Keeping it all together
With each generation, new challenges
My great-grandfather Titus Schmid, the founder of Crescent Electric Supply Company, emphasized that people were the lifeblood of the company — not just its employees and customers, but all stakeholders in the communities it serves. His efforts in bringing Crescent to life and steering it through wars and downturns laid the foundation for a multigenerational family business.
Crescent has come a long way from its inception in East Dubuque, Iowa, in the early 20th century. Today, it serves electrical supply customers nationwide and has remained family-owned as the Schmids have expanded to five generations.
Titus’s role as a founding entrepreneur was entirely different from that of descendant shareholders like me. Since his time at the helm, each subsequent generation has had unique challenges to overcome and, so far, each has stepped up to the plate.
From my vantage point in the fourth generation, Titus’s entrepreneurial zeal can sometimes feel like ancient history. Maintaining that connective entrepreneurial tissue as the family expands across the country is the challenge we on the family council now face, and it’s not always easy. Formalized governance and strong in-law contributions have been key pillars for keeping the family and business relationship humming, but come with their own thorny issues.
Balancing formality and fun on the family council
When I first joined our council, I assumed that the company had given the third generation (3Gs) a clear roadmap for establishing bylaws, processes and whatever else they needed to get it up and running.
I quickly learned that no such map existed — it instead took significant work from founding council members like Kathy Munson and Mary Daugherty to get it off the ground. Mary is a professor who studies family businesses, and her determination to form a council to facilitate family-business relations was a crucial catalyst behind its creation. Without her urging, who knows what the council would look like today, or if there would even be one.
Maintaining formal governance in a fun environment is a balancing act we on the council are constantly monitoring. We try to not take ourselves too seriously while pushing the envelope on making things better for the family. And we’ve been busy lately — initiatives like a new online document storage and communications platform, an employee assistance fund and life-stage education materials show that we’re not satisfied with the status quo.
In my role as chair of the education committee, the greatest challenge I face is getting other 4Gs (and, as they get older, 5Gs) involved. An educated and active family shareholder base is a harbinger of our future success, but it’s hard to overcome time and physical distances. Prior generations of Schmids had Crescent interwoven into their daily lives — most were concentrated in the Midwest, near family members who worked at the company. Today, most 4Gs live far away from Dubuque and have little day-to-day interaction with the company or each other.
To strengthen the link between us, we’ve set up 4G gatherings via Zoom to catch up with each other and ask questions in a supportive environment. We’re continuing to bolster education materials that help all shareholders learn about the history of Crescent and how the company operates today. Participation in the remote gatherings is lower than where we’d like it to be, so we’re trying new approaches like an Instagram account to connect with younger cousins.
All told, a formal governance structure via the family council and proactive initiatives have helped us maintain solid family harmony. Ensuring that the entrepreneurial fire keeps burning with subsequent generations will be a challenge, but I believe we have the structures in place to make it happen.
In-laws are one of our greatest assets
Thank goodness for our in-laws. They’ve been an incredible asset to our family.
Currently, our three family board members are all in-laws, as are many members of our family council. As the family grows, by definition there will be more in-law shareholders, and I’m looking forward to the talent we’ll be bringing in.
In our council charter, we state that our governance is based on principles, not personalities. This has given way to a meritocracy where well-qualified, motivated individuals are welcomed with open arms, regardless of blood relation or in-law status. While there are many capable cousins in our ranks, input from in-laws has been vital to the success of the council and business alike.
I’m getting married next year and am excited to welcome my fiancée into our family. But at times, it’s been overwhelming for her. Discussions around finances, introductions to dozens of cousins, and learning our governance structure is a lot to digest. There are many things I wish I’d done differently in order to make her feel more comfortable amongst our big family. In particular, I should’ve been more aware of the overwhelm she was understandably feeling.
Empathizing with her concerns has given me a view from the outside, and I’m increasing my efforts around in-law onboarding within the education committee to make the process smoother. Sacrificing future in-law contributions because of an overwhelming onboarding process isn’t an option.
As my younger cousins start to marry, their spouses will likely face similar challenges. Listening to experiences from in-laws and course-correcting as necessary will help us ensure their valuable contributions continue.
Keeping it all together
My great-grandfather built an electrical supply business from scratch. His children worked to keep it alive and growing. His grandchildren grew it further, and formalized family and business relations.
Now, we 4Gs are tasked with keeping it all together. As more and more 3Gs reach retirement age, it’s time for us to take on our unique challenge of maintaining connections with each other and to Titus’s original mission.
It’s not going to be perfect, so relying on our shared entrepreneurship will be key moving forward.
Charlie Rhomberg is a freelannce writer based in Iowa.