Phil Ryser is not a member of the Bates family that launched Stanley Steemer International Inc. back in 1947. But his involvement in the 2,000-employee cleaning company is vital to its success.
Ryser says one of the keys to that success is a willingness to reach outside the family and provide opportunities to anyone who can help the business grow.
“There are a number of different avenues of opportunity within our organization that have nothing to do with whether you are a family member or nonfamily member that enable you to achieve success,” says Ryser, the $400 million company’s executive vice president, secretary and general counsel.
“Candidly, as an adviser or nonfamily member, you need to help them identify what are the strengths and weaknesses in terms of the ability of the company to achieve the growth mode that they have communicated to you,” Ryser says.
Smart Business spoke with Ryser about some of the keys to making a family-run organization work.
Come up with a plan. What are the primary goals of the family? What is it the family or the entrepreneur wants to accomplish long term? Do they want to be the biggest? Do they want to be the best? Do they want to be the richest? What is it that they are seeking to accomplish?
Entrepreneurs seem to have the ability to envision what it is they want to accomplish and where it is they want to go with a concept or idea from infancy to fruition. Along those lines, you also have to take the temperature of the family itself beyond the business goals. Ultimately, what is their goal?
Do they want to keep the business in the family for generations to come? Do they want to sell? Are they willing to bring in venture capital partners to help them grow the business? Do they want to go public? Some of those goals may be formulated early on and some of those goals may take a period of years to be formulated. Sooner or later, they need to be addressed.
It’s very important that they understand ultimately what it is they want that identity to be now and what they want it to be down the road.
Put someone in charge. One person ultimately has to have control and be in charge. My experience with rulership by committee is it’s not an effective platform to run a business. It may not always be the fairest arrangement, but typically, it seems to be the most effective.
At the same time, it’s important to have either an independent board of directors or at the very least an advisory board with whom the senior management of the company meets regularly.
When I say regularly, I would typically recommend at least once a quarter. That should serve as a platform at which there is always full disclosure. There is a discussion of all issues, both financial and otherwise.
Have an effective advisory team of people with whom management deals with on a regular basis. Typically, those are going to be comprised of an attorney or group of attorneys with various expertise, CPAs, insurance professionals, then of course, your banker and, in some cases, if it’s appropriate, a financial planner.
It’s important those people all work together. Oftentimes, I’ll see a mistake made where perhaps the entrepreneur will want to have each of the type of people I described, but then they’ll want to work with each one of them separate.
Then decisions get made in a vacuum and you kind of lose some of the effectiveness of the cohesive combined effort of all those people going in the same direction. You have people pulling and pushing each other in different directions.
