communications management at DeGroote.
Even in established family businesses, that
successor may not always be a family member.
After George Lucus, president of Capitol
Tunneling in Columbus, Ohio, was diagnosed
with prostate cancer in 1999, he named as his
successor a non-family member with a key
position in the business, and appointed his
oldest son, Kyle, vice president and CEO.
George had expected Kyle to take over eventually, but at 27 he wasn’t quite ready.
“After Dad died in 2000, business-wise
things went smoothly,” says Costco member
Kyle Lucus, who five years later became president. “I had worked with all our construction
crews and knew the field operations, but I had
not yet earned the respect of our customers.”
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Third, put it in writing
A succession plan should be written and
should include job descriptions, says Eugene
Muscat, director of the Carl and Berta Gellert
Foundation Family Business Center at the
University of San Francisco.
Once the jobs have been described in
writing, Muscat recommends job rotation so
that members of the next generation know
each other’s responsibilities.
Job descriptions also help when the business owner returns to work. “If everyone in a
business is a jack-of-all-trades, and the one
who rotates into the owner’s job doesn’t have
a job description, then he or she may have no
job to return to,” Muscat warns.
Fourth, communicate
Have in place a list of customers, suppliers
and others who need to be informed of a sudden change in leadership and sent a “message
of stability” as soon as possible, says Andrew
D. Keyt, executive director of the Loyola
University Chicago Family Business Center.
For those who take over, the owner should
have in writing a short summary of his or her
business strategies.
“You don’t need a 50-page treatise, just
enough to give people a general understanding
of the business’s strengths and weaknesses, and
the opportunities and threats the company
faces, especially if the CEO is gone,” Keyt says.
Joe Perrino learned about the importance
of planning from events following his father’s
death. As company president he has organized
his finances and slowly tutored the next generation of leaders.
“When I had bypass surgery in 2005,
there wasn’t a mass panic,” Perrino says.
“Everyone felt very good about what would
happen if a transition had to take place.” C
Janice Rosenberg, a Costco member, is a
Chicago-based freelance writer specializing
in business and health-care topics.
Her articles have appeared in national
and local publications.
