Wanted: A Change in Founder Mindset Part 2

By Prof. Enrique Soriano

In a virtual memorial service to honor the passing of George, the founder of a 50 year old family business, Gina started the eulogy by expressing her gratitude to his mentor-father and this was her exact words, “Dad was deeply loved by his family, friends and colleagues and we can’t put into words the loss that will be felt by his passing. He knew this day would come and he prepared all of us. And for that, we are eternally grateful.” Another sibling, George Jr. said, “those of us who had the opportunity to work under him also feel a tremendous loss. He was an extraordinarily talented entrepreneur who built a company that still represents and practices the same principles he used to create our brand half a century ago. His exceptional work ethic, long term commitment to his clients and suppliers, unwavering desire to always do the right thing and his belief that his executives were integral to both his personal and the company’s success made him truly one of a kind. As his son and subordinate, I have always been so proud to say I worked for our founder. That will remain a statement which I will be immensely proud of for the rest of my life,”

I also heard James, one of the family’s closest advisors and a member of the Board of Directors when he spoke and reflected on the founder’s succession covenant with the children. James was actually the one that highly endorsed my team in working on the family’s governance journey after he heard me deliver a talk in Boston many years ago. He glowingly shared how the offspring didn’t just slid into their positions because of their last names. “I remembered Gina telling me something about a conversation she and George had right after she completed her MBA.  In one of their many formal and informal chats, George had told Gina that although he was proud of her scholastic achievements, there wouldn’t be a job waiting for her after graduation. He had intimated to her that she needed to excel first in a company where her last name didn’t guarantee job security. And if she achieved that goal by way of promotions and merit increases within a certain period of time, George would talk to her about joining the company—but only if Gina expressed firm commitment and passion. Gina told me that she was hurt by her father’s remarks at the time. When I sent an email to George about her daughter’s feelings, he immediately called me and in a curt voice, he said, Gina and her siblings must prove themselves first.

Over the years, George’s wisdom had become clearer to the family members. Gina eventually proved her worth as a key manager of a major company and when she joined the family business, her track record kept employees from thinking that she was there only because of her birthright.  Eight years after her graduation, Gina told me that she and her siblings realized that her father was right all these years and thanked George for being their beacon of light. James added in closing, “I can truthfully say that George was not just the beacon but our true north. My friend masterfully painted a picture for all of us to think beyond ourselves. A principled, honest, and brilliant tactician that carefully planned this successful transition up to the very specific end. George will surely be missed.”

I got goosebumps after hearing all their adulations honoring the man that never wavered despite navigating a complex journey of putting the entire ecosystem (family, business and ownership) in order. Now that the die has been cast, we can expect a smooth transition essential to maintain the confidence of investors, business partners, customers and employees. This will also provide Gina and her siblings with a solid platform from which to move the company forward.

To be continued…