Meredith Moore hosted Kirk McMillan on the June 24, 2010 Family Business Radio’s weekly program, while her co-host, Pat Romboletti, was out of town. Kirk is the former president of Twelve Baskets, a business founded by his father that is one of the leading wholesale food re-distribution companies in the Southeastern United States.
As with many children of families who own businesses, Kirk started in the business as a youngster. One of his first duties? Picking up and taking out the trash. When he formally joined the company, he began in accounting which his mother ran at the time. From there he moved to the President’s position where he took control of management development and strategic planning.
Not surprisingly, a mission statement is near and dear to Kirk’s heart. Like no other document, it establishes a common understanding among the family and employees about what the business provides to their chosen industry. Kirk warned against using cookie-cutter mission statements. He thinks you get into hot water pretty quickly when you put out a mission statement and then don’t abide by it. “But establishing a mission statement encourages the process, the conversations, so everyone is clear on the purpose of the business,” he said.
Kirk went on to list the three essential parts of a successful business, all of which he thinks provide vital feedback—both positive and negative—that a business needs.
- A strategic plan. It starts with a mission statement that needs to have clarity of purpose. A business also needs a feedback mechanism that puts processes in place to tell you whether you are achieving that purpose. Another important element is a business’s ability to adapt to the feedback—how it is used to make corrections, to further the long-term goals.
- Board of Directors. These are the (hopefully) outside people who bring their experience and expertise to guide the business. They keep you accountable and are responsible to the shareholders. Kirk suggested they need to meet 3-7 times a year, but cautioned that you don’t want to get to the point where the board runs the business. He encourages businesses to install a board as soon as possible to help avoid the “leadership crucible,” where the founder has to continually make high-stress decisions that leave them feeling isolated.
- Family meetings. This formalized structure gives the family a voice where they have an opportunity to ask: as shareholders, are we getting our needs met? Kirk thinks 2-3 meetings per year are sufficient
Kirk recently left Twelve Baskets. Currently working on his doctorate at Kennesaw State University (and taking full advantage of the access it provides to the Cox Family Enterprise Center), he continues his involvement in family-owned businesses with his doctoral research, which includes working with the very definition of a family-owned business and what makes them different from other businesses. His research has him working with terms like family orientation, or the characteristics that make up the family—their functions, strengths, what orients them in running the business together. Also the family influence scale that looks at the power, experience and control the family has in the business. It gauges how the family permeates and impacts the organization, which makes culture one of the largest factors in the scale.
Speaking from personal experience, Kirk advised to allow plenty of time for succession, a big component of which is mental preparation. “It was about a five-year process for me,” he admitted. First came the emotional preparation—why do I want to leave? Why do I want to stay? Are the tasks required of me on the job meeting my intrinsic needs? What are the personal aspects? How will the family be impacted? This portion of the process went on for about two years for Kirk.
Then came the conscious decision to make a move, followed by relinquishing control. “We went through a co-presidency for a year. It involved my brother taking on new responsibilities, which also said explicitly to the world that we were making this transition from me to him,” he explained. From that point, he moved to CFO for a year. And then he was out the door and on to his next adventure.
As to how to define a successful succession, Kirk believes that ultimately it is more art than science. “Business is art,” he said, “and success is often in the eyes of the beholder.”
You will gain a wealth of knowledge by downloading the full podcast. Kirk has many “lesson’s learned” and an abundance of insights unique to a family business from the perspective of someone who has been the part of a very successful one.