It’s All Relative: Stepping in at Family Firms

A Special Series from NAWLA

The circumstances that lead people to the wood products profession range from the ironic to the serendipitous but, in my case, I like to say the industry ganged up on me! My father worked in plywood operations for his whole career, my grandfather’s forté was logging and sawmilling, and my great-grandfather was a logger as well. I even married into a family of “wood people.” Thoughts of becoming a teacher and football coach faded in the shadow of an industry that had always been part of my life and seemed destined to shape my future.

Over the course of 43 years, my path took me from production work in the mill to the business side of operations and, ultimately, to senior leadership roles. In addition to starting and running some companies of my own for about 10 of those years, my experience has included coming into a family-owned firm from the outside—including at Timber Products Co., where I currently serve as CEO. Although taking over the helm of a family business can be daunting, it actually represents a rich opportunity for “change agents” who are excited about spearheading an operation’s rise to the next level.

On the Outside Looking In

Being recruited externally for a top job at a family-run outfit offers the chance to bring fresh perspective to a business that wants to move in a new direction or equip itself with skill sets it lacks at a given moment. That desire to build and grow into a better company is what attracted me to Timber Products, a 100-year-old company with a fifth-generation family member working in the business.

The call for new leadership came at a time when I was considering retirement, but the pull to help set a new platform for the future at this firm was too strong to resist. The Gonyea family’s commitment to supporting an outside team was critical to my decision to consider the opportunity, and that—along with a few other key considerations—is something that anyone in a similar situation should take time to scrutinize.

Due Diligence of the Company

1. Support: Having 100% backing from the family is crucial if you want to come in and successfully navigate their company to a better place. That support isn’t limited to just the relatives who are active in the business on a day-to-day basis, however. It also extends to family members who hold ownership in the company but are not responsible for day-to-day operation of the business. The Gonyea family, with whom I had interacted professionally and personally for decades, gave me complete assurance that they were both ready to do things differently and prepared to cede control of that mission to an outsider who has the pertinent expertise and who also is the right fit for them.
2. Values: You will also want to take a hard look at the corporate culture beyond the ownership level. Is the staff one that clings to the past and is resistant to change? Everybody needs to commit to a direction if you’re going to go down a new road together.
3. Expectations: Part of the process includes getting a crystal-clear picture of the company’s goals and expectations for itself. Again, alignment is key—is everyone on the same page?
4. Authority: Another major question mark is the real authority parameters associated with the new role. The title of CEO will mean little if you’re unable to act without getting approval from the family for every single move you make. Timber Products made it clear that while the board of advisors and ownership board wanted to be kept informed of all strategic decisions and to have the leg room to make recommendations and otherwise be involved, the company would be mine to lead and operate. Obviously, as with any business, no one has carte blanche to just do whatever they want; but knowing, or laying, the ground rules is essential.

Winning Over the Workers

After accepting a leadership position at a business that has been family owned and operated, probably the best advice anyone could give is to get out in front of the change that is coming. That means providing communication and clarity surrounding where the company is trying to go, how initiatives are going to roll out, who reports to whom, who has authority, and all the other aspects that will concern the existing team.

It also means explaining not just what’s going to change but why and also how that change will affect each of them as individual contributors to the company. It’s imperative to reach out to as many people in the organization as soon as possible and in a variety of ways so that you can to let them know who you are, why you’re there, and what you think. In turn, you can make a connection with the personnel and start working immediately on the concerns of those who may not be convinced about the new journey the company and its employees are about to take.

How you deliver those communications matters, too. Assuming an executive role at a family-owned business where you are not a relative really isn’t much different from doing the same at a public company. Whether there are five partners who are family members or 5,000 individuals who are shareholders, the job of managing the firm and providing leadership is essentially the same. It’s just that the dynamics are different because it’s a much smaller group.

In light of that, you have to have the temperament to understand and deal with the reality that it is a family and that they’ve got their circles of connection to the company—inside and out—and be respectful of that. It takes a different type of communication style to work with a family business. It’s not unusual for employees to form a deep attachment to the owners and to look at the company as a “family.” In fact, the company is a team, and that distinction is critical in making changes. External executives often introduce a more corporate perspective, and that can cause heartburn for longtime staff who are accustomed to doing things a certain way. Instead of taking the resistance personally or getting frustrated, scenarios like this can turn into good communication opportunities.

Leaving Your Imprint

It’s also important to be both mindful and respectful of the fact that as a new, non-related leader, you often are replacing a family icon. Suppliers and customers—any of the people you do business with—know that individual personally and had a relationship with him or her that is now on the brink of change. You must be careful, then, to ensure that what you become is truly a complement to what was done historically, even as you bring your own experiences, knowledge and vision to the table.

That being said, you still have to BE YOURSELF. There’s a balancing act that must be achieved as part of this process. On one side, you have to remain humble in light of the past leadership and operational style. On the other, you must possess the confidence in knowing what needs to be done for improvement and communicating that effectively to personnel so that they can get behind you and your plan.