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Tuesday, Nov 28, 2023

More Women Take Control of Family-Owned Firms

More Women Take Control of Family-Owned Firms By JACQUELINE FOX Staff Reporter When Carol Davis launched her company 32 years ago from her dining room table, she was bucking trends left and right, not just because she was a young mother entering the workforce for the first time, but because she was starting her own company. “What I did was not so popular in those days,” says Davis, chairman and chief executive officer of Calabasas based-Davis Research LLC. “When I first entered the workforce there were very few choices for me. I could be a nurse or a teacher, but that’s about it. But I wanted to work and have a family both. I’m the kind who would have put the crock pot on the stove before storming the gates at the White House to join in a protest.” Today, Davis Research is perhaps one of the Valley’s oldest family firms started and run by a woman. And Davis is now a veteran member of what is considered to be one of the fasted-growing segments of American business, including those that are family owned. According to a recent survey of roughly 1,200 executives at family owned business across the country, 34 percent said within the next five-to-seven years their next CEO could be a woman. That figure is up from only 24 percent in 1997 and is expected to keep rising, according to the survey, published by Raymond Institute, a New York consulting firm for family owned companies. Clearly, cultural and generation shifts have resulted in larger numbers of women entering the workforce since the 1970s, including those who have gone on to work in the family business. As a result, there are more women vying for and getting top-level posts. Home-based businesses The numbers are also growing due to advances in technology that allow female entrepreneurs to run home-based businesses. In 2000, for example, a national study placed the number of the nation’s female business owners at over nine million, according to the Women Presidents’ Organization, which has chapters in Los Angeles and nationwide. California has roughly 746,000 women-owned firms, representing roughly 1.4 million workers and $200 billion in sales, according to the Center for Women’s Business Research. “When we first started, we didn’t even have a fax machine,” said Davis. “So I can’t begin to think what it would have been like for women then. I’m sure there would have been more of us getting into the fray.” Advances for women in education and shifts in management trends are also playing a role. “If you look at related research, women are getting much higher scores in schools than men, and that’s one thing that may have companies, family owned or not, seeking out women to run them,” said Rosa Carillo, who owns Long Beach-based Carillo & Associates, a consulting firm for Latino entrepreneurs. She is also an associate with Glendale-based family business advisers, DoudHausnerVistar. “The workforce is also getting much more insistent on taking a more democratic approach to management. Men are used to a command and control approach, and women have traditionally been more sensitive to getting what they want by going around that train of thought. So they are more attractive leaders to many of today’s decision makers and those they employ.” But as Davis and other female executives will attest to, it takes a certain type of women to run a company, whether it employs five or 500, and whether there is a family legacy involved, or a corporate giant to answer to. The challenges are far more complex, the days are longer, and it can get just as lonely at the top for a woman as it can for a man. “I’d say to any woman contemplating taking over the family firm, or going into a company as an outsider, that if you are going to have both a family and a career, you may need a ‘wife,”‘ said Davis. “I had to get help. But, instead of running the company and coming home and doing the toilets and tubs, I got to spend my time with my kids.” Knowing the business As is the case for any man, women in line to run a family firm need to know the company from every angle, even if they’ve been managing the accounting department since they graduated from college. Successful successions, say the experts, result from replacing the CEO with a knowledgeable, well-respected family member and not simply the family member next in line. Nancy Gump and her father, Barry Gump, owner of Andy Gump Temporary Site Services in Santa Clarita, have been discussing her eventual take over as CEO and general manager. Nancy, 34, has worked for the company for 15 years and is the current special events manager. As an only child she stands to replace her father when he retires. But the two agree she’s not quite ready to take over the reins just yet. So they recently established a five-year plan to allow her to work in every department in the company to get to know the business, its people, vendors and associates, from more than just one perspective. “I truly believe in what we are doing and I can’t imagine walking away from our family name,” she said. “But I have three small children at home and want to finish my schooling in business administration first, and I want to learn the company from the ground up before jumping in.” Gump said she’s hired a supervisor to learn and eventually take over her position so that when she begins moving into other departments, her replacement will be able to hit the ground running. “It’s very important to me and my father that we not just make the transition because it’s the obvious one,” said Gump. “My dad thinks this is a good five-year plan. He says he’s got about 10 years left: five to give it all he’s got and another five to start easing out. So this is a plan that will allow him to do that comfortably and allow me to step up to the plate with what I need to give it my all.” Tips for Women Leading Family Firms – Be clear about your personal vision. What kind of career goals do you have? How will running the family firm further those goals? Be aware of your motivations are you considering this largely out of family obligations? – Leverage personal and business networks. Talk to other women who run businesses, especially family businesses. Find out and learn from their experiences before you make your final decision. – Superwoman is a myth! If your current job in (or out of) the family firm and your family obligations leave you with little or no extra time, you may want to consider postponing your transition to leader to a time when you have a better balance and are set up for success vs. burnout. – Know what it takes. It’s lonely at the top and it’s lonelier at the top of a family business because going home to talk to your family isn’t always possible. Understand and make sure you have both the business competencies to do the job and the wherewithal to deal with the demands of family owners, who may or may not work in the business. Source: Rachel Mickelson, partner at DoudHausnerVistar

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