What leadershi style works worsf- I fol fiatnily businesses?

f enor,nsHtP-rHAT commonly used but nebulous Lterm-is present to one degree or another in all family businesses. New research in the Journal of Family Business Strategy sheds light on which leadership variations are the most desirable in facilitating family business succession - as well as which is the worst.

First, a bit about leadership in general. The term itself is very difficult to define although there is no shortage of people trying to do so. Between the years 1986 and 1996' iheri *"re 17,800 articles published on leadership, and that number has surely increased in the time since. A quick search on Amazon reveals that there are 18,855 leadership books available. And every author has his unique take on what it is, what it does, what makes for the best leader, etc' For our purposes, let's use John Maxwell's simple definition and say that "leadership = influence."

The scholarly article at hand identifies three types of leadership, all of which are paternalistic. The author states that paternalism is a defining characteristic of the family ownership model because "...paternalism is like the relationship between a father and daughter or father and son," so the iamily leadership model is translated into the family business.

Paternalistic leadership is present in founder-led family businesses or in ones where a Generation Two (G2) sibting has assumed a role similar to the one established by hei father. As family firms succeed into G3, G4, and beyond. there is less and less likelihood that one would fini the same paternalistic leadership styles. perhaps in the future as more family firms have female executives, academics may comment on maternalistic leadership styles!

What are the three leadership styles?

Authoritarian: The authoritarian paternalist asserts control and expects unquestioned obedience from subordi_ nates.

Benevolent: The benevolent paternalist respects subor_ dinates, cares for them, satisfies their individual feelinss and needs, and provides them with support.

Moral: The moral paternalist leads with superior personal virtues and by example.

Two of the leadership styles are associated with suc_ cessful intergenerational transition, and one is associated with detrimental succession outcomes. Can you guess which one that might be? You got itl

Family business leaders who think they know best, make all decisions unilaterally, and think that the decisions they make on behalf of others are always best contribute to feelings of dissatisfaction and inertia amons their succes_ sors. They can be characterized as ,.judgi and jury on everything" and tend to meddle in the affairs of even annointed successors.

Authoritarian leadership may be acceptable or even desirable at some stage of a family company's evolution, but when it comes to succession, authoritarians present many difficulties and make the job of continuing the fami_ ly business and the founder's legacy much more difficult.

What alternatives are available for family firms who are simultaneously interested in successful intergenerational transition and have an authoritarian leadei who may harm-consciously or subconsciously-the succession process?

l. Utilize afamity business advisory board.

Boards which are comprised of one or more, in Leon Danco's words, "risk-taking peers" are able to look authoritarians in the eye with nothing to lose and give them blunt counsel. It's a very different dynamic when an authoritari_ an's peer tells him to go jump in the lake rather than his daughter. A risk-taking peer, ideally from a business larg_ er, more complex, and more successful than the authoritar_ ian's, is a wonderful balance point between the generations who, while interested in the same long term goal, may propose dramatically different paths for getting there.

2. Hirc nonfamily, professional management.

A professional business manager can serve as the bridge bgtwgen senior and junior generations. Bridge -unug.i, should be somewhat younger than the senior generaiion but a bit older than the successors. In addition to beins a management bridge, this executive can be a demograpf,ic bridge as well.

3. "Mo, up" (and this applies to women, as welt!).

Grow some courage and stand up to authoritarian behavior. One of the reasons authoritarians utilize this leadership style is that they may sense weakness among the next generation. Standing up to an authoritarian, althoueh

(Please turn to page 44)

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APA Revamps Websites

APA-The Engineered Wood Association has reshaped and relaunched several websites, offering simplified navigation and improved search functionality of its EWP resources '

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Alaska Manager Accused of Theft

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BUILDING INDUSTRY SHOW of Southern California held ns 25th conference in Riverside, Ca. [1] Bill Andersen, Ken Goodnough. [2] lan Murphy, Jeff Sturdivan. t3l Keith Hitchcock, Eddie Meek. Joe Morin. [4] Bob Tavlor. Denise Bough,-Mire glario. [5] Gary Crowel, Dave Bufe, Ra'ndv & Kim Richards. [6] Landon Boucher. Al Potter. -

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LOS ANGELES Hardwood Lumberman's Club recently held its Alan Bohnhoff Memorial golf tournament. [1] Scott LegJos, Matt Barrass, Russell Hullinger, Oa-viO Tritz. [2] Jim Burns, John.9regory, la1.!ui19., John Wiesen. j3l Stephen McEiven, Al Reed, Dan-May, David Frick [4] Bovd Becker,'Bruce Hutchinson, Andrew Nuffer. [5] Chris Skibba, Joe biirite, tttite Hammer, Greg Hexberg. [6] Jeff Elliolt, Aaron Paris, J.J. Jebeiian. Corev Dickev. t7-l Darrel Covey Dave Holder' [8] Nathan Coveiv. fodd Gieason. igl Sean Shedlar, Scott Jones. [10] Tom Urquizo, Dan Jones. [11] David H-att, Aon Payne, Jim Favreaux, Nathan Simon' 112l Martv F6x, Jason Brettinqen, Roder Reyes, Craig Jordan. [13] Steve ArnbtO, trlart< Brothers, Jake Biosterhous. [14] Jim Gaither, Kevin Tr-ussell.

115l M'ark Huff, Dan Bohannon, Mike Walters. [16] Kip McCleary, Deonn befbrd. t17l io'e Morin, Keith Hitchcock. (More photos on next page)

Raul Aldrete

Lucero Aviles

Antonio Avina

Paul Blevins

Norm Boucher

Edward Butz

Jose Chicas

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Nick Ferguson

Vince Galloway

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MORE NAWLA (continued from previous paod: l2jl Dan P^aige,.Patrick Adams. [22] Michelle Burbank,-Tom R6gers. [23] Mark Grube, Kaycee Hallstrom, Al Gedroez,'Joe Honochicl<. [24] JenniferRaworth, Carol Green, Barry Bauman, Dave Jara, Doug Clltheroe. [25] Rick Benton, Lou Kurcsics. {261 Steve Clitheroe. [27]-Chuck Gaede, Brent Wooster. [28] Wes Bush, Wayne Jbrdan. [29] Ryan Schaefer, Mike Moran. [30] Vince Jordan, Roberi Harris. [31] Cnns Building-Products.com

Bergin, Laila Bradwell, Wayne Knutson. [32] Lee Jimerson, ,lFlk Sllw.qrL J33l Andrew-Goodman, Saiah'Madonia, Bryan White. [34] Philip Flemming, Michaet Nieily. [35] Tioy Lundquist, David Hanson. [36] Al Fortune, Micha-el Mitten, Bryan Lundstrom. [37] Chris Boyd, Peter Stroble, Joe penrod, Norm Toews, Mike Pedersen, Jeff Cook. [38] Holly Elliott. [39] Win Smith.

(More Traders Market photos on next four pages)

TRADERS MARKET (continued from previous two pages);.[4!] Kim Glaeser, Shana Gonda, Alan Oakes, Nikki Robbins. [41]-Dave Wildeman, Kristie McCurdy, John Lentz, Richard Mills. [42] Tim Ehers' l43l Lucas Howard, Kavle Wicks, Scott Purdue, Devin Stuart, Jared Wn'ite, Joey Inskeep. t44l Mike Limas. [45] Tiomas P1a-slchaert, Bryan Kirit. 146l L'arrv Petiee, Rivmond Luther, Joe Petree. [47] Reed Rediger' l4Sl Blake Kditzman, Marty Thomson, Todd Davis, [49] Janne & Max

ATTENDf NG the NAWLA Traders Market (continued from previous three pqges): [57] James Robbins, Phillip Humphrey, Curt Mcleod, Tonia Tibbetts, Ahen Robbins, Aron Kurlander, Roger Champagne. [58] Mark Westlake, John Morrison, Chase Monison. [50] Ted Oergdusofi, O'eepat Rai, Darc_y Jahal, Richard Paci, Joshua Xaye. t0O] Scdtt .lanett, tirry Boyts, 161l JimWalsh, Sue Snugg_s, David Smith, Michael Kirketie. [62] Randi Walker, Michael Mclnnes. [63] Greg Haupt, Matt Weaner. iO+i

Rick Rakoczy, Bryan Schuyler. [65] Mike Gerstenberqer, Robert Hafner. [66] Eric Swanson, Dennis Ebel, Jim Edinger. l6il patrick Hanulak, David Jeffers, Dave Siteman, Robert White, Fabio Amendola. [68] Teni Collins, Jimmy Swanson. [69] Brad Monow, John Pace, ChrisHedlund, Mike Kelly, Rick Kapres. [70] Mike Pidtisecky, Tim Fotster. [71] Natatie Macias.

(More Traders Market photos on next two pages)

Bf G TURNOUT for Traders Market (contlnued from previous four paqes):1721Eddie Pratt, Tim Svarczkopf. [73] Tim Gabriel, Bob Loew. iZ,it Marina'tt Lauch, Tim Atkinson, Pete Henningfeld. [75] Trevor Ewert, Sein Nason, Steve Barth. [76] Kim Pohl, Lisa Martin. [77] Jim Vandeqrift. [78] Mark Tucker, Edward List. [79] John Branstetter, John Walcoti, Ron Gbrman. [80] Scott Elston, Kathi Orlowski, Mark Erickson. [81] Brenden Heyberg, Tim Hummel. [82] Jeff Herscovitz, Chris Leslie'

Yvonne Jacobs, Ryan Wolters. [83] Joe Fan, Christopher Webb, Donna Allen, Rob Latham. [8a] Ryan Chitwood, Robert Hoffm-an, Anthony Panzarella, Tom Merkeri. [65] Leslie Southwick, Carter Stinton, Brad Hatlev. 186l Garv Snider, iom Batdautf, Casey Epperson, Kris Owen, J.R. Yirriich, Jeff Wllson. [87] Mike Goodman, Josh Goodman.

(More Traders Market photos on next page)

Barclay Simpson, 93, founder of Simpson Strong-Tie parent Simpson Manufacturing, Pleasanton, Ca., died Nov.9.

After serving as a fighter bomber in the South Pacific during World War II, he returned to U.C.-Berkeley, but in 1946, three credits shy of graduating, he took over his ailing father's business, Simpson Screen Co. He grew and transformed the company into a structural connector giant, with offices and factories across North America, Australia, Europe and Asia.

He continued to serve on the board and as head of investor relations until 2012, and retired last year.

Christopher Ernesto ttChris" Re, 58, trader at Patrick Lumber Co., Portland. Or.. died Oct. 28.

During his 4O-year career, he worked for a number of wholesale firms, including Timber Products, Seneca Wholesale, and MaywoodAnderson Forest Products, before joining Patrick.

John William Bacon Sr., 84, prolific Bay Area lumberyard owner, died of cardiac arrest Nov. 13.

He started his lumber career in the early 1950s at San Bruno Lumber Co., San Bruno, Ca. In 1964, he purchased San Mateo Lumber, San Mateo, Ca., with his father-in-law,

William W. Jackson. In 1971, he left San Bruno Lumber and acquired South City Lumber & Supply, South San Francisco, Ca. In l975,he bought Economy Lumber Co., Oakland, Ca., and in 2010 added Piedmont Lumber, Oakland-now Economy Lumber Piedmont.

Donald L. "Don" Murphy, 84, former president and co-owner of the old Plains Building Supply, Torrington, Wy., died Nov. 17.

After serving in the U.S. Army in Japan during the Korean War, he joined his brother, Lowell, working for McCreery Lumber Yard, Torrington. He and his brother struck out on their own and opened Plains in 1962, operating the business for several decades.

Doug Cashin, 69, salesman for Tyee Timber, Coquitlam, B.C., died Oct.23.

After receiving a degree in forestry from the University of British Columbia in 1969, he began his 40plus year industry career, spending the bulk of it with Cattermole Timber, Vancouver, B.C.

James E. Johnson, 69, former maintenance supervisor at Champion International, Bonner, Mt., died of cancer Nov. 1 in Polson, Mt.

A U.S. Army veteran, he joined the Bonner mill-then Anaconda Forest Products-in 1963, first as a millwright and then a machinist. He stayed on when the mill was acquired by Champion in 1993, but let go when it was purchased by Stimson Lumber in 1993.

Family Business

(Continued from page 29 ) he may not appreciate at the time, is about the only way to demonstrate that the next generation has the backbone and moxie that it takes to continue the senior generation leader's success. Strong leaders appreciate and expect strength in their successors.

4.wolkoroy.

There are times when that most wonderful, essential quality for family business succession is missing, and if that's the case, NextGen family members should have the courage to recognize the situation for what it is, put aside foolish hopes that "Mom and Dad will see the light if we just take them to one more seminar," and find employment in a place where they can get their economic needs met without all the weeping and gnashing of teeth present in the family company. Oh, by the way, that wonderful, essential, often missing quality is reasonableness. It's awfully hard to reason with people who insist on behaving unreasonably!

In most contexts, the term paternalistic leadership tends to be used in a derogatory way. However, paternalistic leadership doesn't have to be a negative and may be a great blessing if the senior generations' hearts are in the right places. Irrespective of the leadership dynamics of the senior generation, it's incumbent on all stakeholders from all generations to come together and do the hard, sometimes dirty work necessary to assure succession planning bears fruit in the family business.

- Wayne Rivers is the co-founder and president of the Family Business Institute, Raleigh, N.C., and author of such books as The Top Nine Reasons Family Businesses Fail. Reach him at wayne.r iv er s @family b us ine s s ns t it ute.c om or (877) 326-2493.

Reprinted with permission of the Famib Business Institute. No portion of this article may be reproduced without its permission.