Busi­ness lives in his blood

Many fam­ily busi­nesses don’t sur­vive

The Guardian (Charlottetown) - - BUSINESS - Joe Sher­ren Joseph Sher­ren, CSP, HoF, Fel­lowGSF, In­ter­na­tional Busi­ness Trans­for­ma­tion Spe­cial­ist. Call 902-437-6998, or check our web­site www.gate­waylead­er­ship.com

Ac­cord­ing to Forbes Mag­a­zine, less than one third of fam­ily busi­nesses sur­vive the tran­si­tion from first to sec­ond gen­er­a­tion own­er­ship. An­other 50 per cent do not sur­vive the tran­si­tion from sec­ond to third gen­er­a­tion. That means only 12 per cent of fam­ily owned busi­nesses make it to the third gen­er­a­tion.

There are many rea­sons for this. Of the 70 per cent of busi­nesses that fail to tran­si­tion, 60 per cent of those fail due to prob­lems with com­mu­ni­ca­tions and trust. An­other 25 per cent fail due to in­com­pe­tent lead­er­ship skills - they are not prop­erly coached. It is ex­tremely cru­cial for a fam­ily busi­ness to en­gage in suc­ces­sion plan­ning and en­sure the next gen­er­a­tion is prop­erly pre­pared to take over.

Brad MacLen­nan of Re­li­able Motors in Char­lot­te­town is adamant about de­fy­ing those odds: He is the third gen­er­a­tion in the au­to­mo­tive busi­ness. His grand­fa­ther, Arnold, pur­chased a Pon­tiac deal­er­ship in Summerside in 1954, then opened MacLen­nan Motors in Char­lot­te­town in 1973. Arnold sold it to Brad’s un­cle, Charley. Charley’s son Kurt now owns the Toy­ota Deal­er­ship in Char­lot­te­town. Brad’s fa­ther, Brent, started Re­li­able Motors 1980, where Brad is the gen­eral man­ager.

So, it seems the au­to­mo­tive busi­ness runs deep in the MacLen­nan blood.

Ini­tially, Brad was not in­ter­ested in the fam­ily busi­ness. He tried work­ing in other in­dus­tries, trav­el­ling ex­ten­sively, and be­came a li­censed car­pen­ter. He then at­tended Ge­or­gian Col­lege in On­tario, where he en­rolled in au­to­mo­tive mar­ket­ing and went to work with MacIver Dodge in New­mar­ket, Ont.

Dur­ing this time, Brent was pa­tient and un­der­stood that it was im­por­tant for Brad to find his pas­sion. Even­tu­ally, Brad suc­cumbed to the call­ing of the fam­ily busi­ness and came back to work with his fa­ther. He took over as Gen­eral Man­ager, ini­tially learn­ing about lead­er­ship from the school of hard knocks.

He at­tributes his suc­cess to the great staff and strong man­age­ment team at Re­li­able. As well, he took much of his fa­ther’s ad­vice that in­cluded - re­main hum­ble, lis­ten to your peo­ple, and fol­low your in­tu­ition.

Brad also en­gaged a busi­ness coach to get an out­side per­spec­tive, to sup­ple­ment his learn­ing about lead­er­ship, and to un­der­stand his own strengths and de­vel­op­ment needs.

He also dis­cov­ered that: “It’s not about know­ing what you want in life, it’s about get­ting a di­ver­sity of ex­pe­ri­ence to know what you don’t want”.

Brent will re­main as Prin­ci­pal for a few years, so Brad will have more op­por­tu­nity to learn from his wis­dom and get a few years more ex­pe­ri­ence be­fore tak­ing over. He’s on a mis­sion to defy the odds and con­tinue the fam­ily busi­ness.

And this is good; there are many ben­e­fits to both the com­mu­nity and the econ­omy for a fam­ily-owned busi­ness to suc­ceed. Ac­cord­ing to a Busi­ness Week ar­ti­cle, fam­ily com­pa­nies of­ten out­per­form non-fam­ily com­pa­nies for the fol­low­ing rea­sons:

The fam­ily is more com­mit­ted to long-term per­sonal de­vel­op­ment, train­ing, and re­ten­tion of their staff and man­age­ment team.

Fam­ily mem­bers who col­lab­o­rate can re­act more quickly than large im­per­sonal bu­reau­cra­cies when the busi­ness en­vi­ron­ment changes or crises hap­pen.

Fam­ily com­pa­nies of­ten achieve stronger em­ployee loy­alty which will re­duce turnover and in­crease pro­duc­tiv­ity.

They rein­vest a higher per­cent­age of prof­its in the com­pany to en­sure long-term suc­cess.

The fam­ily has an emo­tional, as well as fi­nan­cial, stake in see­ing the busi­ness suc­ceed.

My ques­tion for busi­ness own­ers: Do you have a suc­ces­sion plan in place that will en­sure the next gen­er­a­tion will suc­ceed?

Newspapers in English

Newspapers from Canada

© PressReader. All rights reserved.