Dan Schneider

Business Performance: More Than a Fairytale
March 11, 2008

Jacob and Wilhelm Grimm were partners in a family owned business. They told stories and tales, many of which apply to the circumstances family businesses frequently deal with.

In their version of the The Golden Goose, the Brothers Grimm features a family of three sons. Two are brilliant and charming – the heirs apparent. The third, whose name is Dummling, is pretty much viewed by everyone else as an air head. 

Over the years, Dad’s motivation and perspective have had a profound impact on the overall culture. The culture of a business ultimately takes on the motivation, values, and priorities of the owner. His attitudes have impacted the older sons, who have been favored all along. The Family Dynamics and the Family Governance practices have given them an edge.

However, family business succession requires available, capable, and committed successors.  As the two older sons set out to keep the family logging business going, each falls victim to an entitlement mentality (take care of me first) and comes up with a career ending injury. As a result, Dad no longer believes that he has available and capable successors. He’s left with Dummling, who seems to be available and committed, but not capable. 

Maybe it’s time to contact a commercial broker and sell the business.

But wait! Dummling begs Mom and Dad for a chance to get involved in the business. They give in, and send Dummling on his way. Having received only limited Successor Preparation, the third son is left to his own intuition to make a success of himself.

Now, in most circumstances, capability requires customized training, development, mentoring, and career progression. None of that has been available to Dummling. How can he make it?

While he may not have been the first pick, Dummling begins to show unrecognized potential. He takes advantage of what we now call Management Synergy and Teamwork, and he makes some wise choices in employees, vendors, and customers. Since business succession is not a solo endeavor, he relies upon competent, motivated and trusted associates to accomplish business and personal goals.

In the end, Dummling tames the forest, gets the gold, wins the girl, and lives happily ever after. In terms of modern day succession planning, what are the morals of the story? 

1. You don’t need the best and the brightest people. You need the right people.
2. Motivation and perspective rub off. Is yours worth catching?
3. Commitment trumps entitlement.
4. Develop everyone so you have a deep bench.
5. Expect to be surprised.
6. Succession Success is more than a fairy tale.

Posted by Dan Schneider on March 11, 2008 | Comments (0)