- After graduation, in 1992, Laurie Union took over her family's corrugated roofing business, which was on the verge of bankruptcy.
- As president and CEO at age 27, she successfully turned the company around and sold it a few years later.
- Union shared five principles that he says helped save the declining business that bears his name.
I never planned on joining the family business. My grandfather started a corrugated roofing company in North Carolina in 1946, and my parents ran it until I graduated from business school in the 1990s. After graduation, I planned to move to Boston with my husband.
But then my father got ill and the company got into dire financial difficulties. My mother, who had no business experience, asked me for help to turn things around. The business seemed hopeless, but I wanted to help my parents pay off their debts.
That meant I became president and CEO of a sinking ship in 1992, at age 27. Morale was low, and we had just lost our largest customer, which accounted for 25% of our revenue.
I was able to overhaul the company and turn it into a profitable business, eventually growing it to 350 employees and selling it to a private equity firm in 2004. Here are five lessons about running a family business that helped me get there.
Let go of your ego and learn to feel comfortable saying, “I don't know.”
We often think of being a leader as knowing what to do. When I joined my family business, I had prestigious degrees, including an MBA from Harvard, but I knew very little because I had only worked there for six weeks over the summer, and I had no experience leading an organization.
I quickly realized that the people working at this company had a vast amount of knowledge, and I realized I could contribute much more by asking open-ended questions than by taking the lead and telling people what to do. I spent most of my first few months interviewing people within the company to understand the business.
As a result, in just a few months, I knew more about the business and industry than nearly anyone else in the company. While each person knew their role, I had a broader view of the company because I had interviewed so many people. I imagined everyone had their own slice of the pie, but my goal was to see the whole pie.
Get closer to your family, but don't let their feelings affect your decision.
Working with families can bring up strong emotions, like the frustration when a parent tells you what to do in front of other employees you're trying to mentor, or the feeling of rejection when a parent doesn't acknowledge what you consider a great accomplishment.
Families communicate emotions between members, and negative emotions can swirl around. These negative emotions can cause people to make decisions that make them feel good, rather than the best decisions for the business. These negative emotions can seriously damage family relationships.
Be mindful of your own emotions and be empathetic to your family, but be prepared to make difficult decisions to achieve your shared goals. Spending time with my mom outside of work has helped us stay close even when we don't see eye to eye at work.
It's easy to get your employees to understand your family values, so use them to your advantage.
Family-owned businesses have the superpower of consistently communicating a set of values that employees and customers can relate to, making the job of running the business meaningful for you and other stakeholders.
In my case, longtime employees remembered the values their grandfather's company once stood for and found themselves disheartened by many of the company's more recent practices: Employees were lying to customers and acting as if everyone was part of a losing team.
When I met one of the company's former employees, he recalled that my grandfather had insisted on not raising prices for roofing work after Hurricane Hazel in 1954. That story resonated with me, so I mentioned it at a company meeting.
Other employees stood up and told similar stories. At the end of the meeting, we all agreed that no matter what happened, we would always do the right thing, even if it meant losing profits. We would never lie to customers, and we would always admit when we couldn't meet their needs.
That was a turning point for the company. Employees felt like they could be their authentic self, which drove the company forward and contributed to its growth.
Don't be afraid to take your business in a different direction than your parents did.
Family businesses may be slow to change because of the importance of maintaining traditions and long-term relationships with employees and customers. Parents who run a family business may expect their children to follow in their footsteps.
But the average business today only lasts about 10 years, and families who expect the next generation to follow a cookie-cutter approach are at risk: the next generation may not be fully engaged, and the business may not keep up with the times.
My advice would be to find your own position and move your business forward.
In my case, what was clear to me was that my family-owned business was not a very good business and was poorly positioned in a declining market. Our customer base was shrinking, our equipment was old, and our employees hadn't received a raise in five years. We had six facilities in multiple states, most of which were piled high with old product.
When I took over, we decided to completely change the company model. Instead of bulk shipping to many customers in a wide area, we focused on small areas and shipped small loads quickly. Eventually, we raised enough money to buy one new machine, and our success continued from there.
Don't try to conform to someone else's leadership style.
In a family-owned business, leaders have the opportunity to shape their own leadership style. Understand how others have led businesses in the past, but don't be tied to it.
I was a young woman running a male-dominated construction supplies company. All of the company leaders, not just CEOs, were men. Many managers were more authoritarian in their approach, with harsh language and aggressive postures.
I wasn't happy about that, but it was my family's business, and I was able to try different teaching methods. I tried to approach it with more calm and curiosity.
Finding my own leadership style, rather than trying to fit someone else's, has made me a more effective and authentic leader.
