Karofsky: the "Slots" of Succession
by Shel Horowitz
"Every so often, call time out and say, 'where am I, where am I going, do my strengths and skills match the needs of the business?'" This sage advice comes from Paul Karofsky, director of Northeastern University's Family Business Center and a principal with Transition Consulting Group, in Weston, Massachusetts.
Karofsky's talk at the Family Business Center of Pioneer Valley's September 2002 meeting was called "The Rights of Passage: A Guide for Leadership, Assessment and Succession." As you might guess from the title, the presentation covered a lot of ground. In dealing with succession planning, as in many other aspects of running a family business, "conflict is unavoidable. The trick is learning how to manage it."
One of Karofsky's key tools in managing conflict&emdash;and expectations, planning, and a host of issues - is the SLOT analysis. You may know it better as the SWOT analysis: Strengths, Weaknesses, Opportunities, Threats - but Karofksy jokes that "weaknesses are politically incorrect" - so he's changed weaknesses to limitations. After giving everyone a chance to fill out the worksheets, pairing up older and younger generations of the same business, he asked for report-backs from several participants.
Peter Haas, president of Hillside Plastics, saw the company's strengths as an ability to change over machinery quickly, a diversified customer base, and in being an "honorable" company. His father, Dick, who led the company until four years ago, saw Peter's leadership, product quality, and market position as key.
For Pat Turley, of Turley Publications, what limits his company is that "we're a little short on our long-term strategy." His son Keith is pushing against a conservative growth model; "we have to look outside for opportunities."
Other business owners shared the opportunities and threats. And then the conversation turned to how to develop leadership, and how to pass the baton from the older to the younger generation (something both the Haases and the Turleys have already managed). It's crucial, says Karosfky, to pick the right successor. "Just having the right last name doesn't guarantee that you will be a successful leader.
"One of the reasons we're asking the senior generation to comment on the younger generation is that one of them may be CEO one day, one may be chief custodian. We want you to sit down with the younger generation and say, 'this is how you see yourself, this is how I see you.' Use this format for performance evaluations: what am I doing well, what do I need to change, what am I going to do about it? It requires enormous dialog between the generations and among the candidates of the younger generation, and to be able to have this dialog with each other. Then you come back and look at yourself in the mirror and say, 'what am I going to do about it?'"
And a factor for the up-and-coming generation is the expectation of a truly meaningful career. In the old days, Karofsky said, people didn't necessarily expect to be happy in their career, and they did expect to be working for one employer for all or most of their careers. However, now, "the younger generation had darned well better like it, because if they don't enjoy it, they won't do it." Now, even satisfaction is not enough; you need "passion; dead fishes aren't going to make it. It's got to be real and sincere and genuine. You've got to love it."
Karofsky's key advice to the younger generation: "Power is not granted by the senior generation, but taken by the younger generation. I'm not encouraging insurrection, but it's your responsibility, your obligation to march forward and make your case - this is part of the initiative that the senior generation wants to see from you in the first place! But if you're not meeting the needs of the senior generation, the senior generation will never let go. It's the younger generation's responsibility, it's all on your backs to see that the moms', dads', aunts', uncles', and grandparents' needs are met."
And to the older group? "Values start with stories. . Quoting noted family business consultant and author, Fredda Herz Brown, Karofsky said, "Stories are the fabric from which a family is woven"; you've got to share them with your kids. That's how they're going to get their values.