I have a confession to make: Change makes me uncomfortable. Doing things in a new way involves extra effort and inevitable mistakes, and I mourn the time that’s wasted during the learning curve. But if I’d never learned to embrace change, where would I be today? Sitting at a typewriter waiting for the correction fluid to dry? I prefer progress, thank you very much.
For some family business owners, change isn’t merely uncomfortable; it seems like a betrayal of their ancestors. Great-grandpa put a lot of sweat into inventing his product, and selling it enabled the family to prosper. But when Great-grandpa’s business model becomes obsolete, it’s time for the family to move on. The important element to be perpetuated is your founder’s entrepreneurial spirit and values, not the wares on the shelves.
In this issue, we profile two business families who recognized the need to adapt. The R.D. Merrill Co., founded in the 1890s as a timber business, now generates most of its revenue by operating senior housing communities. The 91-year-old Flottman Company, rooted in the commercial printing industry, still provides printing services but has expanded its customer base and developed digital marketing expertise.
Marketplace shifts tend to occur gradually, so it’s important to continually monitor the competitive landscape. Unfortunately, this is where a lot of family businesses—especially the smaller ones—slip up. Key executives are so overwhelmed with day-to-day operations—and, often, with maintaining harmony among fractious family stakeholders—that they put strategic planning on the back burner. A SWOT analysis (an in-depth assessment of a company’s strengths, weaknesses, opportunities and threats) isn’t just a business-book cliché; it’s absolutely essential if you want your grandchildren to inherit a thriving enterprise. Stories abound of straggling third- or fourth-generation companies acquired by nimble competitors.
Some CEOs pledge to take on the role of strategic planner when they retire. Once they are freed from the myriad responsibilities of working in the business, they reason, they’ll have time to focus on working on the business.
Indeed, a retired patriarch or matriarch can play an essential role in getting the strategic planning process started and ensuring that planning sessions take place on a regular basis. But don’t neglect your next-generation members in this crucial effort. They are likely more attuned to up-and-coming trends and technologies and may be able to sense the direction in which the market is headed. Consider inviting them to join your strategic planning team. Your company’s next great idea may arise out of their passions.
Copyright 2012 by Family Business Magazine. This article may not be posted online or reproduced in any form, including photocopy, without permssion from the publisher. For reprint information, contact bwenger@familybusinessmagazine.com.