Every business that survives for any length of time eventually needs to find new leadership. Perhaps the challenges of the business now exceed the capabilities of the current leader. Perhaps the current leader wants to retire or has reached the company’s mandatory retirement age. Or perhaps the company leader is disabled or has passed away. Whether you’re trying to find someone to follow Steve Jobs at Apple or Don Stevens at Don’s Air Conditioning, finding an able successor is always challenging.
It is likely that not everyone on the management team and board agreed that Tim Cook should step into Jobs shoes at Apple. But at the end of the day, they went home to their families and friends. At Don’s Air Conditioning, if the leadership team that consists of three Stevens family members disagree over who should succeed their father, that disagreement and possible hurt feelings come home when the Stevens return from work. And do you think they might share their opinions and feelings with their spouses? Do you think the spouses may also have an opinion to offer?
An article in the March/April 2012 edition of Family Business Magazine describes how Wells Enterprises, the Iowa based maker of Blue Bunny ice cream (sales $1+ billion), handled succession for their third generation CEO. Through most of the company’s history, family leaders in the company collaborated as partners on decision making. But in the words of third generation member, Doug Wells, “We knew the weaknesses of inbred family management. We spent a lot of time identifying opportunities to improve and the additional professional expertise we’d need to do it.”
The Wells family and non-family management brought in consultants to run a process that resulted in a proposal to change the management structure and the makeup of the board. Mike Wells was named CEO and four other family members stepped down from senior positions at the company. Three of them still serve on the board, but are now joined by three outside directors. Historic, significant changes that I imagine tested family relationships. But listen to how Doug, who had been a co-President, viewed the situation “It wasn’t my goal to retire at 55, but sometimes you have to look at yourself in the mirror and ask what you want to do and what is the right thing to do. It was a critical time for the business. We couldn’t only think of family; we have responsibilities to our employees and our town.”
Congratulations to the Wells family! They identified the succession issue and applied time and resources to address it. They also likely worked through some difficult family and emotional issues. The result: a decision that has worked well for them, their employees and the community. The article concludes by quoting CEO Doug Wells, “We are a great example of a family business that protected the family by putting the business first. Shareholders are enjoying greater benefits because the company has accomplished great things. We made tough decisions in 2007, and we’ve been proven right.”
To celebrate their success, I think I’ll enjoy a few scoops of their Blue Bunny Chocolate Ice Cream while I play another game of Angry Birds on my iPad.