Family Business and Tough Love, Something to Be Grateful For

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I’m the middle kid in my family. I have an older sister who is much prettier than I and a younger brother, who was a dream come true for my father, who always wanted to have a boy to carry on the family name, so it’s no wonder that I’ve always been the rebel, the troublemaker in the family. I suppose that I just wanted attention, but I also had a strong desire to live my life my way.

Growing up with a strong-minded entrepreneur who had a very clear idea in his mind about what was best not only for the company but for every single member of his family was not easy for me. I imagine that dealing with a strong-minded child was not easy for him, either.

My father’s biggest loves in his life are his kids and his business, so he has always tried to keep us together. We started working in the family business as children helping out on the weekends. Later, as teenagers, we rotated through different positions giving holidays to employees and working part-time during college managing one of the service areas of the company.

I loved it. I hated it. I loved the learning, the responsibility, and feeling useful and proud of my family. I hated the lack of freedom, feeling that I did not have a say in what I wanted, and how demanding and difficult to please may father could be.

When we had arguments, my father would end the discussion with, “You don’t understand how much a parent loves a child until you have one.” I think I understand now that I’m also a parent.

My father asked us to take on jobs such as waiting tables, pumping gasoline, and cleaning cars. His expectation that we would work as hard in the business as he did was his way of loving us and teaching us the value of money, appreciation for what we had, humility, and respect for other people regardless of their background. Our successful company was not a present; it was the result of hard work and dedication.

My father did not make things easy for me. I had to fight hard for want I wanted. This was also his way of loving me. He just wanted to protect me, but his strong desire to control my life was my biggest motivation to be brave, follow my instincts, and not settle for less than what I wanted.

Today is Thanksgiving, and I have many things to be grateful for: my family, my husband, my kids, my friends, my wonderful life… But what I have to be the most grateful for is growing up in a family business with a strong father who cared deeply about me. Thanks to him and to all the good and bad moments we have gone through, I am who I am and I have the life I have today. I couldn’t be more grateful for that!

Thanks, Dad, for being the wonderful father you are. I love you.

Happy thanksgiving to everybody!

Written by Carmen Lence, Family Business Consultant and coach

www.nextgenfamilybusiness.com

When is a Good Time to Pass The Baton… to Your Brother? Burnout Time!

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Kirk McMillan is now CEO/Owner @ VIS3

 

Second-generation Kirk McMillan successfully grew his family’s U.S. company, Twelve Baskets, from $4 million to $50 million annual revenue. Then his brother was invited by his father to join in and decision-making became “complicated.” Learn from someone who has come out through the tunnel of frustration, lack of support, and ultimately burnout and who learned how to survive and thrive.

-You assumed the leadership of your family business right after finishing university. What were the circumstances around it?

I was a senior in college and I was about to start interviewing. I was home for the holidays. After dinner, I was at the dinner table and my parents asked me, “Would you be interested in coming to work for the family? We need help.” And I thought about it, I was like, ok. I’d been working in the business, I had done all the little things you do growing up in a family business. Then I came in and there wasn’t a formal process to say: Here’s how the business runs…I just had to jump in and figure it out as I went along.

– When did you become CEO of the company?

Within four years. I started out without a title. Then I was there for four years and my dad and mom made me the president of the organization but I was already acting in that role without having the title. Because I was already doing the strategies, already putting things in place that needed to be done to change the company.

-How did it feel not to have a job description when you joined in?

I didn’t have an official one so… the people looked at me from a leadership perspective. But my dad looked at me as a son, he didn’t look at me as someone like a partner. I don’t really even know if he looked at me as an employee either, he just looked at me as a son. And so when we would have meetings with employees, suppliers, and customers that dynamic was not working because he was treating me like a son in all of these meetings. So I told him, “Dad you can’t continue to treat me as a son, if this is going to work, you have to start looking at me as part of the organization, as an owner, as a leader of it.” But that didn’t change; he kept doing it so I had to find a way to change it up. So I stopped calling him Dad. In those meetings I started calling him by his first name. And that was a shock for him. But eventually he did change—it took him a little while but he did. The funny part was that it immediately made a difference with the employees, the customers, and the suppliers. They looked at me differently. I call it system shock—I had to shock the system to make it change.

– What were the main challenges in taking over the presidency so young?

I was 26 at the time. The challenges were more strategic challenges because where I was taking the business was strategically different than where my dad was comfortable. So the challenge was trying to marry the risk that is involved with the strategies and getting the family on board with that. So that was difficult whereas my dad and mom didn’t take much risk before. But we had to take more risks to survive, to grow the business. We couldn’t do all the things that I wanted to do because there had to be some synergy between the family and the business.

-And then you grew your family business from $4 million a year to $50 million. What in your opinion has been the key to your success?

Well first, the system shock.  Continuing to challenge the business and the employees to do something differently than what they are used to. That was the biggest key, keeping people on edge to grow the business.

Having the buy-in from people collectively as a group was another big key, getting everybody together to move forward. And finally, looking further out time wise. We would look five years out or ten years out and not try to get caught up in what’s happening today to where you’re just reacting to the world that’s happening around you. That was a big culture shift for our business because my dad is a very reactive person. He’s happy when he goes home and he’s put out ten fires during the day.

Another challenge was keeping people motivated and energized, getting them where they are happy coming in to work wanting to do the things that were important.

-How did you feel when your father offered your younger brother a position with the company without asking for your input first?

At first I was angry, it was sort of taken as disrespectful, a lack of recognition for not only the position and work I was doing, but lack of recognition and respect for our relationship. That was my initial reaction to that. But then I asked myself, “Is this a family business?” and I really had to sit back and say, “All right, this is a family business and this may be best for us.” It doesn’t matter so much how I feel about it, I can make the most of this situation and make it as positive as possible.

-In 2007 your company got a very good offer from a competitor to get bought out and your family didn’t accept the offer. That was the first time that you didn’t feel you were in a family business—why?

It’s a big step for the family to say yes, we want to entertain an offer from another company, so you are basically saying that we are willing to give up what we built. And then as we got further into the negotiations, my brother, I, my parents, everybody had individual motivations to sell and they weren’t collective. It wasn’t where everyone was getting together and saying all right, what’s best for the family. That’s when I realized, Is this really a family business? And if it doesn’t feel like a family business maybe I really need to look at doing something else. And I was already feeling this way personally from other aspects because I was losing energy. I was burned out. I had been president of the organization for thirteen years but really running the business for fifteen years. I couldn’t convince my family to get a board of directors so I didn’t have a support network. I didn’t have any support systems where I could get honest feedback.

When I was running the business early on and up until when my brother got there, ultimately I was making decisions as president of the organization and I didn’t really seek my dad’s buy-in on those decisions. I just did what I thought was best and if my dad didn’t like them we would just end up fighting about it some but for the most part he ended up coming along on those decisions. When my brother came in things shifted and it became more of a democracy where decisions weren’t getting made. So I was really getting burned out. My dad and brother would be in alignment and I would be the outsider trying to do things. The business wasn’t moving forward, I wasn’t able to convince them to do things that I thought needed to be done. So now this offer comes in, we agreed to talk to this company and then all the personal motivations started to come out—what people are looking for. I said this just doesn’t seem like a family business. The motivations don’t really seem like we’re looking out for the family long term.

– After 15 years leading the company you decide to pass the baton to your younger brother. How did it feel?

It was a five-year process. It was two years of this very emotional cycle. The self-evaluation of what did I like about the business? What did I dislike? What did I get out of it personally? What were the challenges? What were my successes? What were my failures? Why would I want to stay? Why would I want to go? In that two-year process I just kept evaluating and at the end I realized that it was best for me to leave. For personal growth, for personal reasons that I needed to do something else. So at the end of the two years is when I told my parents; I didn’t talk to them before that period of time. Once I made the decision there was peace. I was happy with it. From that point on whatever I needed to do to help the transition I was willing to do. So my brother and I took on a co-president role for a year but ultimately he was making a lot of the decisions. I took on the CFO role during his first year as president and a year later, I stepped away from the business, realizing that my brother needed me to be away for him to be able to grow. He needed that autonomy to not have anybody to blame and only he himself to enjoy the successes. My brother had been in my shadow for all of his life.  I realized that I needed to step away completely so I did and now he’s got the chance to experience that on his own, which I think has been really good for him.

-If you had the chance to do it all over again what would you do differently?

I would have insisted on a board of directors. Looking back I would have found other ways to at least have found an advisory board because I think ultimately that’s where I lost my motivation. I think that would have made a world of difference, probably to the point where I might have had the motivation to stay around. And I would have had the different perspectives and views to where maybe the company could have gone in a different direction and maybe become even better. Also, I would have forced my family to do more communication collectively as a family. Unfortunately the conversations that I typically had with my dad or my mom ended up being business-related. So we didn’t have that connection on a personal perspective. I would have tried to find some creative ways to where the family could have done some things as family. Probably use some outside facilitators to do that. Other than that I don’t look back and have regrets. I had failures over time but I wouldn’t trade those because I learned a lot from those failures.

-Do you have a word of advice for Next Generation members who find themselves going through a similar situation?

You’ve got to find ways to stay energized. And for everybody that’s different. For me what I realized is that I needed a support system that was going to challenge me intellectually, professionally and personally. I didn’t have that so I would say for anybody that’s thinking of running their family’s business or that’s in their family’s business and they’re just feeling overwhelmed in the process is to find that support network. Whether it’s a group of peers, friends, or an advisory board, I think you need an outlet to let things go. You need an outlet to bounce ideas off. An outlet where you can get some validation and support that gives you that strength, that energy to make the hard decisions. For me the hardest part was for a lot of time I made a lot of decisions where I felt like I was on an island by myself. So you really don’t have a basis to say am I doing a good job, am I doing a bad job? People are social; we need people to share things with. To continue to be energized and challenged—that’s the best advice I can give.

 

What about you? Have you gone through a similar experience? What have you done to overcome it?

 

 

Written by Carmen Lence, Family Business Coach and Consultant at http://www.nextgenfamilybusiness.com/

How to Keep Your Company in the Family for More than Five Centuries: Borja Raventos from Codorníu Explains His Keys to Success

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Borja Raventos is a 17th generation member of the family that owns Codorníu for more than five centuries.  Codorníu is the world’s largest producer of bottle-fermented  sparkling wine made by the traditional champagne method. Their winery was founded in Catalonia, Spain in 1551. Borja has spent most of his career outside of the family business, working on consumer products, but nowadays, he is a member of the Codorníu Board of Directors. From his unique perspective, Borja explains the keys to keeping the company in the family and how to develop professionally as a member of the Next Generation.

Codorníu is the oldest family business in Spain and one of the oldest in Europe. What, in your in your opinion, are the keys to keeping the company in the family for so long?

A great love for the product you are developing and the earth. Solid values in the family and the company which stand out: loyalty, honesty among family members, and social responsibility. Innovation: always be at the forefront of what is to come in the future.
Adaptation to market changes, professionalism in management of the business. The establishment of clear shareholders policies. Profitability and growth building brands, from a medium and long-term perspective and internacionalization.

– Has the fact that the age limit for remaining in the Codorníu presidency is 70 years contributed to the entry of new talent?.

The limit is 65 years old for executive positions and 70 for the presidency. This makes it possible to renew the charge, which is fundamental for the company’s success. It facilitates a clear succesion process and allows generational renovation.

Also, executive positions are limited to only four members of the family. These candidates are not chosen by the family. There is an external organ composed by two head hunters, a prominent professor at a business school, and the CEO, who evaluate candidates. After choosing the candidate, a report is sent to the Board of Directors, and they decide which candidate will be offered the positions.

Codorníu has gone from having an external CEO to appointing a CEO from the family, which has considerably increased sales and profits for the company. Is it a myth that professionalizing a company requires running it with executives from outside the family?

Yes, it is a myth. You have to look at the value and profile of each of the candidates, whether they are members of the family or not. You cannot generalize. It can happen that a family business has good candidates from the family, and hiring them does not lead to conflict, but in other cases it may. Decisions must be evaluated and made depending on the context of each family and each family business circumstance.

– In your opinion, what is the value added of hiring management talent from inside the family?
You cannot generalize, but family executives strengthen the connection between property and business; they are aware of two realities and can provide more credibility…but it is not always like that. It depends on each case.

– You have developed your career mainly working outside the family company in the multinational Sara Lee and, later on,  at Ferrero. In your experience, what are the main differences between working for a non-family business and a family business?

In family firms, there is an emotional bond that makes you look more from a long-term perspective, not only at valuations and company yields. In contrast, in a non-family business, short term results tend to be more important.

– In terms of family companies, you have worked in the Artesa Vineyard in Napa and currently as a Codorníu Board Member. What is the best part about working in the family business? And the worst?

In Artesa, I worked for six months while completing an MBA at IE. This experience helped me to learn about one of our most important markets, the U.S.
I worked for more than 11 years in consumer products multinationals. That helped me to become a good professional, gain self confidence, and learn new ways to manage a large company. Five years ago, I was chosen from among several candidates to serve on the Board of Directors at the Codorníu Group.

The best things about working in the family business are the emotional bonds and my good understanding of the wine market. They provide me with much strength to fight for the company. Another aspect is the satisfaction of proposing and applying the knowledge I’ve gained in other companies on my own family business. This is very rewarding and motivating.

The worst thing is that we are too emotionally involved, and that means thay we are not always that objective. We must make an effort to separate family from family business.

– You are now working as a consultant and coach for the family business. What motivated you to enter into this field?
What motivates me is the chance to help families and their members to learn more about themselves and take charge of what they really want to do in terms of their values and what motivates them. I help them to agree on a vision and motivate them to work together for a common goal. Also, to enable better communication and understanding of the other’s position. Finally, I accompany the new generations to be leaders in their companies and families, gain self-confidence, and work positively within their families and with business complexities in their own personal styles.

– What is your advice for those members of the next generation who choose to have their careers outside the family business?

Reflect on what you want in life and make a conscious decision that is your own decision. It is equally positive to work in the family business or out; it depends on the particular case. What is really important is that in all family businesses are difficulties, and the sooner these problems are worked out, the better.

Borja Raventós Board Member of Codorníu Group from Spain

You cannot generalize, but, in my opinion, it is important to have work experience outside the family business, whether you want to return to the family business in the future or not. I would advise people to work outside the family business at least five years. If it is possible, in a different city from where you live and, even better, in a different country. This will provide you with great self-esteem and self-confidence. You and your family business will benefit from the experience.

What do you think? Would you benefit from working outside that family business? Would that help to keep your company in the family for more than five centuries?

¿Cómo mantener la empresa en la familia durante más de 5 siglos? Borja Raventós de Codorníu nos da las claves.

Borja Raventós es miembro de la 17th generación del Grupo Codorníu, la empresa más antigua de España, y miembro de su Consejo de Administración. Borja ha desarrollado su carrera profesional fuera de la empresa familiar aunque siempre trabajando en productos de gran consumo. Desde su perspectiva única nos explica las claves para mantener la empresa en la familia y para desarrollarte profesionalmente como miembro de la Siguiente Generación.

Codorníu es la empresa familiar más antigua de España, con 5 siglos de historia. Cual son en tu opinión las claves para mantener la empresa en la familia durante tanto tiempo.

  • Un amor muy grande por el producto que estas elaborando y por la tierra. 
  • Unos  valores sólidos en la familia y en la empresa entre los que destacaría la lealtad, honestidad entre los familiares y la responsabilidad social.
  • La innovación, siempre estar a la vanguardia de lo que va a venir en el futuro.
  • La adaptación a los cambios del mercado, la profesionalidad en la gestión.
  • El establecimiento de normativas claras entre los accionistas. Por ejemplo la sindicación de acciones, la entrada de ejecutivos familiares y el conflicto de intereses.
  • La rentabilidad y el crecimiento, construyendo Marcas, desde una perspectiva del medio y largo plazo
  • Internacionalización.

– El limite  de edad para estar en la Presidencia de Codorníu esta en los 70 años de edad. ¿ Ha contribuido este limite a la entrada de talento nuevo?.

El límite es de 65 años para puestos ejecutivos y 70 para la Presidencia. Esto posibilita que se renueven los cargos, esto es fundamental para el éxito de la empresa. Facilita una sucesión clara y permite la renovación generacional.

También los cargos ejecutivos están limitados a solo cuatro miembros de la familia. Estos candidatos no los elije la familia, si no que hay un órgano externo compuesto por dos buscadores de talento, un conocido profesor de una escuela de negocios  y el director general, que valoran a los candidatos. Una vez escogido el candidato, de hace un informe que va al Consejo de Administración, y ellos deciden que candidato aceptan.

Codorníu ha pasado de un Director General ajeno a la familia a nombrar un Director General miembro de la familia que ha aumentado las ventas y beneficios de la empresa en los últimos años. ¿Es un mito que la “profesionalización” de la empresa signifique llenarla de ejecutivos ajenos a la familia?.

Si es un mito, hay que fijarse más en el valor y perfil de cada uno de los candidatos, sean familiares o no familiares. No se puede generalizar. Puede pasar,  que en una empresa familiar haya buenos candidatos de la familia y el contratarlos no genere conflictos, pero en otros casos puede que sí. Hay que valorar las decisiones a tomar dependiendo del contexto de cada familia y de cada empresa familiar.

– En tu opinión que aportan a mayores los ejecutivos que tiene vínculos familiares.

De nuevo, no se puede generalizar, pero los ejecutivos familiares ayudan a la cohesión entre la propiedad y el negocio, conocen las dos realidades y pueden dar mas credibilidad… pero no siempre es así. Dependerá de cada caso.

– Tu carrera profesional ha transcurrido trabajando principalmente en empresas ajenas a la familia, en la industria de productos de gran consumo como la multinacional Sara Lee y más tarde Ferrero también empresa Familiar. ¿Cuáles  son las principales diferencias entre trabajar para una empresa familiar un una no familiar?

En las empresas familiares hay un vínculo emocional que hace que se mire mas a un largo plazo, no solo a la valoración y los rendimientos de la compañía. En cambio, en la empresa no familiar lo que prima fundamentalmente son los resultados económicos a corto plazo.

– Dentro del Grupo Codorníu, has trabajado en vuestra bodega en Napa “Artesa”, y actualmente eres miembro del consejo de dirección de Codorníu. ¿Para ti que es lo mejor de trabajar en la empresa familiar? ¿Y lo peor?

En “Artesa” trabaje durante 6 meses mientras estaba haciendo el MBA en IE.  Esta experiencia me ayudó a conocer de cerca uno de nuestros mercados más importantes, el de EE.UU.

Posteriormente he estado trabajando durante más de 11 años en multinacionales de Gran Consumo.  Me ha ayudado a ser un buen profesional, a ganar seguridad personal y conocer nuevas formas de gestionar las grandes compañías.

Desde hace 5 años fui elegido entre varios candidatos a formar parte del Consejo de Administración del Grupo.

Lo mejor es el vinculo emocional  y el conocimiento del mercado del vino, esto te da mucha fuerza para apostar por la empresa. Otro punto sería la  satisfacción de aplicar o proponer muchos de los conocimientos que has aprendido fuera en tu propia empresa familiar, esto es muy gratificante y motivador.

Lo peor, es que estamos emocionalmente demasiado involucrados y eso hace que no siempre seas objetivo. Hay que hacer un esfuerzo por tratar de separar lo que es familia con lo que es empresa.

– Actualmente estas trabajando como consultor y coach de empresa familiar.¿ Cuál es tu principal motivación para trabajar con empresas familiares?

Lo que más me motiva es acompañar a las familias y  sus miembros para que se conozcan mas a sí mismas y pueden tomar las riendas de lo que realmente quieren hacer, desde sus valores y lo que les motiva. Ayudarles a consensuar una visión común que les motive a trabajar juntos por un mismo objetivo. Posibilitar que se comunique mejor y entiendan la posición del otro. Reconocer el “rol” que tiene cada uno en la familia y como propietario.

Acompañar a las nuevas generaciones a ser líderes en la empresa y en la familia, ganando en seguridad personal, trabajando positivamente en la complejidad empresarial y familiar, desde su propio estilo personal.

– ¿Qué le aconsejas a aquellos miembros de la siguiente generación que deciden tener su carrera profesional fuera de la empresa familiar?

Que reflexionen sobre lo que quiere en la vida y tomen una decisión consciente, que sea su propia decisión. Es igualmente positivo trabajar en la empresa familiar o fuera, dependerá de cada caso.

Lo que sí es importante es saber que en todas las empresas familiares hay dificultades y cuanto antes se trabajen estas dificultades, mejor.

De todas maneras, no se puede generalizar, pero en mi opinión es importante tener experiencia de trabajo fuera de la empresa familiar, independientemente de que quieran volver a la empresa familiar en el futuro. o no. Yo aconsejaría trabajar fuera por lo menos cinco años, si puede ser en una ciudad diferente a donde viven y si puede ser en un país diferente. Esto que les va a dar mucha más seguridad en sí mismos y tanto ellos como la empresa familiar saldrán beneficiados.

Borja habla desde su experiencia trabajando en empresas fuera del ámbito familiar y su experiencia como miembro del Consejo de Codorníu, pero como él bien dice, no se puede generalizar.

Borja Raventós Miembro del Consejo de Administración de Codorníu

En tu opinión, ¿ Crees que es mejor trabajar fuera de la empresa familiar? , ¿Crees que puede contribuir a mantener la empresa en la familia durante más de 5 siglos?