From Kid To King

Next-generation leaders need experience to get to bottom-line profit.

By Mike Henning

How do you know your son or daughter can actually make a profit? How will they react when under pressure from a competitor with deep pockets to meet a payroll or to feed Uncle Sam's tax machine? How do you know how they will react to a serious personnel situation? How do you know how they will treat you and their siblings when they have control?

These are all questions harbored in the souls of senior business owners. Many times, it is these questions and potential answers that create serious doubt as to the next leader's ability to run the company successfully into the next generation. What are the answers to these and other questions commonly raised by members of the senior generation?

Many small business owners do not necessarily see themselves as leaders, visionaries or motivators of people, but they are, particularly when serious problems arise in their companies. They are the ones who must remain calm and reassure their employees, suppliers and customers. They are the ones who motivate their people to charge ahead and do what it takes to be successful. They are the ones who are the strongest, most knowledgeable and experienced. They are the ones who are calm, cool and collected and upon whom others can depend to lead them through the crisis. During more normal times in the business cycle, that leader/owner may become a manager, supervisor or employee, or just do what it takes to complete a project on time. But when leadership skills are demanded of them, they have what it takes.

The key word in the above paragraph is experience! Some things—like swimming, operating a computer, speaking a foreign language or flying an airplane—can only be learned by experiencing them. I submit that running a business also fits into this category. Former New York City Mayor Rudolph Giuliani in his book Leadership says, “There's no substitute for personal experience when it comes to dealing with problems, particularly in time of crisis, when there is less or no time to develop ideas and plans.”

How to Be Prepared
Potential next-generation leaders need the experience of making decisions that will lead to a bottom line profit, such as handling personnel (who are, for the most part, older than they are), dealing with customers and developing people around them. They need an opportunity to handle crisis situations, manage their time and create a balance between personal and business life. They need an opportunity to commit their career to the family company and put some “skin” or money in the game. Nothing like putting a second mortgage on your home to get the feeling of ownership and urgency! The answer is offering the next potential leader(s) the chance to run a portion of the business, such as a department, then two departments and a computer system, then a branch operation with the support of the manager. Yes, there needs to be supervision with regular meetings to discuss successes and how to improve areas that are not as successful. The “leader in learning” needs a mentor to coach him/her regarding guidelines, policy and safety nets, and someone to talk to privately about concerns, issues and sources of learning. The young leader needs to group regularly with those of similar age who are going through the same experiences, so they can compare notes and take advantage of each other's situation.

Giuliani states, “Having a mission or an overarching goal is critically important in time of crisis. You can step back and quickly access what you really want to accomplish and what resources you have available.” He also says, “Preparation is essential for successful leadership. No one, no matter how gifted, can perform without careful preparation, thoughtful experimentation and determined follow-through.” These qualities, executed properly, ultimately lead to good decision-making, which leads to business survival and success.