The Next Generation of a Family Business
Guest Contributor: Tim Crockett, Partner at Crockett Engineering Consulting.
Stepping Out from the Shadow of your Father
Leading a family business can be a tricky venture. At some point you have stepped into a situation where you are now leading a business that was once led by someone else in your family. There are certain expectations by some on how you should run things, expectations that you will run things exactly as previous members of your family have run them. Basically there is a certain degree of understanding that you will do things the same old way. Procedures, processes, and company culture, to name a few, will remain exactly the same.
Don’t fall into the trap of “We do things this way because this is how things have always been done.” You are your own person with unique talents and abilities. You need to capitalize on these attributes to run the company your way. Just because “this is how things have always been done” doesn’t mean that they can’t, and shouldn’t, change.
Many times business owners, especially owners of a family business, repel the idea of change. They don’t want to do things different because of several reasons. Nobody wants to let their parents down, especially if it means causing the family business to crumble. The best way to run the business isn’t the old way but rather your way. You need to step out from the shadow of your parents and lead the company the way that fits your leadership style.
Sure the safety net of the old way will allow things to chug along as normal… for a while anyway. But what happens when the economy takes a turn (for the good or bad)? Will you be ready to react? Will the “old way” reward you for your hard work? Will you be able to expand and keep up with the changing times? Probably not. It is likely that the tried and true way your father ran his business was very conservative and free of risks, fear and change. He recognized he was working towards retirement and his way of running a business was based on protecting what he had and not focusing on growth and opportunity. Later in his career he was focused on retirement and not expanding the business.
Now with you in control of the leadership reins you need to run the business in a manner that will allow you to react to the changing times; that will allow you to advance the business forward and not sit back and play defense and take only what the market gives you. There are a few principals that I have learned over the years that I consider instrumental to the success of my business once I stopped playing defense and shifted to an aggressive offense mindset.
The best way to run the business isn’t the old way but rather your way. - Tim Crockett
Now that you are in control and make the decisions you need to take risks. I’m not saying be negligent and foolish, but you need to take calculated risks. Look for opportunities and see how you can expand your business to capitalize on these opportunities. Your clients and the market will only give you so much. You need to be aggressive and take command of your future. In the ten years since I have taken over the business from my father I have added entire divisions and departments to my company, I have even added entire companies that complements the one I inherited. Adding these businesses and departments has caused me to take extremely large risks. If not done right I would fail. However the upside was huge. By executing on these ventures I have been able to increase revenues by over 500% in a relatively short time while adding new clients AND providing new service lines to existing clients. Growing up in the family business I constantly saw the competition take the risks my father chose not to take. I am now the one taking the risks and enjoying the rewards of those decisions. The biggest risk of all is not taking risks at all.
Don’t be controlled by your fears. Learn to conquer them. The fears that you have are due to things taking place outside of your comfort zone. Learn to push to new limits. Each time you do you will expand your comfort zone and reduce the fear zone. If you allow fear to control the way you run your business you will never grow, change, or capitalize on opportunity. While my father was a great engineer he had a fear of crossing his pain line. Every time he approached his pain line he would follow it with a rapid retreat out of fear. I have learned that every time you approach the pain line you need to advance over it thus pushing it out further and further in front of you. Each time you conquer a fear it makes you and your business that much stronger.
Everything around us is changing. From the way we communicate, to the way we live, to the way we do business, everything is changing. To be competitive and to keep an edge on the competition you must not only change but you need to embrace it. For years I was reluctant to change. When I would finally give in and allow change to take place I was always behind the competition. I had no competitive edge as I was always behind the curve playing catch-up. I was reluctantly changing, being forced into change, against my will and desires I would slowly change. All the while scratching my head and wondering why my competition always had a leg up on me. Then I started embracing change. I made change a core value and something that my company would strive to achieve. We quickly went from lagging behind the competition to being an industry leader. Embracing change has changed a lot for my business. It has changed our revenues, our profits, our culture, almost everything has changed due to simply embracing change.
Running a family business can seem like a complex venture. On top of the day to day concerns of dealing with employees and working with clients, you have the stress of making sure that you do things right in the eyes of those who owned the business before you. Take some of the stress out of it. Don’t worry what they think. Since taking control of my family business about 10 years ago I have changed about everything and every way my father did business. I took it from a 5 person operation focusing on one discipline in central Missouri to a staff of nearly 40 providing services in 6 different fields and being licensed in 30 states. I have taken risks and was able to confront my fears. I embraced the changes needed to make this happen. Today when I talk with my father about what all has taken place he just smiles and nods in approval.
A special thanks to Tim Crockett, Partner at Crockett Engineering Consultants, for contributing this guest blog. To learn more about Tim’s experience as an entrepreneur, listen to episode 3 of Better Than Before with Tony Richards.