Future Leaders are Eager to be Tested
Some say power is seized, not given. I believe potential successors grow by taking risks and seizing opportunities
Many potential successors complain they are not being given enough authority in the business, that employees regard them skeptically as “the Little Prince” or “Snow White,” and suppliers and customers don't take their word.
Every time I hear this litany of complaints, I am reminded of a former student of mine who dropped out of one of my courses because, evidently, he wasn't satisfied with what he was learning. When I encountered him one day on campus and asked why he hadn't brought his complaints to me, he said: “I don't bitch, I transfer.”
Successors who constantly complain they are not moving ahead fast enough, who feel blocked or frustrated in the family business, might consider transferring to Exxon, IBM, General Motors, or some other professionally managed company where their talents might be more fully appreciated. But dropping out is hardly the best solution for those who are truly committed to the family business. In fact, it may be a sign that the successor has not yet been able to earn the trust of management or the confidence of the employees in his or her leadership ability.
How can sons and daughters of successful business owners demonstrate, to themselves and others, that they have what it takes to lead the company?
Obviously, such things as educational degrees, years of managerial experience outside the business, completion of training programs in the family company—all the usual prescriptions—are important. They provide the skills necessary to take advantage of opportunities. But leadership requires initiative, which perhaps can't be taught.
Some years ago a young woman called me for advice on succession in her family's business. Her family couldn't afford to send her to my seminar, she said, but she lived nearby and wondered if I'd meet with her.
I agreed and over breakfast she explained that she and her three brothers worked in a small construction company founded by her father, specializing in excavation and earth moving. She felt that she was the best qualified of the siblings to run the company but was not sure her Old World father and her brothers would accept that. Would I be willing to meet the family?
She was a sweet, ambitious, and tough kid. I convinced the father that she could do it. He put her in charge and laid down the law to his sons, who were no slouches; one was mayor of the small town they lived in.
The daughter became president of a $1 million company with 14 employees. Now, 10 years later, the business has 135 employees and has just closed the books on a $40 million year. This young woman had never seen the inside of a college, but she had the vision and drive to grow the company.
Not many parents would take chances like that on raw talent. I have always said that if my father had been in charge of the U.S. Navy during World War II, he surely would never have given command of a Navy ship to a 21-year-old Lieutenant who shaved only twice a week. To earn the respect of my crew I had to prove my leadership abilities day by day on the open sea.
Many young men and women of my generation rose to the challenge of leadership by proving their mettle in a world war. In a family business, successors can grow in self-confidence more gradually and incrementally, by assuming ever larger responsibilities, by taking risks, and by being eager to be tested and measured.
Too many successors, however, prefer to play it safe. They expect to be handed their authority on a silver platter. I recall one son who called me for advice on how to cope with his father, who he said was a bully. The family was in a tough business—providing security guards to companies—and the 43-year-old son was afraid to confront the father, a former cop, who constantly criticized him.
The successor who waits for permission to lead, who needs advice on how to “cope,” will ultimately be disappointed. I don't believe in confrontation, though it may sometimes be necessary. What I do advocate is constructive dialogue. And I do believe that opportunities must be seized.
Does your company need someone to open up a new sales territory? Develop a new product line? Organize a work team? Potential successors who take on those jobs—and succeed at them—show entrepreneurial drive and the capacity to get things done. Moreover, their own confidence grows. A line management position. may frequently offer more opportunities to demonstrate decision-making capabilities than a staff job. Try it! Be responsible.
The “SDPF” buttons I given clients remind them of my suggestion to “Solve Dad's Problem First.” That bit of advice is not meant to provide Dad with successors who are toadies. On the contrary. A parent without problems offers no one an opportunity. Many fathers have problems a 25-year-old may not understand—work problems, retirement problems, family problems, estate problems. Successors who love and respect their parents will help them solve these problems, not add to them. This is how to build trust in your competence and relationship.
Does Dad have to take two weeks off to go to Arizona with Mom to care for her arthritis? Will Dad feel comfortable if Son says he can take charge of the company? Son says he can and, while Dad is gone, the company doesn't blow up. If Dad has to leave the office for a meeting and a big order has to go out that afternoon, can Daughter take care of it? Yes, and the customer is impressed. So is Dad.
The would-be successor will inspire confidence by identifying new areas of growth for the company and learning what's necessary to lead the company into them. But the successor must make sure to develop skills that are needed by the company. You can be the greatest fly fisherman in the world but your knowledge is irrelevant in a company that digs tunnels.
As a successor you are on a staircase to the top, and everyone in the company is watching. You have to ascend one step at a time, all the while showing genuine understanding and responsibility for the needs and aspirations of the company's non-family managers and other key employees. Looking toward your ultimate role, you have to be responsible for your own future. You must accelerate your own growth and expend the energies needed to take the company to new heights.
If you do that, you will win loyal followers who feel secure about their company's future, and about you as their leader.
Léon Danco is the founder of the Center for Family Business in Cleveland and the author of four books on family business.