping with moves. He got his commercial driver’s license when he turned 18.

“The only thing I ever thought of was working for the family business,” Peter says. Immediately after graduating college with a bachelor’s degree in business administration, he became a relocation consultant at Stevens’ Cleveland office.

Later, he worked in Sarasota, Fla., rising to general manager of that office. When a position opened up at headquarters, he and his wife moved back to Michigan.

“Moving back to headquarters allowed me to get more involved in the leadership team,” Peter says. “I became a member of the safety committee and the steering committee and got more involved in the bigger parts of the company.”

Morrie Jr. also grew up with the family business on his mind.

“I was groomed to work in the business, starting at a young age,” he says. “I used to clean the tractors when I was 10 or 12 years old. I’d get paid 50 cents a truck to sweep them out and wash the windshields. When I turned 16, I started officially working on the trucks.” During high school and college he drove on regional moves.

Once out of college, Morrie Jr. worked in sales in the company’s Detroit office for about seven years. He left for about a year and a half to gain some outside experience—and to allow his father, who was considering whether to buy out his brothers or sell the business, to make a decision without worrying about where his son would work. He returned to the company as western regional vice president, based in Denver, for about four years. He then moved back to Michigan to be closer to family and run the commercial agency division, which handles the company’s network of van lines for long-distance moves.

Focus on education and governance
Morrie Sr.’s 2003 decision to buy out his brothers led him to focus on educating his family about the business and formalizing its governance.

A family council was established in 2004. The council includes family members and spouses, and each household has one vote.

At first, the meetings covered the basics of the company’s finances, taxes and real estate. The council developed a family constitution and policies on issues such as family employment, compensation and charitable giving. The meetings have since evolved to focus on educating the shareholders about more complex issues, such as succession planning, leadership development, visions for the company and how to work through challenges together.

The family selects a business book—like Jim Collins’ Good to Great or Bill George’s True North—to read and discuss at the next family council meeting. The family council also runs the Stevens Family Foundation, which is funded through annual private donations from Stevens family members. The foundation focuses on grants to local non-profit organizations that focus on youth, arts and education. 

Family council meetings also include time for the siblings to meet with a family business consultant, without their parents or spouses present. This allows the siblings to be transparent with one another about the support they need in their respective job roles and also to develop as a solid sibling team leading the business, Mehring says.

“We are a very strong, loving, Christian family. We gather for holidays and family celebrations and at the [family’s vacation] cottage and enjoy each other’s company,” Mehring says. “However, we have the dynamics of working together, and when there is stress from the business, this can carry over to our relationships with each other. With the sibling meeting time, we can rely on it as a safe zone for just airing it all out, putting our challenges on the table and having the presence of the family consultant there to guide us through the times when it gets messy.”

For Mehring, the creation of the family council gave her both an education about the business and a stronger sense of connection to it. She had worked in hospitality for seven years after college, then joined the family business in residential sales in the Cleveland branch. She and her husband eventually settled in Milwaukee, and she returned to the hospitality industry.

“I was struggling a little bit with not contributing to the day-to-day activities of the business,” Mehring says.
Her mother, Julie Stevens, chaired the family council for the first three years. Mehring took over as chair when she left the workplace for a few years to raise her children. She later returned to do part-time marketing work for the company while continuing to serve as family council chair.

“It gave me an opportunity to serve the business,” Mehring says. “My background is in meeting planning, so it was a natural fit.”

Today, the family sponsors the Stevens Center for Family Business at Saginaw Valley State University. Julie Stevens was the center’s first director and headed a campaign to raise an endowment for the center.
The family is starting to consider how to extend its focus on education to the sixth generation, whose oldest member is just 12.

“They do visit headquarters, and Grandpa will often take them out to the warehouse, put them in a truck or give them a tour of the office,” Mehring says. “We have not done structured meeting activities with them yet, but I see that in the next few years.”                                                  

Margaret Steen is a freelance writer based in Los Altos, Calif.

Copyright 2017 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permission from the publisher. For reprint information, contact

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The Jacobs family believes in taking a long-term approach but doesn't shy away from non-traditional management ideas. This year they celebrate the 100th anniversary of Delaware North, their burgeoning hospitality service empire, by inaugurating a trio of CEOs.

The company has had only two chairmen in its history—a statistic that remains unchanged despite recent management moves. "We're a group of professionals who have spent our lives in this," says patriarch Jeremy Jacobs, Delaware North's second chairman. (His father was the first.) "There's a desire every day to make it better and to grow it bigger."

Jeremy took a long-contemplated transition step at the end of 2014 when he announced he was relinquishing his title as CEO while remaining as chairman. His two oldest sons, Jerry and Lou, will serve as co-CEOs of Delaware North. The youngest son, Charlie, will become CEO of the family's Boston properties, which include the TD Garden, home of the Boston Bruins, a National Hockey League team owned by the Jacobs family, as well as basketball's Boston Celtics.

Progress toward succession has been slow and deliberate. Numerous consultants and advisers were engaged along the way. Hard lessons Jeremy learned from the sudden death of his father and the tumultuous times that followed (which included multiple federal investigations of the company) also have shaped how he and his sons are carrying out the transition.

Jeremy Jacobs is well known as the chairman of the NHL and owner of the six-time Stanley Cup-winning Bruins. Delaware North, the Buffalo, N.Y.-based family enterprise, encompasses various operating companies that provide concessions at sports venues around the world; run casinos and racetracks across the country; feed and entertain 350 million airport travelers; and provide lodging, food and recreational opportunities at some of America's biggest national parks.

Jeremy's father, Louis Jacobs, founded the company in 1915 with his two older brothers in Buffalo. Louis sold peanuts at the city's ballpark and popcorn at a local burlesque house while his brothers rented canoes and shined shoes at Delaware Park Lake. The trio won a Major League Baseball concession contract from the Detroit Tigers in 1930, a relationship that exists to this day. Louis eventually bought out his brothers when their health deteriorated. Louis's son Jeremy later bought out his two brothers, Mark and Lawrence, who pursued other interests. As it grew, the company changed its name from Jacobs Brothers to Sportservice to Emprise and, finally to Delaware North, the name of the two streets in Buffalo where it was originally located. In 2014, Delaware North reached $3 billion in annual sales, employed 60,000 associates and served a half-billion customers.

"We've evolved from sports to race tracks to arena management, and we've got a real estate project in Boston that's pretty serious," Jeremy says. "I hope the family grows itself into the future."

Growth is very much on the mind of Jeremy's three sons, Jerry, Lou and Charlie. They're even more concerned with preserving value for the future, however. "We take ourselves quite seriously in what we do, but we also have a sense of humility about us," 44-year-old Charlie says. "We're committed to our company's future and we have an active, informed shareholder base. That really helps for long-term stability." His brother Jerry is 53; Lou is 51. They have three sisters: Lynn Reichenbach, 55; Lisann Jacobs, 54; and Katie Robinson, 48. All are shareholders, although only the three sons work for the company. Jeremy Jacobs has 18 grandchildren and two great-grandchildren.

Learning from the past

Jeremy is now 75, robust and actively involved in company management. He shares many responsibilities with his sons while concentrating more on NHL matters and philanthropic interests with his wife, Margaret. Jeremy has long worked to prepare his sons for the transition. The need to be ready was a lesson he learned the hard way when his own father, Louis, died suddenly in his office in 1968, leaving the company in Jeremy's hands at the tender age of 28.

"I was not ready for it," Jeremy says. "Nobody should go through that." On the other hand, he adds, "If you can live through it, you gain a great deal of knowledge. But I would not subject anybody to that." Jeremy had worked for this father his entire life. "He was tough—a hard guy to outwork," he remembers. "He worked seven days a week, 20 hours a day."

His father left behind a flourishing company with some $50 million in sales at more than 500 operating units, including England's Royal Ascot Race Track, the New York World's Fair and innumerable baseball stadiums. But the company also had some unsavory aspects that caused serious problems for several years. The U.S. Justice Department began investigations in 1972 into possible antitrust violations, labor union contracts and connections with organized crime by Delaware North predecessor company Emprise. The investigations culminated with the conviction of the company (along with six reputed mobsters) for concealing ownership of the Frontier Hotel and Casino in Las Vegas. The company's pari-mutuel operations and liquor licenses were severely affected, and Jeremy spent years working to recover the company's good name.

"It made you stop and think about everybody you do business with," he says today when asked what lessons he learned during that time. "You have to examine them and you have to be more responsible for the personalities you expose yourself and your business to."

Lou Jacobs says his father firmly passed along that concept to him and his siblings. "The lesson of those accusations is what a blotch on our reputation could mean to our business," Lou says. "We're very hypersensitive to that type of thing." The proof that the lesson was learned is in the company's success today. "We do a lot of business with national parks, port authorities, municipalities, airports," Lou points out. "Whether it's the racing commission, or liquor licenses, or the parks commission, or the city of Chicago or Atlanta, we have to make sure we're indisputably ethically clean."

Holding high-profile positions like Jeremy's NHL chairmanship, however, involves scrutiny by sports fans and the press. The 2012-13 NHL player lockout generated harsh backlash, and the family's dispute with a Wellington, Fla., real estate developer was the subject of an unflattering Boston Magazine article that same year. "Occasionally, there are issues that we become involved in that are played out in the public landscape," Lou says. "In the case of the lockout, our father is the chairman of the Board of Governors for the NHL, and his role in ensuring the league's health and success is something very important to him. It was unfortunate that the lockout happened, and no one wanted it—especially him." Jeremy Jacobs received the St. Jude Award for Inspiration in Sports at the Global Sports Summit, a meeting of sports franchise leaders and owners, in August 2013, and the NHL was named "Sports League of the Year" for 2013-14 by SportsBusiness Journal and SportsBusiness Daily.

Lou says of the Wellington controversy, "It's a complicated issue, with a Boston real estate developer attempting to commercialize a protected preserve. We will continue to work hard to see this area protected, as it's important to our family and important to the community. We do not shy away from supporting candidates and causes that are important to our family or to our company."

Training ground

In addition to teaching them to stand fast for their beliefs, Jeremy also made sure his sons really wanted—and were capable of—responsible positions in the company when they came of age. All three of them worked elsewhere for several years and worked their way up within Delaware North across a range of jobs and divisions. "When I graduated from college, he told me to go find a job on my own," Jerry says. "Dad wanted me to know what it was like to hold a job before I came to work for him."

The sons didn't have it easy after they joined the company, Jerry says. "He was very hard on me in terms of his criticism. It was always a little heavier than it was on others. Not that he wanted to toughen me up, but because he wanted to make it abundantly clear to me and everyone else that I wasn't entitled to anything." Jerry says that approach had two positive outcomes. "In order for me to do my job, it was important to know I could do it on my own," he says. "You can't be a strong leader if you don't have self-confidence. Looking back, I wouldn't have the respect of the executives I work with today if it had been any other way. It was a gift he gave me." With a laugh, he adds, "I can say that now."

Until their appointments as CEOs, Jerry, Lou and Charlie held the title of "principal" of Delaware North. They don't so much divide their duties as surround them. "We really try to operate as a group of three," Charlie says. "We each have our own direct focus day-to-day, but we try to be interchangeable." He oversees the large Boston operation, which includes the Bruins, TD Garden (which is undergoing a $70 million upgrade) and a nearly 2 million-square-foot mixed-use project under development adjacent to the arena. He travels to Buffalo, where his brothers are headquartered, for weekly management meetings chaired by his father every Monday.

"We have a partnership model we're working on, where we work very closely together," Jerry explains. "Lou's office is across the hall from mine, and we bounce decisions off each other until we come to agreement. It works very well." None of the three professes to have or want a dominant leadership position.

Management and the board

Another lesson Jeremy learned from his long experience is the importance of professional, non-family management in a company the size of Delaware North. "To think we possess all the knowledge and professionalism within the family is misleading," he says. "We seek out the best and brightest in the professional management of the company." The family incentivizes top management and keeps career paths open. "To say you can't be 'president' if your last name isn't Jacobs is to cut people off," he says.

Chuck Moran, who joined the company in 1992 as a VP of finance, is Delaware North's president and chief operating officer. "We've also taken a lot of time to beef up the next level of professional management," he observes. "We've brought on a lot of people over the last ten years, groomed them, and switched assignments to give them diverse experience. We're preparing for the next transition." Current plans call for him to retire at the end of 2015.

The company also has a strong, active board of directors, a majority of whom are independent members. "We look for people who have both related experience in the business and those who have unrelated experience because they bring a different perspective," explains Delaware North director Howard Fluhr, who is also chairman of consulting firm Segal Company. "In a private company in general, in addition to the obvious fiduciary duties, you want to have a range of points of view on the board. That's even more important in a family business."

Jeremy Jacobs and his sons serve on the board, along with six outside directors with backgrounds in finance, sports law, hospitality and consulting. The board meets four times per year. At each meeting, Moran gives a report and operating managers make presentations about various aspects of the business and pending matters. "That gives us not only insight into what's going on, but exposes the board to those people as well," Fluhr says.

Jeremy purposely built a strong board. "The quarterly reviews, compensation committees, audit committees—in a family structure they get lost," he points out. "But in the corporate structure, the board forces that upon you. That's one of the better things we did years ago."

Family governance

When it comes to completing the transition to the third generation, Jeremy says the plan must be developed and carried out by his sons. "They spend a lot of time making sure they don't get in one another's way," Jeremy says. "It will happen within that structure."

Jerry concurs. "He's absolutely right. If we don't come up with a solution that's ours, it's worthless. Of course, the real test will be when our father is no longer around."

"They have such a great formula with Charlie, Lou and Jerry all working together," says 48-year company veteran Rick Abramson. "They all have different thoughts and points of view, but when one talks, he speaks for them all. It's a strong, unified family."

This didn't happen by accident. "My brothers and I decided we wanted to work better together and get to another level of performance," Jerry explains. "We brought in a consulting group to help us do that." They adopted the High Performing Team model from Guttman Development Strategies. "It was a lot of work, a lot of drama; many, many hours of thinking this through and talking openly about how to do it," Jerry adds. "It's worked very, very well."

"On the family side, they made a deliberate choice to do this just as siblings, as opposed to involving their father," says Stephanie Brun de Pontet of the Family Business Consulting Group, who has worked with the brothers on family governance issues. "They felt it was important for them to gel as a group for the future. The dynamic would be different if their dad was in the room."

Jerry points out that they are deeply invested in sound family governance practices. "We have regular shareholder meetings on a quarterly basis," he explains. "That group includes the six siblings, and we present the same financial data the board gets. We discuss the strategic direction and major moves in management. We get their feedback, and that goes into the equation." In addition, he says, "We just formed a family assembly, which includes spouses and G4s. Then we have a family council, which consists of the six siblings. It deals with the business of the family, not the business of the business. The shareholder meetings are about the business."

Although no other family members currently work at Delaware North, Jerry says, "We've crafted a family employment policy and begun to take steps connecting to G4 in terms of what opportunities the company might offer and how they might go about pursuing them. We've been very careful to make sure there are no expectations that family members work in the business. We don't want to make it a burden. It should be more of an opportunity."

He summarizes the family's careful approach to the intersection of family and company business by observing, "We watch closely what happens around family-owned companies. We've seen how family disputes can pour over and destroy a good business. We've seen how business decisions can be made on an emotional family basis that is really wrong for the business. Our mantra is, 'We're trying to protect the business from the family and protect the family from the business.' "

"All of it is in the interests of long-term continuity," says Brun de Pontet. "They understand that, in order to succeed over multiple generations, it's important to invest in the family relationship as well as the strong business practices they have developed." 

Dave Donelson is a business writer in West Harrison, N.Y., and the author of the Dynamic Manager Guides and Handbooks. 

Delaware North around the world

Delaware North Sportservice is the oldest and second-largest (with 27% of revenue) division in the company, with 55 clients like Busch Stadium in St. Louis and CenturyLink Field in Seattle. The division, which harkens back to the company's roots by operating food, beverage and other concessions at stadiums, has served customers at Super Bowls, the Olympics, the World Series, and even the Little League Baseball World Series in Williamsport, Pa.

The largest division is Delaware North Gaming & Entertainment, which generates about 29% of the company's revenue. This unit specializes in racing venues with added video gaming, table games, full-service restaurants, retail shops and hotels. You won't find these venues in Las Vegas or Atlantic City, but the company has steadily built business in places like Memphis, the Quad Cities and Cincinnati. In early 2014, the company gained the right to build a video lottery terminal on New York's Long Island.

Delaware North got into the national parks concession business in 1993 when it won the contract to serve visitors to Yosemite National Park. Today, it also manages the Kennedy Space Center visitor complex and Shenandoah National Park, among dozens of other attractions. In addition to the government contracts for operations on park property, Delaware North has invested in numerous resort, food and lodging properties of its own adjacent to them, like Tenaya Lodge at Yosemite.

Travelers passing through Los Angeles, Atlanta, Newark and dozens of other airports around the world eat at hundreds of restaurants and other facilities operated by Delaware North Travel & Hospitality. The company recently acquired the Patina Restaurant Group, whose high-profile portfolio includes New York's famed Rockefeller Center Ice Rink and Rock Center Café, the Grand Tier Restaurant at the Metropolitan Opera, and the Michelin-starred Patina Restaurant in the Walt Disney Concert Hall in Los Angeles.

International operations are a growth center for Delaware North. In 2014, it debuted a joint venture with a local concern to provide catering and food services to the Singapore Sports Hub, marking a return to the Asian market after a 20-year hiatus. In Australia, Delaware North owns several resorts and recently extended its concession contract with Melbourne & Olympic Parks, home of the Australian Open Grand Slam tennis tournament. On the other side of the globe, Delaware North serves soccer fans at two of the three largest stadiums in London, Wembley and Emirates.   —D.D.

Copyright 2015 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permission from the publisher. For reprint information, contact

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If ever there were an industry that lends itself to family ownership, it’s the wine business. At least that is the thinking of the Mariani family, owners of Banfi Vintners, importers and producers of wines from around the world.

“Wine is not a short-term business,” says Banfi co-CEO Cristina Mariani-May. “It requires patience, which is something family ownership brings. Also, a lot of our wholesalers and leading producers around the world are family-run, too, and families working with other families carries a lot of weight.”

The company, based on Long Island, N.Y., and founded in 1919, is well into a deliberate, step-by-step transition to the third generation. The Marianis have worked with a family business consultant for more than ten years to ensure their enterprise remains under family ownership and management.

Cristina, 42, and her cousin James Mariani, 48, currently serve as co-CEOs in an arrangement that mirrors the team leadership provided by their fathers. Second-generation members John Mariani Jr., 81 (Cristina’s father), and Harry Mariani, 76 (James’s father), still have active roles as chairman emeritus and president emeritus, -respectively.

The co-CEO arrangement was developed through the family’s work with the Family Business Consulting Group. It is but one of many manifestations of the process the Mariani family has undergone to address transition issues, governance and even operations. The family also works with Partners Consulting in Milan, Italy, since the company’s Castello Banfi vineyard estate in Montalcino, Tuscany, is an important profit center as well as a great source of family pride. “The two teams know each other very well,” says Cristina. “They work in unison so we can make sure that strategically, managerially, and organizationally, we are aligned in all of our businesses.”

Multiple market segments

Banfi’s headquarters, a 60-room manor that once served as a country retreat for members of the Vanderbilt family in Old Brookville, N.Y., underscores the company’s devotion to longevity. It’s filled with museum-quality furnishings and artwork. A 12th-century Tuscan table and 17th-century George Brooke grandfather clock grace the library, which stretches across the building’s west wing.

The $358 million company is one of America’s leading wine importers. It jumped to prominence in 1969 when it introduced Riunite Lambrusco, a light frizzante varietal that struck a spark with Americans weaned on soft drinks and fruit juices. Marketed through variations on the slogan, “Riunite on ice … that’s nice!,” it became the country’s leading imported wine for 26 years.

That success was quickly followed by distribution deals for Chilean wines like Frontera and Walnut Crest, currently the best-selling wine brands in the portfolio from Concha y Toro of Chile, which sold 2.4 million cases in the U.S. in 2012. Two million cases of the Riunite labels were sold last year. In 2011, Banfi acquired Pacific Rim Winemakers, a deal that gave the company small vineyards in Washington and Oregon.

But popular wines are only part of the Banfi story. The company also imports top luxury wines like Brunello di Montalcinos: Poggio all’Oro Brunello di Montalcino Riserva, which retails for $150.

The family also produces wines of its own at both foreign and domestic vineyards. Castello Banfi, established in 1978, was named “International Winery of the Year” at the International Enological Concourse in Verona. Overlooking the vineyards is a medieval fortress meticulously restored as a hospitality center that boasts a glass museum, an enoteca and two restaurants. The family built a 14-room boutique hotel on the property. Among other interests in Italy, Banfi tends two vineyard estates in Piedmont. About one-third of total revenues come from Italy, the rest from the U.S. importing operations.

Growing with the industry

Banfi was founded by John Mariani Sr., an American of Italian descent who established the company in New York just a year before Prohibition. For the first 13 years, he kept it alive by importing Italian specialties and spices as well as manufacturing medicinal bitters, an alcohol product permitted under the law. When Prohibition was repealed, Mariani stuck deals with several Italian vintners to bring their products to the U.S. The company was named after his aunt, Teodolinda Banfi, chief of the household staff of Pope Pius XI, with whom he and his mother lived during much of his childhood.

John Sr. and his wife, Eva, had three children, all of whom joined the family business as adults. Their daughter, Joan, was the first, although she left the company five years later when she married. John Jr. came on board in 1956 after college and a two-year stint in the army. Harry, the youngest, joined the staff a week after graduating from college in 1959. John Sr. turned the firm over to his sons in 1963 and passed away in 1972. “If my father and uncle saw further than my grandfather, it was because they stood on his shoulders,” says James, Harry’s son. “They brought it to a new level, and a lot of that was concurrent with the growth of the wine industry in America.”

Today, Banfi has about 500 employees (150 in the U.S.). Included among them are numerous third-generation family members in addition to the two co-CEOs. These include James’s sister Virginia and his brother-in-law Marc Goodrich (husband of his other sister, Katie); as well as Joan’s sons, Bob and Bill Whiting. John’s brother-in-law, Neill Trimble, is vice president of advertising. Ownership remains under the control of John and Harry, although it is being passed along through various tax-sensitive trusts.

“In the long term,” Cristina says, “we’re trying to leave the business stronger than when we entered it. The goal is to pass it along to the next generation.” She joined the company in 1993 and James joined in 1991, although both grew up in the business. They were named co-CEOs in 2008.

Long before then, explains Harry, “There was discussion about going public, and that was quickly sidestepped by both of us. But we had to discuss it with the third generation and they, too, quickly squashed that idea. Keeping it a family company helps keep that pride of ownership, without an obligation to outside shareholders. It would have been a diversion that would have made us run the company a lot differently, and not for the better.”

Enter the consultants

One of the earliest decisions Cristina and James made was to bring in a consulting firm to help iron out the difficulties. “We were too busy making wine, importing wine and selling wine to sit down and think about things like the difference between the relationships of brothers and cousins,” James explains. “We needed someone to facilitate this process. We were suffering some frustrations, but they helped us see that those frustrations are natural and our intentions all aligned.”

Cristina says she and James were experiencing typical youthful impatience with the pace at which control was being transferred but realized after working with the consultants that most of their frustrations stemmed from poor communications.

Steve McClure, principal of the Family Business Consulting Group, led the team that worked with the Marianis. “We first met with all of the family members who were actively involved in the business,” McClure recalls. “We spent a week with them, concentrating mostly on Cristina and James with the idea that they were going to build the plan for their own roles as well as for the governance function. The younger generation prepared a plan and presented it to the senior generation. Our role was to facilitate it and show them what some other family businesses had done in similar circumstances.”

The family found that process very helpful. “I found out very quickly that we did not have to reinvent the wheel in terms of family business,” Harry says. “Almost all of the problems that we faced were faced before by other family companies, and we could gain perspective from their experience.”

McClure says it’s not unusual for consultants to work with a client like the Mariani family for well over a decade. “Their needs change—it goes from planning for succession to multiple shareholders getting on the same page,” McClure says. For the Marianis, he says, “We helped them develop a board of advisers and create a plan for managing and adjusting their roles over time. It was a multi-year plan for them [Cristina and John] to gradually take over day-to-day operations of the business.”

The transition work in progress

At present, the co-CEOs, along with three outside members, serve on a newly constituted board of advisers that meets quarterly. “We bring it bigger strategic topics and air some of our concerns,” Cristina says. The independent members, who serve one-year terms, have varied backgrounds in M&A, wealth management and marketing. “We look forward to expanding the board to round out its expertise,” Cristina says. The outside members were recruited through wine industry networking.

One of the major decisions made in the transfer of operating control was to name co-CEOs. As McClure explains it, “The co-CEO arrangement was a facilitated option. The shared leadership directly replaced the divided areas of responsibility that Harry and John had. They [Cristina and James] have made adjustments around their skills and capabilities that don’t necessarily follow the job descriptions you would pull off the shelf for somebody else. They’ve tailored it for their business needs as well as their individual needs.”

The vineyard in Piedmont.Initially, James and Cristina divided responsibilities basically along geographic lines. He managed affairs in the U.S. while she devoted her time and energy to operations in Italy. “Now there is more crossover,” James says, “so we have to figure out, especially with our executive time, how we work with more overlap in responsibilities.”

The overlap is intentional, although each gravitates toward the areas in which he or she feels most adept. James leans a bit more toward sales and distribution while Cristina spends more time on marketing and brand building.

“We’ve really learned to work together,” Cristina says. “It’s not one person taking over one responsibility and the other not. We share almost everything with the other partner. It’s high-maintenance, but it works for us.”

Their personalities play a role, too. “We complement each other,” Cristina notes. “I might be a little more impulsive, while he really likes to think things through and be a bit more conservative in his approach. Bringing the two of us together makes a nice mix.”

The co-CEO arrangement isn’t too far removed from the way John and Harry managed the company as a sibling team, although they had more traditional titles of chairman and president, respectively. When it was first proposed, John told James and Cristina that open, persistent communication between them would be the key to making it work.

“The co-CEO arrangement was challenging at first, due to the human desire to succeed,” John points out, “but logic prevailed. Seldom does an individual acquire the talent to manage all business facets. Both have combined their talents to create a unique synergy.”

The fathers also stressed the need for the co-CEOs to work in unison. Essentially, each has veto power in the event of a decision deadlock, although Cristina says they go to great lengths to avoid it. “Our management team is our first sounding board,” she explains. “If we can’t get a clear picture from that, we usually call the consultants and bring it to the advisory board. If we still can’t resolve the issue, we decide to not move on it. A decision not to act is still a decision.”

The family also works with the consultants on communication with family members who are not active in the company, an important constituency as the number of cousins (six) and grandchildren (13) grows. “Once a year we have family shareholder meetings,” Cristina says. “It includes the cousins and siblings who are not working in the business. We bring them up to speed on what’s happening.”

In 2012, the Marianis decided they need a three-year strategic plan, so they brought in an additional consultant from the Family Business Consulting Group. “One [consultant] focuses on the family business aspects like transitions, board planning and keeping us in line with our roles. The other helps us with strategic work,” Cristina explains. “Selling fine wines and selling popular brands are two different businesses. The consultant helps us identify our strengths and weaknesses and figure out our execution.”

Interim stage

Even after all these years working on it, the transition to the third generation is not yet complete. “Passing the business from the second to the third generation isn’t an event like a baton pass,” James says. “It’s more of a process.” His father, Harry, still comes the office every day while his uncle, John, checks in frequently while indulging his passion for travel. “They empowered themselves during the transition period to be able to come together and say ‘no’ to something if they feel it is not good for the business,” James explains. “If they feel we are going in a direction they’re not comfortable with, they can come in and talk about it and, if need be, say ‘no.’ With that right in mind, they are comfortable delegating 99.9% of the decisions to us.”

John and Harry try not to get involved in the nitty-gritty of day-to-day decisions. “Harry and I combine 125 years of experience, which has transformed into wisdom,” John observes. “We are more akin to a board of directors, guided by logic. We advise and consent.”

“John and I have to be on the same page to veto something the co-CEOs desire to have,” Harry adds. “The family consultant is a big help if there is a stalemate, but generally we are able to work out the decisions.”

There are other issues still being resolved, and this arrangement won’t last forever, James says. “We know that subsequent generations will need a more formal board of directors,” he acknowledges. “We also had to develop policies for entry into the business by future generations. Cristina and I had to take a leadership role in promoting those.”

James and Cristina have four children between them, ranging in age from 6 to 14. The fourth generation also includes nine other cousins. The key to the work the Marianis are doing today, James says, is “to balance the development of formal management systems with the culture and values we want to maintain as a family business.”

Dave Donelson is a business writer in West Harrison, N.Y., and the author of the Dynamic Manager Guides and Handbooks.

Copyright 2013 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact

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In 1922 Emily Post wrote a bestselling book that defined propriety for the masses and spawned an enterprise that’s now in its fifth generation, putting the lie to historian Laurel Thatcher Ulrich’s maxim that well-behaved women seldom make history. “I think you can change things and still maintain your own ‘civil integrity,’ for lack of a better term,” says Emily’s great-great-granddaughter Anna Post, 33.

Emily’s very proper demeanor comes through in a 1947 black-and-white film, in which she appears just as you would imagine her in her mid-70s: bedecked with a double string of pearls, with a brooch at the neck of her flowery dress. Saccharine violins fade as she launches into a tutorial on proper table manners. “Manners at the most formal dinner party are exactly as they are at home,” she assures today’s YouTube viewers from across the decades.

Emily made history in a big way with Etiquette: In Society, in Business, in Politics and at Home. The book likely resonated among the American public because its author emphasized how people should treat each other, not which fork they should use.

Emily’s great-grandson Peter (Anna’s father) recalls his famous ancestor as “the matronly grandmother, not the famous person. She was very strong-willed, individualistic, an A-type personality. But her greatest asset was her ability to put people at ease even though people were very nervous to meet her. She loved to know what they did. She was a curious individual, quite a delight to be with.”

Emily and her son Ned founded the Emily Post Institute (EPI) in 1946. From offices on the second floor of a former elementary school in Burlington, Vt., the institute updates Emily’s book, now in its 18th edition (subtitled Manners for a New World). It also churns out other books (28 are currently offered on as well as syndicated newspaper and magazine columns that decipher the evolving standards of etiquette for diverse settings and audiences. EPI also conducts seminars on various aspects of etiquette. It trains independent professionals to present its licensed seminars in business and children’s etiquette. Through its website, it sells stationery, photo albums and other products, primarily for weddings.

While today’s rules of etiquette may have changed dramatically since the institute’s founding, the seven Post family members running EPI today say the three pillars of good manners—consideration, honesty and respect—have remained constant.

Becoming a household name

Peter, 62, the managing director of EPI, is as affable and easygoing as Emily was reputed to be. His great-grandmother “took the rules of high society and divulged them to the great middle class,” he says, “and made it possible for Everyman to know what those social customs were.” She did so with compassion, humor and even a touch of drama as she described how to navigate tricky human -interactions.

Born in 1872, the daughter of prominent Baltimore architect Bruce Price, Emily grew up in a well-to-do family; she was a debutante at ease with elite socialites. At age 19 she married Edwin Main Post, a New York banker. He was a philanderer, and the couple eventually divorced. Emily raised their sons, Edwin Jr. and Bruce, on her own and took to writing. Her first book, The Flight of a Moth, written in Europe, was a novel based on letters to her father. Emily wrote four more novels, which dealt with contrasting customs and manners in the U.S. and Europe. When a friend, Vanity Fair editor Frank Crowninshield, suggested she write a non-fiction book about etiquette, she initially had no interest. She considered the topic—even the word itself —to be stuffy and trivial. But she was curious enough to read what was already written. Appalled at how wrong the advice was, Emily agreed to write a short primer. Some 300,000 words later, her first etiquette book was born.

She remained relevant through the Roaring Twenties, the Depression, World War II and beyond, addressing issues of the day in books and columns and over the airwaves. In the 1930s she became one of the first women on radio, presenting weekly broadcasts. During World War II, she addressed issues concerning women in the workplace as well as soldiers. At the height of her success, “the two most powerful women in America were Eleanor Roosevelt and Emily Post,” observed Vanity Fair in a December 2001 profile of Emily.

Her son Edwin (Ned) Post worked with her, mostly behind the scenes. After she passed away in 1960, Ned continued to run the company until 1965, when his son and daughter-in-law, William and Elizabeth, took over.

Third-generation members William and Elizabeth maintained the office in New York City until 1974, when they moved to Vermont. During her more than 30-year tenure, Elizabeth updated the original book multiple times and began branching into new niche markets, such as weddings, entertaining, business and teens. Like his father, William worked primarily behind the scenes, negotiating contracts. After Elizabeth stepped down in 1995, her son Allen’s wife, Peggy, succeeded her. She was soon swamped with the task of helping create the 16th edition of the general Etiquette book; meanwhile, requests for new books focusing on business, weddings and parents began rolling in. She needed help.

Peter, who had been running an advertising agency with his wife, Tricia, for 20 years, says his siblings “pointed a finger at me” and asked him to step in. “I was intrigued, and thought it would be fun to have a career change,” he recalls. He co-wrote the business book with sister-in-law Peggy, took his share of speaking engagements and accepted requests to write columns.

Peter’s sister, Cindy Post Senning, holds master’s and doctoral degrees in education, plus a nursing degree. She has considerable leadership and teaching experience: as an elementary school principal for six years, as a teacher of nurses and, most recently, as clinical director at a home health agency. Watching EPI take on a steep growth curve got her thinking about approaching etiquette from the angle of kids’ social development. With a team of nurses and teachers she outlined six developmental stages from birth through age 16 and began sketching out manners appropriate for each stage. In the late 1990s she left her job to work with Peggy on Emily Post’s The Gift of Good Manners: A Parent’s Guide to Raising Kind, Considerate, Respectful Children (William Morrow, 2002).

EPI’s board of directors consists of Peter and Cindy and their two brothers, Allen (who made his career in finance) and Bill (a lawyer), plus Peggy. Members of the fifth generation are also involved in the thriving company: Peter’s daughters Anna, a spokesperson, author and presenter for EPI, and Lizzie, 29, the institute’s spokesperson and e-learning and video manager; and Cindy’s son Daniel Post Senning, 34, who serves as manager of web development and online content and is also a spokesperson and author.

Several factors have contributed to the company’s growth. First is the need to redefine rules and social customs as society continues to evolve. Second is the family’s ability to follow the values and manners they espouse. Third is EPI’s success in extending its brand. It has embraced new technology to bring its message to diverse audiences through multiple media.

Redefining the rules

People need help figuring out how to behave amid new realities. For instance, what are appropriate ways to interact on social networking or online dating websites? How does the financial downturn affect expectations about re-gifting, gift registries and tipping? Is it acceptable to text or tweet at a business lunch or at the family dinner table?

Although Cindy acknowledges that “manners change every five years or so,” the family defines new rules based on their core values of honesty, respect and consideration. “I do not think our society is ruder than it used to be,” Cindy says. “But we are a more casual, informal, society. And some people equate informality, casualness and rudeness. I do not. You can be informal and still be polite.” EPI offers guidance on achieving that balance.

Because life in the 21st century is so fast-paced, people don’t always make time for relationship building, Cindy says. “A lot of rudeness we see today is not intentional,” she explains. “We’re going so fast we don’t bother to say hello.”

Families who wolf down meals to rush to their various activities are missing the opportunity to practice the social aspects of eating, Cindy laments. “Our kids learn manners and social skills at home, so we have to make time to share meals with our kids,” she says.

Working with family

Peter and his siblings each own 25% of the company. When they were growing up, none of them had been expected to take over. None even spent summers working at EPI. “My parents’ greatest fear was that if we all took over and worked in the business, it would hurt the strong and positive relationship [we] have with each other,” says Peter.

“We agreed if we got to the point of impasse we’d give up the business before we’d give up the family,” Cindy says.

They have been careful to avoid typical family business pitfalls, and to make sure the fifth generation is prepared. “We didn’t want to put our kids in same position, to take over a business we had to learn in our mid-50s,” says Peter. “We wanted to get them involved so they could discover if they were interested, and [provide] some tutoring in the business without having it just drop in their laps.” Another way the company avoids some family business traps is to never let a parent supervise his or her own children.

At a recent presentation at the University of Massachusetts Family Business Center in Amherst, Peter noted that 12% of people who quit their jobs—in family or non-family companies—leave because of incivility. The diversity of today’s workforce can contribute to actual or perceived rudeness, he explained. “When you’re involved with family, it ratchets up that potential,” he said. Resentments can build when family members take each other for granted and don’t bother to express appreciation. Everyone in business should think before acting, recognize that perspective matters and avoid being rude, he said. And he recommended that family business members invest ten times the effort in these areas.

Peter says he tries to run the institute as openly as possible. “The biggest thing, when I took over as managing director a few months ago, was to remove the second-guessing,” he says. For example, he shares the company’s financial records with all staff, family and non-family. He also holds weekly meetings to brief the team on key issues and resolve problems.

Family members are expected to follow basic etiquette at home. But Peter acknowledges there’s always room for improvement.

For instance, recently Anna mentioned that she had become overwhelmed by her spokesperson responsibilities, which involve a lot of travel. “Until she articulated it, we weren’t aware of that,” Peter says. “We all had to sit down together and look at that frustration and how we could try to provide support. It’s important to look at the problem instead of the emotion behind the problem, to see if the frustration is reasonable. But this was a pretty rare occurrence, and there was no screaming or yelling at each other. It’s not as if we put out brush fires all the time.” Once Anna’s predicament was understood, some of her assignments were reallocated among other family members, Peter says.

Working with family members is “incredibly complex,” Anna acknowledges. “While it’s also very rewarding, it’s much harder to compartmentalize your life. You have to get really good at enforcing your boundaries with people you spend Thanksgiving with.”

Family members who work together often avoid discussing uncomfortable issues, Anna notes. The best way to bring up a sensitive topic, she advises, is to take a direct approach. “It’s important to ask in private, without any attitude: ‘I’m curious how you made this decision’ or ‘[I don’t understand] why you said that.’ But you can’t nitpick.”

“Managing that family relationship is harder than I thought it would be,” Cindy acknowledges. “If there was an issue with one of the girls I used to say, ‘Why don’t you just talk to Peter about it?’ That might be difficult because they see him as their father. It wasn’t until my son came [on board] that I appreciated that.”

Spreading the word

The EPI team contributes etiquette columns to Good Housekeeping, The New York Times, USA Weekend, The Boston Globe, and Daniel manages the company’s website, Facebook and Twitter pages and oversees the company’s Q&A blog. He also created Etipedia, an online encyclopedia of etiquette that houses content from all of the institute’s materials, searchable by keyword and organized in sections and subsections that match those in the 18th edition of Etiquette.

>When non-family member Dawn Stanyon, 47, joined EPI in 2005 as a public relations coordinator, the primary income-generating area was book publishing. The institute was presenting four or five seminars a year and had no time to focus on strategy.

“I saw the potential for growth,” says Stanyon, who is now EPI”s director of sales and relationships. “The people and product were there. So I started reaching out to corporations.”

Today, Anna, Peter, Cindy and Stanyon each give 20 to 30 presentations a year. Once a year EPI offers five-day train-the-trainer programs, which cost $5,000 per participant. This year, 15 people attended the business-training program, and four attended the children’s training program. Stanyon also helped develop a professional image-consulting arm.

Although Peter politely declines to give dollar figures, he estimates that all this activity has helped the company’s revenues increase by a factor of five or six since the mid-1990s. Emily Post may not have been able to imagine the concerns and conflicts of the 21st century, or to predict the success of the company today. But there’s little doubt that if she could, she would text or tweet her descendants to offer enthusiastic praise. Just not at the dinner table.

Jayne A. Pearl is a freelance writer, editor and speaker. She is co-author, with Richard A. Morris, of Kids, Wealth, and Consequences (, and of a new e-book, Kids and Money Guide to Shrinking Your Family’s Carbon Footprint (




 Ten ways to build better business relationships

Business Etiquette Behaviors Family Business Application
1. Be on time.



Don’t expect to be given a break because you’re family.



2. Remember to say “Please,” “Thank you” and “You’re welcome.”



Failing to use these simple words when speaking to family members sends a message that you take them for granted. You run the risk of having your request perceived as a demand, or even an expectation.



3. Be prepared.



Even if your name is on the door, do your job as if you are in danger of being fired for poor performance.



4. Be aware you are representing your company in your attire, attitude and efforts.



Don’t use “Mom” or “Uncle” when talking to family members on the job. You should strive to professionalize your role in other people’s eyes rather than infantilizing it.



5. Harness the power of the sincere compliment.



Don’t assume your family members know that you appreciate their efforts. But make sure your praise is genuinely deserved. It’s easy for a family supervisor to err on one extreme or the other.



6. Pay complete attention in meetings.



Your actions at meetings indicate to your family and non-family colleagues that you take you position seriously—or that you don’t. Failure to respect what people say at meetings can hurt morale.



7. Take responsibility for your mistakes. Apologize and offer a solution.



Family members should be as accountable as non-family employees, if not more so. Don’t allow mistakes to build up and feed into any unresolved resentments or negative family dynamics.



8. Recognize that your actions outside of work affect you and your organization.



Even when they’re not at work, family members’ actions reflect on the business, especially if your business carries the family name.



9. Send handwritten thank-you notes for gifts, meals, favors done for you and big opportunities.



Just as with apologies, thank-yous that go unwritten can amplify unresolved issues between family members.



10. Embrace and use the principles of etiquette: Consideration, Respect and Honesty.



The direct route is best when you’re unsure where you stand or don’t understand a decision. It’s important for family leaders to elaborate on how decisions get made so the next generation understands that process. When raising an issue, remember to be considerate, respectful and honest. A poorly worded question can be perceived as rebellious or attacking; a poorly worded answer can seem patronizing.




Source: Emily Post Institute











Copyright 2012 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact









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During their 30-year partnership, Bill Ramsey and Don Nucci were the public faces of Mann Packing Co. Inc., a grower and shipper of fresh-cut vegetable products headquartered in Salinas, Calif. Bill, in charge of growing and harvesting, was known as “the outside guy” and Don, in sales and marketing, as “the inside guy.’” Over the years their official titles changed, but when it came to running the company they were always equal partners. Their identification as co-leaders was so strong that even their children referred to them collectively as “the Dads” when talking about the business.

While drawing on their complementary talents to grow Mann Packing, Bill and Don simultaneously navigated the obstacle course that a two-family partnership can present. Each had four children, and all have worked in the business.

But their plan for a smooth transition to the second generation was tragically upended by two sudden deaths in the Nucci family. With the loss of Don Nucci and his son, Joe, and the retirement of Bill Ramsey, the women in the families emerged as majority shareholders. Earlier this year, Mann Packing was certified as a women-owned-and-operated business. Lorri Koster, Don Nucci’s eldest daughter, was named the new CEO, officially marking the shift in power from “the Dads” to “the Moms.”

Changes and challenges

Mann Packing is accustomed to navigating changes. Once the world’s largest shipper of frozen broccoli, it switched to supplying fresh broccoli after the frozen broccoli market moved to Mexico and the export market went to China. Broccoli is still a mainstay of the business, but today half its revenues come from sales of washed and ready-to-eat packaged vegetables for retail, wholesale and food service marketplaces. The company does not disclose financial details, but Mike Jarrard, president and COO, says that revenues have grown by 60% since 2005. Sales slowed in 2008 but have been rising since 2010 as consumers’ appetites for healthy, convenient foods have increased.

The Ramsey and Nucci families have strong ties to their small, tight-knit hometown. Don was born and raised in Salinas; Bill’s family, farmers from Oklahoma, arrived in the 1930s. Mann Packing has developed long partnerships with local farmers, some spanning 40 years, and many of the company’s 500 employees are the second generation in their families to work for the company.

“This is not an easy industry because nature is the boss,” says Lorri, “but I love that everything we grow and sell is healthy. It affects your consciousness to be associated with fresh, wholesome products.”

Bill and Don didn’t start Mann Packing Company. That honor goes to H.W. Mann, still known as Mr. Mann to the Ramsey and Nucci families. He founded a carrot-packing business in Salinas in 1939 before recognizing greater opportunities in the frozen broccoli market. Mann hired Bill as a full-time employee in 1955; 12 years later, Bill recommended Don, his wife’s first cousin, to be office manager. Mann didn’t have children and needed help in building the business. The three men worked so well together that in 1976 Bill and Don joined Mann as partners in the company.

The turning point for the company came when Bill’s father-in-law, approaching retirement, offered to sell Bill and Don 12 acres of nearby land to build a processing plant. “That was the most significant decision we ever made,” says Bill, 80, chairman emeritus. “We had to make a big capital investment. That sealed our fate; we were going to be partners for a long time.” The plant, which opened in 1982, still serves as the company’s processing facility, although it’s been enlarged five times in the past several years to keep pace with the volume growth in Mann Packing’s business.

Just as the company finished building the plant for packing broccoli, new technology was developed for packing the crop in the field. Mann quickly adapted to the change, but the experience encouraged management to explore other business ventures. In the mid-’80s, the owners of Costa Farms, growers of leaf lettuce in Salinas Valley, approached Mann for help in handling their whole-leaf lettuce business. Thirty years later, the profitable partnership grows and markets 35 different field vegetables.

Costa Farms developed a machine that cut florettes (Mann Packing’s preferred way of spelling florets) from the broccoli crowns. Dave Stildolph, head of Mann’s marketing department in the 1980s, recommended packaging the florettes in sealed bags and calling them “Broccoli Wokly.” Stildolph’s son even wrote a song to promote it, “The Broccoli Wokly Two-Step.” Later, Mann used the same idea to market cauliflower florettes, which the company dubbed Cauliettes. Stildolph’s innovation launched Mann’s expansion into marketing washed and ready-to-eat vegetables. Today the company supplies and distributes packaged fresh vegetables under its Sunny Shores brand.

H.W. Mann died in 1995, and Bill and Don took on substantial debt to buy his one-third share of the company from his estate. As 50-50 owners, Bill and Don reorganized management. They became co-chairs, Bill’s son Dick Ramsey was put in charge of sales, and Joe Nucci headed marketing.

Meanwhile, Mann Packing undertook a new venture. For years, it had been the largest customer of the Sakata Seed Company in Japan, which developed the vegetable broccolini, a cross between broccoli and Chinese broccoli. In 1998, Mann entered into an exclusive agreement with Sakata to grow and market broccolini in the U.S.; the product name is a registered trademark of Mann Packing Company.

“The harvesting business is profitable if you can come up with equipment that makes it advantageous for the growers to do business with you,” says Bill. “Our ability to adapt to changes over the years wasn’t luck. We had to learn how to grow and market products like broccolini and design new equipment ourselves. It wasn’t easy.”

In the late 1990s, the company ran into financial difficulties when it overestimated the market for broccoli and broccolini and found itself with more product than it could sell. Mann’s revenues dipped, putting Bill and Don under pressure in meeting their payments to Mr. Mann’s estate. It took them ten years to pay off the debt.

Planning for succession

In 2001, Don and Bill were ready to step back and give the next generation a bigger role in running the company. Don retired and Joe Nucci, then 36, was named CEO and president. Dick Ramsey replaced his father as head of field operations.

Dick, who was 13 years older than Joe, wasn’t interested in being CEO. “I’m more of an introvert,” reflects Dick, now 60. “I like to do my own thing. Joe had an outgoing personality and a background in marketing. He was the right choice to lead the company.” Today, Dick is co-chair of the board and vice president of field operations for broccoli and broccolini.

Tackling the company’s debts required Joe to trim expenses and start building a professional management team, including hiring the first CFO. “The Dads were used to doing things one way,” says Lorri’s sister, Gina Nucci, 39, director of Healthy Culinary Innovations at the company. “Joe had a lot of drive and business sense. He set up the structure that took the business from a packing business to a professional corporation.”

Bill’s grandsons Bixby and Cody Ramsey were already working full-time in the company, and other third-generation members were soon to follow. Convinced that the families needed outside help in thinking about succession, Joe hired the Carmel Institute for Family Business in Carmel, Calif. Besides working out a succession plan, they set up a family council as a forum for both families. (They never considered having separate forums for each of the two families, but Lorri says that could change down the road as the business grows in size.) “It never occurred to us that we were the kind of family business people we had read about,” muses Bill. “We were familiar with how to run the company, but not with how to bring in the second and third generations from two families.”

“Two-partnership, multigenerational family businesses compound the complexity of a single-family business,” says Steve Lytle, principal of Clearpath Family Advisors in Portland, Ore., whose family’s beverage distribution company merged with another family business to create Columbia Distributing, one of the largest beverage distributors in the country. “Good communication is the key in any organization, but open minds and hearts are critical when two families are involved,” Lytle says.

“I’d be lying if I said that the relationship between the two families was always rainbows and roses,” says Lorri. “Sometimes things weren’t pretty, but we always worked through our differences by being absolutely honest and transparent.” She prefers not to discuss specific disagreements.

Mann Packing did not experience any rivalry for top positions among members of the two families, according to the Nuccis and Ramseys. For one thing, Bill’s children were older and entered the company a decade before Don’s children. Dick Ramsey is approaching retirement now, while Gina Nucci is closer in age to Bill’s grandsons Bixby and Cody. For another, Mann was fortunate that the family members had a range of personality types and interests. The Nuccis like to be out in public serving on committees and attending conferences, while the Ramseys have preferred to work in field operations and sales.

“What often trips up two-family partnerships are turf fights,” says Lytle. “When family members know the roles they’re best suited for, that’s when they can do a great job in managing succession.”

A double tragedy

Just as the business had regained momentum, Joe died of a heart attack while vacationing with his family in 2005. He was 40 years old. His unexpected death rocked the family. “It was a very difficult time,” says Gina. “Lorri wasn’t working in the company then, so Bill and I had to be the strong ones and reassure our customers that the business was carrying on as usual. My dad stepped back in as CEO, but you could see in his eyes that part of him was gone, too.”

Fourteen months later, the family was reeling again when Don died suddenly at age 70 while on vacation. “The two deaths so close together threw everyone for a loop,” says Dick. “We had a multimillion-dollar business and a lot of people who depended on us, and who we depended on. But we regrouped and did what we had to do to keep going. It showed everyone how well the two families worked together.”

The company began a search for a new CEO, but no candidate matched the skills and knowledge of Mike Jarrard, who had worked at the company for 12 years. After working in different areas on the operations side of the business, he was put in charge of Garden Valley, a satellite business that grows stringless sugar snap peas. (Garden Valley is Mann’s only acquisition.) For a non-family member to step into the top leadership position after the tragic deaths of two family CEOs required considerable delicacy, but Jarrard credits the family and the employees for his smooth transition. “The company never missed a beat,” he says. “Joe had prepared a good foundation by adding more professional talent. We all had heavy hearts, but we were committed to keeping the company moving forward. We have a culture of rolling up our sleeves and dealing with whatever confronts us, and we said, ‘OK, we can take this on, too.’”

Don’s daughter Lorri started working full-time at Mann Packing in 1990, but left after a few years to work for an Internet company. When Joe died, she was raising two young sons, working from home and doing some consulting for the family business. She increased her consulting hours to help out her dad. After her father died, she returned to Mann Packing full-time. Her husband, Tom Koster, had been working in sales in the company.

“My dad was a workaholic,” says Lorri. “My husband and I did not want to repeat that mistake. We wanted to be present for our kids, so Tom quit his job and became Mr. Mom.”

As part of his estate planning, Bill Ramsey had been gifting his company shares to his four children. That action, coupled with the distribution of Don and Joe’s shares after their deaths, left the women in the two families with a 64% majority. The company applied for certification as a women’s business enterprise through the Women’s Business Enterprise National Council to give it a competitive edge in bidding on government contracts over some of its biggest, publicly traded competitors. (Many of Mann Packing’s customers, like Wal-Mart, Safeway and Kroger, also have vendor diversity programs.)

To qualify for certification, Lorri became CEO in 2012 and Mike Jarrard—who Lorri says is “like a brother” to her—took the title of president and COO. The company also changed its bylaws to allow it to add outside professional women to the board.

“Gina and I do a lot of media training with our trade association,” says Lorri. “They like to have us because we’re moms marketing to moms. We just got back from a women’s bloggers’ event where the audience of women were ‘high-fiving’ us. They love that we are a women-owned and -operated business and that Gina and I are sisters. It adds a lot of credibility to what we do.”

Lorri has been CEO for less than a year, but she is settling into her leadership position and says it feels right for her to be there. “My being CEO created a sense of stability, security and continuity,” she says. It says to our employees, customers, and growers that the Ramseys and Nuccis are still here and still moving the company forward.”

Nonetheless, she admits that the sudden elevation to CEO under such tragic circumstances was not easy. “I never would have thought in a million years that Joe would die so young and that I’d be where I am today. It’s not that I couldn’t do it, but that I never had to because I had a big brother. My dad assumed he’d pass on the business to his son. Had he been more transparent with me about his thoughts about the company, it would have been easier to become CEO. Instead, I had a baptism by fire.”

Don’s and Joe’s deaths so close together taught the Nuccis and Ramsey families a hard lesson. “We got hit by a truck twice,” says Lorri. “You think it can’t happen, and then it does. That’s why it’s so important for family businesses to have strong executive management teams in place.” And, as a women-owned and operated company, they want to ensure that the women shareholders, in particular, understand the company’s financials and what’s happening in the business. Now Gina, and Bill’s daughter Rebecca Ramsey, regularly attend board meetings as observers.

Lorri is optimistic about the company’s future. She and her management team have developed an ambitious plan for growth by 2014 that includes adding new products and possibly new acquisitions. “This is a good time to be in the food business,” she says. “I’m passionate about this company and our industry. We will stay true to our values and won’t forget where we came from, for sure, but we’re not ‘the Dads’ anymore. We’re much more professional.”

Deanne Stone is a business writer based in Berkeley, Calif.









Copyright 2012 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact

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Closing his fifth-generation family construction business was perhaps the hardest decision Thomas H. Bentley III ever made. He also says it may have been the smartest thing he ever did. “For my son, I was much more likely to create an opportunity for him by looking forward than if I just kept looking back to history,” says Tom, 66. Just a few years after making that tough decision, the Bentleys are preparing for transition to the sixth generation with the same clear-headed, no-nonsense attitude.
Today, Tom and his son Todd, 34, devote their energies to Bentley World-Packaging Ltd., one of the top three export packers east of the Mississippi. Bentley World-Packaging began as stopgap business during World War II and then lay dormant from 1946 until Tom revived it in 1973 as a diversification move during an earlier construction downturn. The company serves more than 300 major manufacturing customers, including General Electric, Westinghouse and Goodyear, and is a major player in packaging of military shipments to Iraq and Afghanistan. 
<B>A legacy of prestige</B>
The Bentley Company was founded in Milwaukee in 1848 &mdash;the year Wisconsin was admitted to the Union&mdash;by John Bentley, an immigrant from Wales who had learned the masonry trade in Middleton, N.Y. The company grew for more than 150 years to become one of the largest contractors in the state, earning a reputation for high-quality construction of historical landmarks like the Villa Louis Mansion in Prairie du Chien, the Music Hall at the University of Wisconsin in Madison and the spectacular Tripoli Shrine Temple in Milwaukee. The company&rsquo;s reputation for building and restoring religious structures spread through word of mouth; by the mid-2000s, about a third of Bentley&rsquo;s projects were churches.
Through its five generations, the company took on notable projects across the country, from the Cincinnati Water Works to the San Francisco Post Office, which survived the earthquakes of 1906 and 1989. The Bentley Company nurtured five generations of Bentleys through the Civil War, two World Wars and the Great Depression. 
But then came the financial collapse of 2008-09. &ldquo;We had over 40 competitors in the commercial construction business in Milwaukee,&rdquo; Tom Bentley explains. &ldquo;Even before the [downturn] in 2008, it wasn&rsquo;t a very good business.&rdquo; Every job attracted a plethora of competitive bids, thus driving down margins. When the downturn came, &ldquo;The business was horrible,&rdquo; Tom says. &ldquo;There were three times as many contractors as there were jobs.&rdquo; 
In early 2008, The Bentley Company started to wind down the construction business. &ldquo;My ancestors would probably roll over in their graves, but at the end of the day you have to do what you have to do,&rdquo; Tom says philosophically. 
In retrospect, Tom says, he&rsquo;s glad that he made the decision to get out of construction just as the downturn gathered steam. &ldquo;I was able to place my people, sell my equipment and [get] rid of my office building,&rdquo; he reflects. &ldquo;A year later, I wouldn&rsquo;t have been able to do any of that.&rdquo; About ten employees &mdash;mostly office and administrative personnel&mdash;transferred to the packaging company, representing 20% of the workforce.
Bentley says he had to sign a personal note to his bank for a million dollars to guarantee completion of all remaining projects, pay all subcontractors and service providers, and repay all loans. &ldquo;I could have just declared bankruptcy, but I live in this town and I was clearly going to do the right thing,&rdquo; he says. He adds that the decision has paid off; the bank has repeatedly offered him financing for other ventures, he notes.
<B>Packing and real estate</B>
Closing the construction company allowed Tom to devote more energy to the packing company, which had been growing nicely since its resurrection in 1973. It began during World War II as a logical extension of the construction business, Tom says: &ldquo;We had carpenters and tools, and the country needed all kinds of crates for the war effort.&rdquo; The company packed Jeeps and other heavy equipment for shipment overseas. 
When the war ended, the company&rsquo;s carpenters went back to work in the surging construction business, and the crating enterprise basically closed down. At the time Tom fired it up again, the company occupied 5,000 square feet of shop space, operated one fork truck and had two men making boxes. Today Bentley World-Packaging has 500 employees, 2 million square feet of space, and so many fork trucks Tom&rsquo;s not sure of the number. Annual revenues are $70 million. Tom holds the title of CEO.
Bentley World-Packaging focuses solely on packaging for overseas shipments. The company is not involved in warehousing, freight forwarding, trucking, ocean shipping, air freight or other aspects of the logistics industry. &ldquo;We do industrial crating to ship machinery overseas,&rdquo; Tom explains. &ldquo;We build wood crates as big as two-car garages that go in ocean shipping containers.&rdquo; 
The company packs shipments that go to 150 countries. &ldquo;We prepare it to get there without damage,&rdquo; Tom says. &ldquo;The counts and packing lists have to be right. The weights and sizes given to the freight forwarder have to be right. It&rsquo;s not as simple as it sounds.&rdquo; Making good on a shipment that arrives damaged in China, or with fewer pieces  than expected, &ldquo;is an unbelievable hassle and expense to our customer,&rdquo; he says.
The company leases most of its space, primarily with an option to buy. &ldquo;We are slowly building an industrial real estate portfolio by carefully exercising those options,&rdquo; Tom says. Today, ten holding companies, under the umbrella of Bentley Management Group, own properties in as many different states. 
Todd Bentley has devoted a good portion of his time with the company managing that portfolio, along with other duties, as he expands his role in preparation for the transition to the sixth generation. For three years after college, he worked for Deloitte &amp; Touche as a management consultant before joining the family company in 2003. &ldquo;Early on, I was split 50-50 between the construction company and the packaging company,&rdquo; Todd says.
Todd says he&rsquo;s more involved in day-to-day operations than his father is. &ldquo;It&rsquo;s different every day,&rdquo; Todd explains. &ldquo;I get everything from proposed acquisitions to major proposals [for] customers. Tom tries to focus on the sales side of the business. The operations and financial matters are my focus.&rdquo;
<B>Planning for the future</B>
Todd was CFO until early 2012, when he became executive vice president. &ldquo;He needs to get away from the numbers and go out and take a well-rounded tour of the company from operations to sales and meet the customers,&rdquo; Tom says. &ldquo;After two years of doing that, the plan is, I&rsquo;ll become chairman of the board and he will move up to CEO.&rdquo;
&ldquo;Every week or month that goes by, I take on more and more,&rdquo; Todd says. &ldquo;Sometimes it&rsquo;s planned, and other times it&rsquo;s just things that need to get done. Officially and unofficially, the transition is happening now. Ownership is being transferred on an ad hoc basis through stock purchases based on appraised value. There is no defined plan at this point, but there is an annual process that takes place.&rdquo;
It all sounds simple, but day-to-day squabbles sometimes get in the way. &ldquo;Like any family, there are days that are really &lsquo;up&rsquo; and days that are challenges,&rdquo; observes Dennis Axelson, chairman of The Bentley Company&rsquo;s four-person advisory council and executive coach to the senior management team. &ldquo;Dads are always harder, in my opinion, on their sons than they are on the independent people working for them. They have higher expectations.&rdquo; Axelson was formerly the executive vice president and CFO for Johnson Financial Group, a subsidiary of SC Johnson and Son, another fifth-generation family business based in Wisconsin. 
&ldquo;Overall, they are doing very well.&rdquo; Axelson says of the Bentleys. &ldquo;They have very open debates,&rdquo; he notes. Tom &ldquo;probably wins 60%&rdquo; of these debates, a percentage to be expected when a father and son argue, he notes. &ldquo;But Todd is very good at articulating his points,&rdquo; Axelson observes.
Todd agrees with that assessment. &ldquo;It was difficult at first because it&rsquo;s hard to differentiate the line between father-son and employer-employee,&rdquo; he says. &ldquo;I&rsquo;m held to a different standard than other employees&mdash;and rightfully so. At the same time, I&rsquo;m probably a little quicker to criticize. Early on, it led to some heartache and strife until I learned when to speak my piece and when to let issues slide.&rdquo;
Todd says of his father, &ldquo;There are areas where he will never delegate,&rdquo; such as sales and marketing. &ldquo;When it gets to the things he doesn&rsquo;t enjoy as much, he doesn&rsquo;t mind.&rdquo; On the other hand, Todd says, &ldquo;I have a lot of authority in terms of pricing, purchasing decisions and matters like that. I sometimes may go to him to keep him in the loop.&rdquo; Todd says he recognizes that he needs his father&rsquo;s blessing on large-scale decisions, &ldquo;but it&rsquo;s not strictly defined.&rdquo;
Tom points out that this transition is vastly different from the one he went through when his father, Thomas H. Bentley Jr., handed him the reins. &ldquo;My father was a pretty passive guy,&rdquo; Tom recalls. &ldquo;He was running a nice firm, working about 40 hours a week, and he was comfortable with that. He wasn&rsquo;t driving very hard. To his credit, he was very relaxed and got to spend a lot of time with his kids.&rdquo; Tom&rsquo;s three younger sisters were not involved in the business.
&ldquo;It made it pretty easy for me to go in there,&rdquo; Tom says. &ldquo;He wasn&rsquo;t very opinionated and he never preached or second-guessed me a whole lot.&rdquo;
In addition, Tom points out, the family enterprise that Todd will lead, and the economic conditions in which it operates, are very different from the business environment in 1983, when he became president of the company. &ldquo;The business is far more challenging than the one I went into,&rdquo; Tom says, &ldquo;so there is more for us to disagree about. It&rsquo;s much more complicated, so you&rsquo;re not going to find yourselves on the same page all the time. Todd and I clearly have to work through more&mdash;and more difficult&mdash;questions than my dad and I ever did.&rdquo;
Axelson says the Bentleys have a big advantage, though. &ldquo;Unlike a lot of executives,&rdquo; Axelson says, &ldquo;they are more than willing to have an independent person like myself step in and help them talk things out.&rdquo;
Among the many questions they&rsquo;re working through is how the company will advance in the years ahead. &ldquo;We real-ly want to grow the packaging business, both organically by helping our customers succeed and by making strategic acquisitions that offer broader geographic options for our customers,&rdquo; Todd says. &ldquo;There are many advantages to offering services in multiple locations.&rdquo;
In the last five years, the Bentleys bought a competitor in Wisconsin as well as a company in Pittsburgh. More recently, they bought another packing company serving Dayton and Cincinnati and another in Baltimore, and Tom says they expect to acquire one or two every year for the near term. 
&ldquo;The typical export packing company is a mom-and-pop affair,&rdquo; Tom explains. &ldquo;It will have 40 or 50 customers with a million and half in sales and 15 employees. We have advantages in purchasing and contacts as well as expertise in military shipping, so we&rsquo;re on the acquisition trail. Many of the owners are nearing retirement age, don&rsquo;t have sons or daughters in the business, and see nothing but bad news in the headlines every day. It&rsquo;s usually an easy meeting for me.&rdquo;
Now may be a good time to be a buyer, but that&rsquo;s at least partly because the packing business is soft. As U.S. troops are withdrawn from Afghanistan, military shipments will decrease. That&rsquo;s coming at a time when softness in the economies of Europe and China is reducing demand for exports to those markets as well. Tom is keeping a wary eye on international developments. &ldquo;Let&rsquo;s hope the world&rsquo;s economy doesn&rsquo;t collapse,&rdquo; he says. &ldquo;A trade war and high tariffs would be disastrous.&rdquo;
Todd, as befits the next generation, takes a longer view. &ldquo;Our plan is to continue to grow the way we have, expanding our role as the market leader in our industry,&rdquo; he says. &ldquo;We intend to keep it a family-owned company.&rdquo;            
<I><B>Dave Donelson</B> is a business writer in West Harrison, N.Y., and the author of</I> The Dynamic Manager Guides and Handbooks.
Copyright 2012 by <i>Family Business</i> Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact <a href=""></a>.
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Learn from an author’s experience


Leaving a Legacy: Navigating Family Business Succession

By David C. Bentall

Castle Quay Books, 2012; 336 pp., $34.95

David Bentall was once the heir apparent at The Bentall Group, a Western Canadian enterprise whose businesses included construction, engineering, leasing and property management, and industrial parks and shopping centers. By 1988, the company had a $500 million portfolio of assets and five regional offices; it was voted one of the 100 best companies to work for in Canada.

Then the wheels fell off. Around the time that David Bentall turned 33, long-simmering tensions erupted among his father and uncles, the second-generation owners of the business. Ultimately, the family enterprise was divided; David’s father, Clark, purchased the construction operation, Dominion Construction Co. Ltd., and Clark’s younger brother Bob assumed control of the real estate and development side of the business. In the process, David Bentall was ousted from his role as vice president of The Bentall Group.

Clark Bentall never reconciled with Bob or his elder brother, Howard. “It was tragic to watch as our family, once characterized by mutual respect, deteriorated into a fractured wasteland of broken relationships,” David Bentall writes in Leaving a Legacy. But by acquiring Dominion, Clark’s branch of the family “were given a second chance at getting succession right,” the author states.

David Bentall describes in his new book how he and his third-generation siblings developed ownership and governance structures that guided them as co-owners of Dominion, where he served as president and CEO for seven years. Later, a sister and her husband bought out David and another sister, thus ending the author’s involvement with his family business.

In the book, Bentall, now a family business adviser and executive coach, candidly shares his family’s story—what they did wrong and what they did right—to illustrate key points about family business best practices.

The author explains that his grandfather, Charles Bentall, had named Clark as president of the family business and Bob as the vice president while recovering from a heart attack at age 69. Howard, Charles’s eldest son, was a minister and did not work in the family business; nonetheless, all three sons were given equal ownership shares. Though he had stepped down from leadership of the company, Charles Bentall lived for another 20 years, his grandson notes. “If Granddad had been able to anticipate some of the challenges that lay ahead,” David Bentall writes, “he might have used this time to help his boys develop agreement on a shared vision for the future.”

The three brothers had no model of collaborative leadership and no procedures for breaking deadlocks. Other factors contributed to the tensions, as well, Bentall notes. The company’s board existed only on paper, with no formal meetings and no independent members.

Bentall explains that his uncle Bob was “forced to be subordinate to my dad for 20 years,” and his uncle Howard, who didn’t work in the business, “felt out of the loop.”

“Sadly,” the author reflects, “my dad was unaware of how much his brothers were struggling and how deeply rooted these feelings were. In fact, he was naïve to the fact that he contributed greatly to their angst…. Had they realized the need to invest in family communications and long-term family harmony, they might have been able to avoid the further deterioration in relationships that ensued.”

A non-family executive relentlessly teased Bob, but Clark never told him to stop, David Bentall writes. “The fact that he didn’t likely undermined Bob’s faith in Dad’s leadership,” the author points out.

The story of The Bentall Group’s breakup is painful to read. Though David Bentall, unfortunately, doesn’t offer any other family members’ perspectives, he is objective in describing what went wrong, and why.

In the 1970s, after a couple of ownership reorganizations (one of which occurred purely for tax-planning purposes), Clark owned slightly less than 32%, Howard and Bob owned 25.01% each. “For the next decade, no one paid any attention to the fact that they now had effective control of the company,” David Bentall notes.

In the mid-’70s, Clark Bentall became non-executive chair, and Bob was named president and CEO. But Clark continued to act as if he were the company’s ultimate authority. “As president and CEO, Bob had tried for almost ten years to obtain Dad’s support for the creation of a shared vision and a strategic plan for the future,” Bentall writes. “However, Dad was unable to adapt to this new way of approaching business.”

Bentall explains that Bob wanted formal job descriptions that outlined clear lines of authority. “Dad, the entrepreneur, didn’t like to be constrained by such practices, which he viewed as a waste of time and energy.”

The author frankly explains his father’s role in the succession debacle, yet throughout the book he describes his dad with love, respect and pride. “I loved my dad for many reasons, but his commitment to acting in a principled way—even in the midst of pain and betrayal—was truly inspiring,” David Bentall writes. “He was a man of principle and always sought to take the high road.”

Bentall unflinchingly describes his own contribution to the rift between the brothers. “Unfortunately, once I joined the company, I often disagreed with [Bob’s] business strategy (and almost everything else),” David Bentall writes. “Instead of respecting his experience and his senior position in the company, I was openly critical of him (both to his face and behind his back). I now realize that my critical spirit and insubordination combined to give my uncle ample justification to eventually want to remove me from the company.”

The situation came to a head when Bob and Clark disagreed over the appointment of a new vice president of real estate. Bob, Howard and a non-family executive who owned some stock transferred their shares into a holding company that would own 68% of the family enterprise. A facilitator who had a vested interest in the outcome convened separate meetings with the family branches that culminated in the splitoff of the flagship construction company, Dominion Construction.

Bob and Howard were not interested in discussing the sale of Dominion “as brothers”; they told Clark to hire a lawyer and accountant and make a formal offer. This prompted Clark to convene a meeting of his wife, his children and the children’s spouses. “To add tension to the situation, none of us had ever been included in discussions of this nature or magnitude before,” David Bentall notes.

“As a family, we didn’t have either appropriate structures or fair processes,” the author states. “Nor did we have a road map for developing as good owners. We were actually offered no training or orientation at all. However, having seen G2 fail badly in their relationships as co-owners, our generation worked hard to do things differently.”

Bentall’s book details the negotiations and planning that led to his successful third-generation partnership with two of his three siblings between 1988 and 1998. During that decade, according to the author, the company’s annual sales grew from $150 million to slightly less than $300 million; the business was profitable most years.

Bentall also discusses his quest for a meaningful career after he left Dominion. His book is replete with references to his hobbies, faith, philanthropic activities and relationships with his wife and children.

In Leaving a Legacy, the author cites the work of several noted family business advisers and researchers; he also offers insights from some of his clients. In one section of the book, he provides samples of several key governance documents, including a family constitution (from Carlo Inc., a fifth-generation real estate company based in Albuquerque), a family employment policy (from an anonymous family), an agenda for an initial family meeting and a director recruitment strategy. A separate section consists of short profiles of 23 business families.

Readers can learn a great deal from the Bentall family’s experience, shared so eloquently and generously by a family member who was present on the front line. “[I]n our family’s experience,” David Bentall notes, “matters became much worse simply because we were afraid to talk about them.”








Finding the courage to walk away


Trapped in the Family Business:
A Practical Guide to Uncovering and Managing This Hidden Dilemma

By Michael A. Klein

MK Insights LLC, 2012; 119 pp., $22

If you’re unhappily employed in your family company, you’re not alone. Author Michael Klein notes in this slim, easily readable volume that while financial “golden handcuffs” can keep an executive from leaving a company, family business members often feel constrained by “emotional handcuffs” related to guilt, obligation or loyalty.

Klein, a Massachusetts consultant who holds a doctorate in clinical psychology, notes in his introduction that he conducted “over 30 interviews with family business members, consultants and writers” while researching the book. He quotes from many of these interviews throughout the text, though he doesn’t name the family members he queried.

The author stresses that most of his interviewees reported feeling emotionally trapped. “Interestingly,” he writes, “very few mentioned anything about being financially trapped, despite the massive downturn in the global economy.”

The first part of the book provides insight into how this situation develops and reassurance that it is widespread. Klein points out that many entrepreneurs start businesses with the goal of passing them on to their children. He cleverly likens such “arranged occupations” to arranged marriages.

Sometimes pride keeps a family member yoked to the business, Klein notes. Family employees soldier on to prove to relatives that they can do the job, or out of fear that the business might fare very nicely without them.

Inertia is a common factor. Why deal with the anxiety of a job search when one can simply stay put? “Incredibly, for some, there can even be great comfort in family business quarrels and disagreements if this is what is most familiar,” psychologist Klein explains.

The book’s later chapters address what to do once the problem has been identified. This is what anyone drawn to a book titled Trapped in the Family Business hopes to find. Klein acknowledges that this part of his book is open-ended. “The goal of this section is not to provide a systematic guide for what to do for every situation,” he writes. “Rather, it is to create a very broad set of options to consider what might be possible.”

The author bluntly lists a trapped family member’s three alternatives: Change your perspective on the job, change the job itself, or exit. All three involve frank discussions with others.

Klein advocates consulting an objective third party before broaching the subject with family members. When making your case to relatives, he advises, “be very clear about what you hope to accomplish through such a conversation and have an idea of how to start it and how to end it.”

The book doesn’t serve up a ready-made solution, but it can help guide your thinking on how you might escape your trap.







Copyright 2012 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact

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Connolly Brothers Inc., a fourth-generation construction management company noted at one time for the quality of its masonry work, has endured like one of the stone walls that track across the countryside near its headquarters in Beverly, Mass. What has kept the company in business for more than a century and a quarter?

“The secret is the struggle against adversity,” says 91-year-old Stephen Connolly III, father of the current owner and grandson of one of the company’s founding brothers.

Each of the four generations that have owned and managed the firm responded to adversity—world wars, depressions and collapsing real estate markets—not only by working harder, but also by changing direction as often as necessary to keep the company afloat. “Real estate and construction has provided a good livelihood for us, but it’s tough,” says Stephen J. Connolly IV, 63—known as Steve —who is the company’s CEO and current owner. “It’s cyclical, and a lot of people can find themselves overleveraged. You wake up and you’re gone.”

At one time, Connolly Brothers had 500 workers slinging sledgehammers and shaping land with steam-driven graders all over the Eastern seaboard. Today it employs 35 people, who use computers to design sleek office interiors and manage dozens of specialized subcontractors working on commercial projects close to home. The business certainly isn’t risk-free, but it made it through the recent financial crisis and the subsequent freeze on new construction. That was just another period of adversity that has marked the company’s history.

The Gilded Age … and then a tarnished economy

In 1848, 20-year-old Stephen Connelly sailed from Ireland to Boston and landed a job as a gardener on the estate of the Lyman family, where his brother, Thomas, tutored the owner’s children. Stephen married and eventually moved his wife and five children to Beverly, where he became superintendent of one Massachusetts Bay’s North Shore estates. Two of his sons, Stephen J. and Greg, landed a contract for road building near their home in 1884. Their eldest brother, Thomas, joined the firm two years later. The fourth brother, Michael, and their sister, Mary, weren’t active in the business. All three men worked at other jobs on the side as they got their company started at the turn of the century.

Although they tackled a range of projects, the brothers specialized in masonry work. As time passed, they became contractors of choice for the elite families of America’s Gilded Age, working on grand mansions from Kennebunkport, Maine, to New York’s Hudson Valley, Long Island, and even as far south as Virginia. Top architects of the day like Frederick Law Olmsted, the designer of New York’s Central Park, prepared the plans for projects the Connolly boys undertook. They did stonework at the restoration of Colonial Williamsburg, a project backed by another of their clients, John D. Rockefeller Jr.

“They had a pretty good company most of the time,” Steve Connolly says, “although they almost bankrupted themselves a couple of times, too.”

By the end of their first year in business, the brothers had begun buying land, an activity that would continue throughout the company’s history. One particularly lucrative acquisition was 400 acres of farmland in Topsfield, Mass., which eventually became the source of gravel for railroad track ballast—much of it going to build Boston’s North Station. When the gravel and stone ran out, the property was sold.

From the World War I through the Great Depression and into World War II, the company struggled to survive. Its interests—and management attention—were scattered among hard-to-find construction jobs, heavy equipment sales and rental, quarrying and property management. As the economy floundered, the owners looked for opportunities throughout the Northeast. Leadership fell to Greg Connolly, Stephen J. Connolly’s eldest son and a World War I veteran.

“When my grandfather came back from the war and joined the company,” Steve Connolly explains, “there was [company] stock scattered all over the place and a bunch of family members supposedly working for the company and getting a paycheck every week, but they weren’t doing much of anything. My grandfather spent most of his life buying out these little bits and pieces of stock.” He consolidated ownership through a series of incorporations, buyouts and swapping of assets until the current company was formed. At that point, it was owned solely by his branch of the family.

Greg’s son, Stephen Connolly III, first worked for the company as a summer laborer in 1937, earning five cents an hour less than the lowest-paid hired hand. He remembers the tough times they faced. “At one point, in a matter of a few days,” he says, “a tremendous number of contracts were canceled due to the economy. During the war, it didn’t get better because the company was entirely a residential contractor and they weren’t building new homes. Also, no labor or materials were available.” While he served in World War II, the company survived primarily by doing work for General Electric and Eastman Gelatin (a division of Eastman Kodak).

Stephen Connolly III and his brother, Peter, bought out their sister when their father died. Later, Stephen III bought out Peter. “When it later became apparent that my uncle’s son wasn’t interested in the business,” Steve Connolly explains, “my father bought out his brother to become the first person to be sole owner of the company.”

A streamlined company

Steve Connolly, who had spent three summers working for the company, began a full-time job there in 1967. He worked in the office for six months before going into the Navy, where he served until 1971. “It took me two days to drive home from South Carolina,” he recalls, “but the next morning, my dad woke me up early and said, ‘You’ve been screwing around long enough. It’s time to go to work.’” Steve bought the company from his father in 1989 and began making changes almost immediately in response to conditions in the marketplace.

“We stopped doing residential work and also stopped bidding work on the open market,” Steve says. “A few years before that, I had started doing more in-house design-build construction management business.”

At the time of the transition, the company had about 175 employees, most of them laborers and tradesmen. “Now we have some equipment and have superintendents on the jobs, but we use subcontractors mostly,” Steve explains. There are about 35 employees today, with more people in the office than in the field. Annual revenues vary greatly; the company expects to generate $30 million this year.

These days, Connolly Brothers typically has ten to 12 projects of various sizes under way at any given time. They’re commercial and industrial projects with a bit of institutional work, but nothing for the public sector.

“With the public bid laws, the mentality of the project managers, estimators and superintendents is contrary to the way we want to run our business,” Steve explains. “You can have 25 bidders on a project with extensive plans, but the only way to make money on the job is through changes and change orders and fighting and scraping your way through the whole thing.”

All of the firm’s work is done in the Boston suburbs (work in the city usually requires union crews) for a limited number of clients who bring the company back again and again. On a dollar volume basis, Steve estimates that 70% of revenue comes from repeat customers. IRA Motor Group, a chain of auto dealerships, has contracted for some 25 projects ranging from completely new facilities to major renovations over the years. One recently announced project is construction of a 32,000-sq. ft. manor house resembling a mansion originally belonging to William Loeb that burned down in 1987. The new building will contain offices for a Boston-based holding company, Affiliated Managers Group. Connolly Brothers worked on the original building when it was erected in the 1920s.

In 2008, Connolly Brothers completed a 12-phase interior renovation for MITRE Corporation. Connolly was able to completely gut a 130,000-sq.-ft. building; replace all mechanical, electrical, and fire protection systems; and refinish all interiors including dry wall, flooring, cabinetry, ceiling, and painting without disrupting the client’s personnel—who continued to work in the building during the construction.

“The nature of the business has changed quite a lot,” Steve says. “When the economy was lousy, my dad would go back to the basics. Today, with the way the world has changed, that’s a fatal strategy. You have to be changing all the time.”

The rate of change seems to be accelerating, too. “In 2009, our business was way off—we did a third of what we’d done the year before,” Steve says. “We did a little bit more than that in 2010. But things picked up significantly and we did as much work in the first four months of 2011 as we did all of [2010]. The economy hasn’t picked up that much, but many of our clients had put off projects until they got to the point to where they needed to move. It’s still not as robust as it was in 2007-08.”

Planning for transition

One of the next priorities for Connolly Brothers involves training the fifth generation. Steve’s son, Jay, 27, is a project manager at the company with responsibility for several multimillion-dollar projects. (Steve’s daughter, Page, 31, is a property manager in Washington, D.C., and is not expected to join the family company.)

“I grew up in and around the business visiting job sites every weekend with my dad,” says Jay. “Hopping into excavators and backhoes is quite a thrill for a little kid. I still slip into the driver’s seat for a few minutes sometimes when visiting a project site.”

“I knew my son wanted to go to work for me, but I encouraged him to do something else every summer,” Steve explains. “When he was in his senior year, I suggested he talk to various companies to see what he might want to do. He came to me in the late spring and said he wanted to work for me.”

An office building the company constructed for its own real estate portfolio was in the final stages of planning when Jay graduated from Boston College. “It was a good opportunity for me to get into a project from start to finish,” he recalls. He attended permitting meetings and worked in the field as an assistant superintendent. He also worked in the office, shadowing the project manager. “I was hiring laborers that summer,” Jay says. “Hiring construction laborers isn’t exactly like interviewing investment bankers, but you’re dealing with someone’s career. At the same time, when the economy went south, I had to lay people off, too. That’s definitely the hardest thing I’ve had to do. I think my dad had me do some of those things so I would gain the experience.”

The Connolly family has made many such difficult decisions over the last century and a quarter, managing through boom and bust economies by continually redefining their company’s mission.

Dave Donelson is a business journalist and the author of the Dynamic Manager Guides and Handbooks.

Copyright 2012 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact


David Packard and Bill Hewlett, two engineering grads from Stanford University, founded Hewlett Packard, the IT giant, in Packard’s garage in 1938. They flipped a coin to see whose name would go first. Packard won the toss, but both decided that Hewlett Packard had a stronger ring than Packard Hewlett. That brand, and the partnership it represents, is now a household name worldwide.

Hewlett and Packard, knowing well each other’s competencies, chose each other as partners. They were playful in their choice to flip a coin and displayed a remarkable lack of ego in making one of their first significant decisions. And, of course, they had the all-important entrepreneurial DNA.

HP didn’t become a family business; it grew into a complex corporate structure after going public in 1957. Most family firms evolve within one family line. In partnerships, by contrast, either one partner’s family buys out the other or the company goes public or is sold. And yet currently in my consulting practice, I am working with three unique companies, founded by partners who chose each other, now in the process of succession planning to stakeholders in two or three families. Is this a trigger for sale, or can successors from more than one family work together as partners?

Partnerships are precarious: They require enormous trust, complementary talents, a shared vision—and a sense of humor. Some endure for decades; others crash into red ink or nasty litigation. When partners who chose each other transmit ownership to their heirs, the complementary talents, the trust and the shared vision may be missing ingredients. How do heirs who become partners (without a decision of their own) build a partnership?

Succession planning in a family business is arduous under the best of conditions. But what if there are two families, each transmitting 50% ownership of a significant asset to their heirs? Can successors raised in different households with different levels of education, values, work ethics—and, perhaps, percentages of ownership —become productive partners?

If you never got to choose your partners, building a partnership will require more time and energy and grit than the “easy” path that biological families face. Partnered families may end up working more like corporations than their family business neighbors do. Consider the requirements of any successful partnership and use them to determine whether the new partners have what it takes:

1. Define the vision and goals for the company. Long-term dreams for the company are best written down after comprehensive retreats during which members mark common ground and build a shared plan for the future. Since the average life of most companies is about 25 years, each generation must reinvent the company. If this can’t be done, perhaps one family should make an offer the other can’t refuse.

2. Develop a strategic plan for the company, in collaboration with key managers. Where will the company be in five years? What is your vision for 2020? What will be required to reach those goals in terms of investments and personnel? What metrics will be used to define success? Who is committed to the plan and the reinvestment it will require? Lack of agreement on the plan provides another signal that someone should opt out.

3. Reverse-engineer job descriptions for current key executives, based in part on real-time observations of their functions (logs of activity over a month’s time). How much time and energy are devoted to strategic thinking? Key relationships? Quality control? Routine tasks? What changes will be required for these executives to take the company to the next level? Do they each have a No. 2 who can step up in a crisis? Do family successors have growth plans to prepare them for leadership? If the talent is unevenly distributed between the families, consider a buyout.

4. Define the competencies that are needed to take the company to the next level, and determine where to find that talent. In a company that is owned by more than one family, professional standards for hiring become crucial. Objective inventories can measure competencies, 360-degree assessments can indicate who works well with others and on-the-job track records demonstrate performance. Provide enough education to increase the odds of success, but recognize that outside talent may need to be hired, even though both families may still retain ownership of the company. If the shareholding families are not willing to identify or hire strong professional talent, consider a buyout.

5. Reach an agreement about who will have the opportunity to own stock. Succession planning happens not only in management, but also in ownership. How stock is divided among successors determines who will have control. Are the original partners willing to share plans, wills or trust agreements for transmitting stock to their heirs? Consider offering family members who qualify for management the opportunity to earn enough stock to gain control. With appropriate legal advice, consider setting up voting and non-voting shares. If one of the families doesn’t have members who are competent or motivated to make complex business decisions as owners, or qualify for management, consider a buyout.

6. Develop conflict management skills. Fear of conflict may be a greater problem in closely held businesses than conflict itself. Conflict management is a skill set that isn’t usually taught in school, but it can be learned. By developing clear agreements for working through conflict, usually with the help of a professional facilitator, partners can learn to make collaborative and creative decisions together. If conflict remains persistent and disruptive, ask the troublemaker to leave, or consider a buyout.

7. Develop the right rhythm of communication among partners. Some partners meet monthly to review financials and solve problems. Partners in smaller firms may meet once a week, perhaps for lunch offsite; others meet quarterly as members of the board of directors. Shareholders’ meetings, which provide information about the company and offer an opportunity for informed discussion, may be held annually. E-mails should be reserved for sharing facts and information, not emotional issues. If communication remains sparse or secretive, even after appropriate training in conflict management, consider a buyout.

8. Write a partnership agreement. Robert Frost wrote, “Good fences make good neighbors”; likewise, good guidelines make good partners. Some issues to consider: How will partners’ compensation be determined? What percent of profits will be reinvested in the company? What kinds of information will the partners share (A pending divorce? Bankruptcy? Other partnerships they are involved in?) How will the buy-sell agreement be structured? How will disputes be settled? Who has responsibility and authority for which decisions? Whose favorite charities are supported? What kinds of exit plans and retirement goals are shared? If there are more disagreements than agreements, consider a buyout.

9. Build a board of directors or advisers. When there are multiple owners, structures for governance become essential. Some boards include the partners or representatives elected by each family, as well as business leaders from non-competing companies that are one step ahead of the partners’ firm. Two or three competent advisers can provide objectivity, expertise and fresh ideas. If there is no willingness to accept accountability to a well-functioning board, revisit the buyout option.

10. Do more of the things required to grow any successful business. Competent people, clear policies, effective systems, a strong balance sheet, a culture that values innovation and a strategy tailored to profitable markets—all the components that build any successful company will allow a partnership to grow, regardless of the origin of the shareholders. If all this is good, enjoy owning and managing a profitable company with partners you never chose.

Amway is one surprising example of a successful business partnership that has weathered the succession process. Founded in 1959 by Rich DeVos and Jay Van Andel, the company is now run by Chairman Steve Van Andel, Jay’s eldest son, and President Doug DeVos, Rich’s youngest son. In 2010 the company generated revenues of $9.2 billion in worldwide operations.

Amway’s success has not been accidental. The company’s website ( clearly indicates that the concept of partnership permeates its business culture: “Amway is built on the concept of partnership between our founders. The partnership that exists among the founding families, employees, and business owners is our most prized possession. We always try to do what is in the long term best interest of our partners, in a manner that increases trust and confidence.”

All partnerships involve work

Remember that in second- and third-generation family businesses, heirs don’t get to choose their partners either. Some siblings or cousins may contribute mightily to the business; others may demonstrate that “pruning the family tree” is a necessity. Family businesses that become multigenerational partnerships require extraordinary courage, time, energy and talent. Even if bolstered by DNA, the bonds of family heritage or the founders’ dreams, no company evolves successfully without a clear vision and the hard work of making partnership a reality.

Ellen Frankenberg, Ph.D., ABPP, based in Cincinnati, works with succession planning and family business partnerships (

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