uccession planning for a family business, never a simple task, can assume epic
proportions when the second generation is 12 people-strong.
Amy Marshall, head of business development at family-owned
Marshall Sales Inc. and Aluminum Supply Co., is one of 12 family members who have
been involved in running the Detroit-based business founded by uncle Robert Marshall.
"Now three of us are active in the day-to-day business,"
she says. "One more sister is our consultant on our quality program, and all six
[sisters] serve on the board of directors."
Each sibling, Marshall says, has worked outside the
company, gaining valuable business experience before returning home.
"I think that is one of the things that has really helped
the second generation immensely ... those experiences helped us all bring something
to the table," she says.
When it came time to pass on the business, father Rex
Marshall gave his progeny shares yearly, Marshall says. But it wasn't all smooth
sailing.
"My father had the wisdom to do this succession planning
... you have to name one out of 12 who is going to be in charge," she says. "It
can't be two; it can't be 12. When that decision was made, of course, several people
were disappointed in the choice. Decisions like that have caused some grief. There
have been some unhappy separations, some sore spots that have made it uncomfortable
in business and the family."
With 12 in the second generation, there's a wide pool
of talent when it comes to recruiting third-generation leadership for the combined
companies, which reported fiscal year revenue of $11 million. But being a member
of the family isn't a free ride.
"We have a summer internship for the third generation,"
Marshall says. "This summer, there are five of the cousins working there.... They
can come in and get an idea of what's involved. When we have positions that are
available, that person would interview…."
Marshall says her 23-year-old son, Kalani Ben, is working
at the business this summer, but says she’s not sure that it will be his career.
"We strongly recommend they get job experience outside
the company first," she says. "Coming into just the family business, they could
have a certain false sense of security, and perhaps even entitlement."
Passing the torch to the younger generation should prove
complicated, Marshall says.
"With us, there were 12 siblings, and all but one sister
have children," she says. "We actually have some fourth generation who are of working
age now.
"One of our bigger challenges is not only how do siblings
gain right of entry, but when we do our succession planning, what do we do about
this third generation? How do you give priority?"
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