Taking Over The Family Business

Q: I've recently given up practicing law to join my father's 18-year-old pharmaceutical company. The company can't seem to grow beyond a certain level and gets the same amount of business with absolutely no marketing or business development efforts-relying strictly on word-of-mouth. My father is the president, CEO and chief decision-maker, and he's approaching retirement age. He runs the business rather autocratically, directing his employees on how to run test procedures and so on. Because I'm not a chemist, I can't run the business the same way. Do you think it's realistic for me to run a technical business in which I lack the technical expertise, even with the help of experts and if not, what steps can I take to assemble a competent technical team, and how can I attract them to stay with a small family-owned firm?

A: The answer to your first question is an unqualified "yes." Charles Brewer, the founder of Mindspring, the Internet service provider that recently merged with Earthlink, knew practically nothing about computers and was still wildly successful with an existing company, what's needed isn't technical expertise but people expertise. Many a company has been ruined by its founder's technical expertise. It's not unusual that a founder will hold tightly onto the reins of the company when he should turn them over to others. While I'm sure it's hard to let go of "his baby," it's probably necessary if your father wants the company to grow and thrive.

What will cause your company to grow will be capitalizing on the talent and energy of others. Your expertise needs to be about how to bring out the best in your team. While autocratic management can produce results, it doesn't cause people to give their best. Further, it's increasingly out of step with the younger generation. Younger employees have been raised on a steady diet of positive reinforcement and don't stay long in an environment where negative reinforcement is a common occurrence. That kind of workplace will make it almost impossible to attract and retain the kind of employees you'll need to move the company forward.

Management is about creating successful employees. Make that your job mission. When an employee's success is clearly related to the success of the company, everyone wins. I don't mean this only from a financial perspective but in every accomplishment. Find ways to provide positive reinforcement daily. Don't wait for large accomplishments before showing some appreciation or recognition. Find ways to let people know daily that their contributions, efforts and ideas are valued. It can be as simple as a complementary verbal or written statement or as easy as encouraging an employee to relive an accomplishment by asking her to tell you the details of how she achieved the positive result.

Fortunately, the same positive reinforcers you use to show employees you value them on a daily basis will also help you attract and retain talented workers. Delivering positive reinforcement doesn't require large salaries and huge benefits packages. Contrary to popular opinion, employee loyalty and industriousness aren't about money and benefits. Trudy Evans of Margate, Florida, said it well in a letter to the editor in USA Today (May 9, 2000) "Employees leave bosses, not companies." Her letter was in response to the recent announcement by the Coca-Cola Company that they were giving an extra vacation day and a half-day on Friday off in an effort to stem employee turnover.

"…Adding another holiday or giving employees Friday afternoons off will not satisfy what workers truly are yearning for, " Evans wrote. "Employees are people, and people want to be cared for. They want to be recognized for a job well done, encouraged to take risks and guided when they are not sure of themselves. People leave companies because they don't get the attention they need from their managers-not because of the benefits."

Make learning about human behavior a priority and your daily preoccupation. If you do, you'll find you'll have the "technical" knowledge to create an environment where people want to work and do their best every day.

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Aubrey C. Daniels, Ph.D., founder and CEO of management consulting firm Aubrey Daniels & Associates (ADA), is an internationally recognized author, speaker and expert on management and human performance issues. For more about ADA's seminars and consulting services or to order Aubrey's book Bringing Out the Best in People: How To Apply The Astonishing Power of Positive Reinforcement, visit www.aubreydaniels.com, or contact Laura Lee Glass at (800) 223-6191 or lglass@aubreydaniels.com.

The opinions expressed in this column are those of the author, not of Entrepreneur.com. All answers are intended to be general in nature, without regard to specific geographical areas or circumstances, and should only be relied upon after consulting an appropriate expert, such as an attorney or accountant.