June 18, 2014

Good Succession Planning Yields Results in Family Owned Business


Wildish Land Company of Eugene was recently named "Large Family Business of the Year" by the Austin Family Business program. It is a model for succession planning in closely held businesses.

When Thomas C. Wildish came to Eugene from the Dakotas over 65 years ago, he formed a trucking business with his son Leonard and son-in-law Bob Steadman. Soon they were delivering sand and gravel mined from the Willamette River after the spring floods.

Thomas C. and his wife, Verna, had twelve children. Most were involved in the company directly or through spouses or children of their own. Sons Norm, Richard, and Jim worked as managers virtually all their adult lives. Second son Thomas E. did not enter the company upon graduation from the University of Oregon in the 30's but, on the retirement of Leonard in the mid-70's, left an executive position with Union Carbide to take over as CEO. Leonard's son Gary went to work briefly for another company after college, but then joined the company a short time later. Jim's sons Mike and Steve, and Richard's son, Bill, became managers when they graduated from college. After the death, at age 101, of Verna Wildish, youngest son Jim and his sons and nephew bought out the interests of the original family.

Today a number of fourth generation family members are actively involved with the company. They now have the opportunity to run a business started by their grandfather and nurtured by their father and uncles and, in their time, to pass it on to their own children or cousins.

This remarkable family and its vertically integrated construction business — probably the only company in Oregon that can handle every aspect of a building construction project from start to finish — exemplifies eight of the keystones to a successful family business!

1. Be Conservative. Thomas C. began with something he knew — trucking. He had good marketing and organizational skills and, with Leonard maintaining the trucks at night, the business grew. Starting with sand and gravel supply, the company moved into construction, to crushed rock products, to concrete, to asphalt, to paving construction, to heavy construction, to utility construction, and finally to building construction. Each slow foray into uncharted territory was based on careful planning and appropriate research. If things didn't work out (as with remote plant sites in Corvallis and Medford in the late 70's) the experiments were quickly shut down.

2. Invest in the Business. The Wildish family has never paid itself a lot of money. They lead comparatively modest lives. They build up the business, not their personal toys.

3. Invest in People. Hire and train the best people you can get. Give them a chance. Reward them appropriately. Some of the brightest people in the northwest construction industry work for, or have worked for, the Wildish companies over the years. Some are still there; some are competitors; some are involved in completely different walks of life.

4. Give the Family a Chance. What good is a family-owned business if it can't give jobs to family members? At Wildish, upwards of 45 family members have been on the payroll. They have served as managers, receptionists, the company nurse, foremen, superintendents, laborers, and mechanics. Practically any family member was given a chance, but members who couldn't cut it were let go or encouraged to find jobs elsewhere.

5. Listen to Professional Advisors. Many companies fold when the founder dies. Wildish did not because, when Thomas C. died in 1963, he had listened to his attorney and left a will and trust that minimized taxes and kept control of the company in the family. For more than 25 years the trust, and the strength of a mother, kept the company ownership together. Attorneys have advised the Wildish family on all sorts of business issues, including the buy-out of the original members by the current management group, but other professional advisors are important as well. Production experts advised Wildish on how to optimize its material production plants; CPAs advised on tax strategies; when statewide land use planning became an important issue, Wildish consulted planners. They hired professionals, and they listened to them. And the success shows.

6. Know When To Say When — and Do It! There can be no succession in any business if the predecessors won't let the successors have a chance. Leonard took over when his father died. Ever since, new management has had the contemporaneous support and counsel of old management. Tom, Norm, and Richard took over from Leonard. Jim took over from Tom and Norm. Now Jim is letting Mike, Steve, and Bill run the companies. This is the opposite of ego-driven control. It's family members facilitating a legacy.

7. Be Fair and Honorable. Nothing is more valuable than a reputation for honesty and fairness. It reaps dividends at times expected and unexpected. These traits are even more important when the family's name is on the door.

8. Never Take Your Eye Off the Prize. Whatever the prize may be, focus is all-important. For the Wildish family, the prize has been jobs in the community for family members and others who wish to support the family enterprise. These jobs have allowed family members to work together and enjoy freedom and financial security — the American Dream in every sense of the word.

For more information on this topic, please contact marketing@jordanramis.com or call (888) 598-7070.


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