May/June 2015

In this issue

  • Preparing to transition your business to a leader from outside the family

    Many of the obstacles that families face in passing their business to the next generation relate to the inextricable connection between "hard" and "soft" issues. The key to navigating these issues is flexibility.

    Rather than "keeping everything in the family,"an increasing number of families are transitioning from managers to owners of their company as a part of a successful succession plan. Ownership, however, entails unique responsibilities and a different skill set than the one used in managing a business.

    Outfitting Nashvilleans for 160 years

    Levy's Clothier for Men & Women in Nashville, Tenn., has been run by the Levy family for 160 years. Zadoc Levy, who emigrated from Germany, opened a tailor shop in 1855, "pretty close to where the honkytonks are now," says fifth-generation owner David Levy, 59.

    The store was passed on to Zadoc's son, Raphael Z. Levy; then on to his two sons, Herbert Z. (David's grandfather) and Alfred Levy; and then to David's father, Ralph Z. Levy Sr., along with A.J. Levy Jr., David's cousin.

    Seventh-generation salt makers start anew

    Many venerable family businesses falter because later-generation members lack the founder's entrepreneurial spark. That's not the case with Nancy Bruns and Lewis Payne, a brother and sister who are seventh-generation members of the family that owns Dickinson Company LLC. Dickinson's business activities include natural resource management, commercial real estate and investments.

    Family internships: Building engagement

    Georgia Mae Parrish grew up spending a lot of time with her grandparents at Lundberg Family Farms, a rice grower in Richvale, Calif. As a fourth-generation member of the Lundberg family, she attended family meetings and heard about the business.

    But when she began an internship at the company in the summer of 2013, she realized that "I didn't know as much as I thought I did about growing rice."

    A planning guide for transforming your company's board of directors

    An effective board of directors that is strategic and productive can help to significantly strengthen not just your business, but also your family. In our work, we find an increasing number of families are recognizing the potential benefits of board development—the process of formalizing their board, with the goal of deriving greater benefit from their governance efforts. This includes the addition of independent directors.

    Evolution of a family business board

  • Beyond 'cohesion': Why terminology must evolve through the generations

    Families experience significant and sometimes difficult changes over the years as elders pass on and new family members grow into leadership roles. Amid such transitions, doing things the way they've always been done can be a recipe for disaster. What worked for a two-generation family with five members may not work when the family reaches the fourth generation and now involves multiple households, varying wealth structures, different liquidity needs and geographical separation.

  • Liquidity drives options in financial planning for a generational transition

    Transitions require capital and renewed commitment to the business. A generational transition can force difficult decisions. Many owners dream of keeping their business in the family, yet this becomes increasingly difficult over time. Ownership stakes become dispersed among family members whose priorities are heavily influenced by their age and involvement in the business. Older members approaching retirement typically prefer high dividends, while the younger generation might want to reinvest for long-term growth.

  • Transitions East 2015 report

    Family business owners and stakeholders gathered at the Grand Hyatt Tampa Bay in Tampa, Fla., for Transitions East 2015, the 10th conference in the Transitions series of family-to-family educational events. Transitions East 2015, held March 25-27, drew 265 participants, representing 85 family enterprises. Two-thirds of the attendees were first-time Transitions conference participants. The theme of Transitions East 2015 was "Family Values and the Valuable Family Business."

  • At the Helm: Mark Baiada

    Generation of family ownership: Founder generation.

    Company revenues: Approximately $1 billion.

    Number of employees: About 3,000 office employees and 20,000 field employees (RNs, LPNs, home health aides, physical therapists, occupational therapists, social workers and speech language pathologists).

    Years with the company: Forty.

    First job at this company: I founded the company in 1975, at age 27.

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