QuickBizBreak by david weaver

A few years ago, I was at a neighborhood party talking with friends. Sounding too much like the intro to a bad joke, a CPA, an attorney, and a business succession planner gathered at the bar where the conversation quickly turned to a discussion about family businesses. I was shocked to learn that the attorney, whose dad had passed a couple of years previously, was no longer on speaking terms with his brother who lived no more than five miles away. He spoke of the great relationship they had shared their entire lives but when it came to dividing up their dad’s estate between the two of them, his brother became greedy to the point of wanting more than was stipulated in their dad’s estate documents. My neighbor initially balked but in the interest of maintaining family harmony, acquiesced to his brother’s wishes. Unfortunately, the damage was done, and they became estranged.

Unfortunately, this is but one of several scenarios that we encounter as a business succession planners working with closely-held and family owned businesses. It may be differences between siblings, cousins, in-laws or between parent and child but the results can be devasting for family relationships in any of these scenarios. It may begin with some small incident that escalates or a series of decisions that never gets resolved due to differences in perspective or opinion but regardless of the trigger, it can lead to devastating results for families and the businesses they own. A few of the more flagrant issues we see include the following. 

Money

The old adage says that ‘Money is the root of all evil’. While this certainly is not the norm (there are many families who handle wealth with grace and constraint) wealth can tend to bring out feelings and emotions that were otherwise dormant when we find ourselves staring at large estates and assets. This is especially true with new wealth as a result of the death of parents or unrealistic and/or unearned high income for the position held. The easiest answer is to not let money be the sole driver or motivation for work. The most successful business owners and families I see are the ones who recognize their stewardship responsibility to help others succeed.

Power or Control

For some, the ultimate power trip is power itself. The ability to control departments, organizations, or other people (including family members or partners) can run strong for those with high dominance as their main behavioral trait. Not content to collaborate, it can be ‘my way or the highway’ for some of these strong-willed leaders. Their lack of humility usually gets the best of them as they see themselves as doing most of the work and providing most of the wealth through their singular efforts. Recognizing that success is a team effort and that part of motivating and developing others is allowing them make decisions on their own is a great first step. Learn how to delegate and allow others to learn from their mistakes. Successful businesses are the ones that can run without a leader’s constant presence and input. Besides, you will never be able to retire or take a vacation if you believe the entire business revolves around you.

Jealousy

Jealousy can be found anywhere that family members are intent on comparing themselves to others, whether it be other family members or perhaps those in similar positions or businesses. This can be somewhat typical between siblings who lock onto anything that might prove to be differentiating factors, from who entered the business first (‘I started first so I should be in the position of leadership’) to who is working the hardest or producing the best results (‘I work harder than my brother so therefore I should be the one rewarded with stock ownership’). Jealousy can also be common between in-laws. Brothers, for example, might work diligently together to run a successful operation while their wives are in competition to see who has the biggest house, the most recently redecorated resort condo, or the newest car. By the way, the guys are not exempt from this comparison!

Jealousy is a dark companion and can begin with an unreasonable and unsustainable feeling of personal inadequacy. One of the most important and most difficult lessons in life to learn is that we can never be happy if we are not content with what we already have. Certainly, there is nothing wrong with striving for greater success and indeed, those motivations tend to drive performance, but we run into problems when success becomes a substitute for happiness, either as a driver or as a reality. Finding happiness where we are or in the direction we are heading to better ourselves keeps us authentic without worrying about what others have or what others think about us.

Conflict

Some conflict is normal between family members working within a business but constant conflict, especially that exhibited by outbursts and anger, are sure signs of dysfunctions within the family. These types of behaviors easily create tension and resentment within the family which can be difficult to resolve without counseling. This is by far the most common element of family members working together that we find. There are many avenues for overcoming conflict. One method is to develop covenants between individual family members (or any two parties of unequal standing) that outline expectations between them. What do I need from you? What do we do when we experience conflict? What are your expectations of me? This can include behaviors as well as operating expectations. Another element to avoid conflict is to develop a key word or sign, such as raising one’s hand, that tells the other that we need to take a break and address the issue after a cooling down period. This prevents outbursts or escalating arguments, especially in front of others. Weekly meetings to address matters of importance can also be a great way to table issues until you can meet behind closed doors. Open communication is the key to understanding what is going on, not only within the organization but also with partners and key personnel. You cannot over-communicate!

There are no easy answers when there are dysfunctions within a family or behaviors that tend to drive relationships off course. If the issues described here are the result of compensating behavior for lack of love as a child, unrealistic expectations from parents, abuse, or other serious behavioral issues with deep-seated causations, they are best addressed with professional therapy. Certainly, if behaviors are a result of addictions, there is a need for professional intervention and treatment. In most situations, however, the realization of one’s own tendencies and behaviors can be the beginning of finding a greater peace and balance within family relationships.

Ultimately, though not always easy, it is best to determine everyone’s gifts and skills, and place them in the role that best utilizes those traits for the good of the company. Provide training and development to keep family members growing and succeeding. Schedule weekly meetings, sometimes referred to as a Family Business Council, to openly discuss not only business issues but how the family is doing working together. Establish expectations and review them regularly. If caught in situations that are not healthy and appear to be escalating, call a time out and agree to discuss at a later time. These are a few ways to get the ball rolling to ensure that families can enjoy their time together both within the business and outside of the business.

I moved from our old neighborhood a few years ago and upon following up with my old friend and neighbor recently, I was saddened to learn that he had passed away after battling cancer. I asked his widow if he had reconciled with his estranged brother. Fortunately, the illness brought them back together yet without any acknowledgement or apologies for what may have started the initial tiff between them. And perhaps that was the way it should have been. No finger pointing and no blame. It would appear that both brothers realized the most important factor within families, whether working together or not: unconditional love. When someone’s life is on the line, we often recognize the insignificance of the battles we incur for the benefit of ourselves, not for others. My advice: don’t wait for someone’s life to be on the line; act as though it already is! If you recognize these behaviors within your family or within your family business, seek guidance. There is no business (or personal) gain worth a family loss. Look at yourself in the mirror and ask yourself if there would be any regrets in your behavior if you lost a loved one tomorrow. Run your business with passion but also with compassion.

A few years ago, I received a call from a successor candidate we had been working with for the past couple of years. This dealer’s son was an exceptionally bright, hardworking lad with lots of promise. Before coming to work for his family’s business, he spent a handful of years in another dealership, earning respect, experience and the kind of humility that comes from working somewhere that does not display your last name on the building. He had learned what makes the various departments click (as well as exposure to what didn’t work), the structure and process, how to read the financials and other key performance indicators.  Now working for his family’s dealership, he had proven himself as sales manager to the point of earning his current role as GSM. The managers respected his leadership and other than the typical over-exuberance for immediate change, the successor was continuing his development to someday buy out his dad and become the dealer. All appeared well until I received his call.

It isn’t unusual to listen to a clients’ concerns and let them propose solutions for handling a stressful situation and this was no different.Coming off the heels of an industry conference, the successor was overwhelmed by information taken from workshops and expressed his anxiety over the future of the car business and the impact on the future of his family’s business. He shared his grave concerns about the dealership location, lack of room to expand, reduced net on new cars due to volume pricing requirements, monitoring and qualifying for ever-changing manufacturer incentive programs, problems finding and keeping techs and on and on. Let’s just say I let him go on for a few minutes. After he stopped for a breath, I thought of lightening the mood a bit by asking, ‘And the problem is…what exactly?’ However, not wanting to minimize his concerns, we reviewed the work he and other managers had been focusing on to minimize outside uncontrollable issues (threats) and targeting those they could influence. In other words, basic strategic and operational planning.

This young successor’s concerns were valid given the time, financial and emotional commitment it takes to one day become a dealer-owner. However, this young successor’s concerns are similar to what I hear from mature and experienced dealer’s across the country due to changes impacting the industry.  Many dealers are now fraught with concern about the future of autonomous vehicles, shared mobility and what that might mean for fleet sales directly from the manufacturer. In addition, the expansive growth in EV development across entire manufacturer offerings is creating a lot of questions about what that means for reduced maintenance and the additional investment in training and facilities to meet the eventual shift to a more electronics-centric service department. Of more immediate concern are ongoing tariffs, trade wars, and the shift of buyers to SUVs and crossovers leaving dealers with unsold sedans. On top of all this, lets factor in reduced dealership values, cited in both The Haig Report and Kerrigan Advisors’ Blue Sky Reports.

As Greek philosopherHeraclitusis reported to have said, “change is the only constant in life” and dealers, perhaps more so than most business owners, know this. They have been through recessions, manufacturer bankruptcies, parts disruptions as a byproduct of everything from Pacific earthquakes to labor strikes, and natural disasters in our own country with storms, floods, and hurricanes. These represent temporary disruptions, however, and some of the manufacturer developments today are more far-reaching. The solution, however, has not changed so much and that is planning for the unknown by working on the known.

With long term planning, we recognize there will always be some elements that are out of our control; the economy – both local and national, interest rates, manufacturer’s products and program requirements, and competition, just to name a few. Yet there are many issues that are facing dealers which can and should be addressed in planning sessions, even for those who primarily focus on monthly and quarterly results. Unfortunately, some dealers take a wait-and-see attitude and by the time they recognize change has hit the market, it’s too late to respond successfully. While walking through an entire strategic planning process is beyond the scope of this article, taking the first steps towards long-term change means assessing your business, defining what is working and what is not, along with what is under your control and what is not. Identifying opportunities for positive change while preparing for changes in markets and other variables, is a start in the right direction. One of the biggest issues we run into are businesses that have kept with traditional approaches for so long that owners and managers are not open to change. Doing things the same old way just does not cut it any longer. Navigating into unknown waters with leaks in the ship is not a good start, so getting ship-shape by assessing business performance, evaluating managers, developing staff, and focusing on areas of improvement now rather than later is key.

While successors may still have concerns about investing in our industry given the many unknowns, many are also helping to lead the planning process, pushing to look beyond traditional dealership models into business diversity. Whether that means investing in real estate, expanding their pre-owned vehicle footprint where they have more control, adding commercial car wash facilities, or bringing third-party supplied services in-house to control costs and boost profits, they are anxious to be part of the process in molding the future of the business.

Owning and operating a dealership is a time-consuming, capital and resource-intensive endeavor that requires focus and constant monitoring. Questioning the long-term legitimacy of a business and whether one has the fortitude to withstand change is a valid exercise. Whether a seasoned dealer or a young successor-in-training, getting through the next decade during uncertain times will provide a challenge, but those who navigate successfully will once again emerge stronger with the knowledge they have what it takes to ensure the success of the business both now and into the future.

One of my favorite quotes is ‘If it wasn’t for dealing with people, this business would be a lot of fun!’. People are by far, one of the most challenging issues of running a business. Although the tongue in cheek quote is most likely aimed at the rare customer or employee situation, it is the challenge of finding great employees that presents a more realistic challenge; ones who will work hard and are a good fit with our culture. While most every business faces that challenge, what is the challenge that is specific to family business? Quite simply, it’s family.

Different Standards

We often talk about the family business oxymoron. Simply stated, individuals are generally accepted unconditionally in a family based on love while within a business, individuals are accepted based on performance. The problem begins with employed family members, as both of these factors are present. They are accepted within a family even if they occasionally screw up but within a business environment, there is a performance expectation just like any other employee or manager. We sometimes give our family members a pass when it comes to meeting the same performance standards without realizing what a disservice that is to them and to others within the dealership. If we accept different standards for our family members, then it calls into questions the standards for everyone. Plus, if family members know they will not be held accountable to similar standards, it breeds and feeds other behaviors that are not welcome in a business. Sometimes, even if we do hold family to strong standards, their natural behavioral traits do not allow them to accept these requirements.

Attitudes and Behaviors

Even if family members are stellar performers, they can bring attitudes and behaviors that are unbecoming, and which can undermine the attitudes and performance of others within the business. Additionally, they can negatively affect family relationships with parents, siblings, cousins, or others who either work at or have an ownership interest in the dealership(s).

Four Common Traits that Derail Relationships

Each of us brings our own beliefs and values to work and whether good or bad, they help form our attitudes and thus, our behaviors. While certainly not inclusive, we see four common attitudes that often derail relationships with family and with co-workers. With family, it tends to be issues of Ownership– wanting it all, and Control– controlling it all, often to the exclusion of other family members. As family members progress up the ranks, it is natural to begin expecting some percentage of ownership in the business, either by gifting or sale of stock. At some point, usually sometime after ascending to the position of GM of a single point or Director or president of a multi-point corporation, some expect to have full ownership. We have to keep in mind, however, that many parents continue to rely upon stock distributions from ownership to fund their retirement. While there are many ways to address this issue, demanding full ownership is not a way to endear one’s self with a parent.

Even clearing that hurdle, however, does not prevent one from wanting control.  The oldest child (or cousin or other relation) comes into the business and begins gaining experience. When the next family member enters, it is easy to assume they will always take a subordinate position to the first. As a client related one day, however, ‘ten or twenty years down the road, who cares who started first?’. Siblings and other family usually bring different skill sets that are often complimentary. Learning to utilize everyone’s skills and natural gifts is a basic tenant of servant leadership. The sooner we adopt that attitude, the more quickly we can learn to work together for the greater good of the business, our employees and our families.

There are two traits that tend to drive these expectations of Ownership and Control and those are Ego– knowing it all, and Entitlement– expecting it all. Ego is driven by what others think of us and some of us need our egos fed more than others. This may be manifested by a need to always be right, always win an argument, or always exert control. A little ego can be good, it provides confidence. But over-doing it in this area is a fast way to have subordinates and other family members simply roll their eyes and then do their own thing. Unearned entitlement is one of the more challenging traits. The other three discussed here can generally be managed with coaching but overcoming an entitlement attitude is a more difficult task as it can mask greed and arrogance, truly unlikeable traits. It is extremely difficult to lead well with an entitlement attitude and there can be a strong reluctance to listen and learn, key elements to developing an awareness and improvement of behaviors or attitudes. As one of my business associates likes to say, ‘If you see a turtle on a fencepost, you know someone put him there’.

Improvements in any of these areas takes time. Some general areas to work on include showing an interest in others, listening and asking questions. Getting to know those around us helps to form a better understanding of people and circumstances, fostering greater understanding. We learn from those interactions which also helps us gain experience. That experience over time helps us gain respect, a critical leadership trait. Although not an absolute, we have found that one of the more remarkable traits in leaders that helps with all relationships is humility. C.S. Lewis once penned, ‘humility is not thinking less of yourself but thinking of yourself less’. A feeling of entitlement can contribute to prolonged conflict, both with yourself and with others, so clearing that thinking helps clear impasses with others.

People will always present challenges and remain one of the most demanding facets of running a business. Understanding key behavioral elements that work within the framework of a family business, recognizing them in yourself and how best to address them, allows for a more productive and harmonious environment both inside and outside of the business. And that makes dealing with people a bit more fun!

Last week, I wrote about the importance of long-term planning as it relates to succession planning. In our experience, long-term planning provides a proven benefit which is building value in your business. How you ask?

Succession planning covers a broad range of subjects which may be broadly categorized by legal, financial, and people. Each of these can be broken down into subsets such as estate planning, contracts and business structuring, personal and business finances, strategic planning, leadership development, strategy and performance, successor identification and development, and partner/family dynamics and governance. These can be even further broken down into more finite categories as each business is unique along with each owners’ perspective and motivation. Each of these many facets of succession are intimately woven together, interdependent upon each other’s outcome.

Value

A franchise operation is valued on a number of factors: tangible assets, profitability, the terms of the franchise agreement, location, allocation of goodwill between franchisor and franchisee, and many other factors. There are a number of criteria, however, that factor into how an operation is run, how employees interact with one another and the public, and how successful they are in running any one or multiple franchise locations.

Succession Factors Effecting Value

The easy answer is that all of the succession factors involved are key to driving value in the business. An Owner’s Motivation and Perspective shapes the culture of the business and helps determine their stewardship responsibility to employees, community, vendors, suppliers, and more. This sometimes is driven by the franchisor (Chik-fi-A comes to mind) yet others are driven more by the culture defined by local ownership and management. Personal Financial Planning determines whether an owner has, or will have upon sale, the assets to maintain their lifestyle without interfering with operations if there is a buyout arrangement or sale to a family member where they may be reluctant to hand over the reins. It also determines what happens upon the death of the owner by defining the codicils of wills and trusts in the estate plan.  Business Structuring defines the ownership structure, cash flow, liability protection, governance, and management control. Business Performance is an obvious component of business valuation but also to maintain productivity and profitability during a change of ownership or management. Strategic Planning provides detailed action agendas for the implementation of structure, processes, and people critical to fulfill long-term succession goals.

Leadership and Management Continuity addresses the need to identify, motivate and retain key leaders and managers who help drive the organization. Management Synergy and Teamwork addresses the need for collaboration of talented and motivated people to carry out the mission and vision of the company on a daily basis. Whether your franchised business is family-owned or with partners, the Family/Partner Dynamics and Governance addresses the relationships and communication necessary for the continuity of the business and in establishing the structure, operating policies (if not defined by the franchisor), and accountability required to maintain business and cultural success. Lastly, if not selling to an outside party, Successor ID and Preparation helps ensure that whether a family member, incoming business partner, or ownership team, ensures that they possess the capacity, commitment and competencies to continue driving the success of the business.

Now re-read the last two paragraphs through the eyes of a potential buyer. While some buyers look for under-performing franchise locations so that they can improve operations and add value, not everyone is a turn-around specialist. Note that the list of succession planning criteria goes well beyond operational efficiency. We have found that many, if not most buyers, view a business that has successfully addressed the extensive issues related to succession planning as outlined above, and continues to review and fine tune each of those criteria, represents a high-performing asset that will continue to operate effectively and profitably under new ownership. This is contingent upon maintaining the culture, management team, and the many other factors that contributed to the success, which of course is not always the case. The value of the business as it relates to the sale, however, remains more favorable than one that does not address these issues. And what if you don’t sell to a third party and instead mentor a family successor candidate or embrace some other closely held ownership scenario? That same process helps ensure the continued success of the business through the next generation of owners and managers. And that, as they say in the credit card commercials, is ‘priceless’!

We often hear the term ‘planning with the end in mind’ yet in business, we rarely know what ‘the end’ really means. As a franchisee working hard to grow your business, it may be difficult to think from an ‘end game’ perspective regarding what you ultimately want to do with the business when you wish to cut back on your time and commitment and retire. Does that mean selling out to another franchisee or investment group? Does it mean a management buyout? Are there family members involved (or potentially involved) in the business who may be capable of taking over? In any of these scenarios, how do you manage the process of preparing for the sale or transfer of ownership? Do you even know if and when you want to start cutting back or exiting the business?

All of these are legitimate exit strategies, yet most would believe that the last question must be answered first. The problem with that notion is that since most business owners do not know if or when they want to cut back or exit, they never start planning for that event. ‘I’ll think about that later…when I’m older…or closer to retirement’, is a common sentiment. I could attempt to play life insurance salesman and ask, ‘Yes, but what if something were to happen to you?’, yet most of us go through life wanting to ignore the ‘what ifs’. But what if (see, there is another one!) I told you that planning for your exit and/or succession will help your business thrive and drive the value of the business at the same time? In this scenario, it becomes a win-win regardless of what you wish to do with the business when you exit.

In planning discussions, we hear from many clients that believe long-range planning is no longer valid as markets move too quickly, they cannot anticipate economic cycles, market disrupters, or other factors that might impact their planning. While I understand the sentiment in some businesses, franchising may be viewed a bit differently. For example, while a recession reduces spending power and consumer confidence, past recessions have proven that people still eat out, they still get their cars repaired, and they still order floral arrangements. People are still willing to pay for convenience. New concepts may come and go but the strong ones, much like a good stock portfolio, will continue to grow over time. A franchisee may hold development rights for an agreed upon number of new locations which requires planning, financing, acquisition, and construction that outlasts short-term cycles. The bottom line is that if you ignore long-term planning, your likelihood of long-term success will be minimized in the long-haul as you become reactionary rather than proactive in business decisions.

Part of long-term planning for the company includes anticipating changes in management structure over time and part of that change includes you. We have worked with clients who say they never wish to retire. Obviously, at some point it makes sense to turn over the reins and the good news is you don’t have to set that time frame if you don’t have a strong sense for when that may happen. You do, however, have a responsibility to the organization to prepare for your eventual exit.

Stay tuned for Part II of Franchise Planning – Why Planning Your Exit is Critical to Growth and Profitability, available next Thursday!

I recently wrote an article about managing one’s business as if it were always for sale. One of the key points was getting management proficient at running the business successfully in the owner’s absence. But what about management’s absence?

A recent article in the Chicago Tribune points out the results of a new survey released by Travel Effect, an initiative of the U.S. Travel Association. The article references the report, “Overwhelmed America: Why Don’t We Use Our Paid Time Off?”, stating that 40 percent of American workers will leave paid vacation days unused at the end of the year. Reasons given included the ‘dread of returning from a vacation to piles of work (40 percent), the belief that no one will be able to step in and do their job while they’re gone (35 percent), not being able to afford it (33 percent), and fear of being seen as replaceable (22 percent)’.

Roger Dow, president and CEO of the U.S. Travel Association, notes that “Americans suffer from a work martyr complex. In part it’s because ‘busyness’ is something we wear as a badge of honor. But it’s also because we’re emerging from a tough economy and many feel less secure in their jobs. Unfortunately, workers don’t seem to realize that forfeiting their vacation time comes at the expense of their overall health, well-being, and relationships.”

Not taking vacation time also creates a negative effect on our work performance. The article points out that ‘Living a life in which we work all the time and never prioritize recharging, simply isn’t sustainable — not for individuals and not for companies. Other studies have shown a direct relationship between vacation time and improved performance.

While the majority of industries are impacted by the work martyr complex, the auto business (and retail in general) is even more demanding in that it typically mandates long days and six-day work weeks. Those in sales positions are measured monthly on production, those in service are measured on their work and production while also dealing with unhappy customers. Managers are focused on the bottom line on a daily basis and relationships between departments are sometimes strained. All this adds to stress, which takes its toll on performance and health. The bottom line is we need time away to recharge in order to regain our focus and maintain a healthy attitude.

Unfortunately, business leaders send mixed messages about taking vacation time.  The Travel Effect study found that even though 95 percent of senior business leaders say they know the value of taking time off, they either don’t formulate vacation policies or don’t communicate those policies well. Even when they take vacation time, most managers are still working by phone and computer throughout their ‘time off’. While some feel their absence provides proof their department can operate without them, making them disposable, many are afraid their department can’t function at all without them. We hear this often in our interviews with managers. They haven’t mentored or trained anyone as a successor so there is no one with the knowledge or experience to handle their duties.

The question one might want to ask is, if managers don’t believe anyone can run their department for a week or so while they are on vacation, what happens in the event of a severe illness or incapacitation? What happens if they leave for another job? A manager who has confidence in him/herself and their staff while they’re gone, will create a staff who also has confidence in themselves. In an empowered environment, if there were to be a long-term absence of a manager, the business would be able to run more smoothly.

Bench strength is an important succession factor that needs to be addressed for each department covering every critical function within a business. Without depth of management, we leave it up to chance that a department may run into serious problems without their manager. Besides, by giving your managers the confidence that they can take a vacation without fear of replacement or departmental meltdown, they will feel encouraged to take time to recharge during the year. Remember, bench strength is a succession asset that also allows your managers (and employees) to recharge, rejuvenate, and perform well!

In our Part I installment of Mining for Millennials, we talked about the characteristics and expectations of the millennial generation. Those included focus on self, a work ethic that supports their lifestyle not the work itself, and a general feeling of entitlement along with anxiety from unmet expectations. So how do you embrace this generation and what they have to offer while not upsetting the existing ‘old school’ culture that has worked for so many years? Read on!

Let’s begin by defining what is important to millennials. If we can find a match with our own culture, then we can create a win-win for all generations involved.

First, millennials like working with other millennials. If making your first millennial hires, this might appear a hard sell. Find someone who is motivated, show them a path to success, and they might be helpful in attracting others closer to their age to follow them into the business.

Second, millennials like feedback and I’m not talking the annual review type. Continued feedback allows them to monitor their direction, progress and success. Setting expectations, holding everyone accountable, and guiding performance based on feedback creates a high-performance culture. Everyone benefits from better communication so working this into your system can be a positive for the entire organization.

Third, this age group embraces flexibility. In a recent PWC survey, only 29% of millennials said they expect to work regular office hours while 81% believe they should be allowed to make their own hours at work. If we had ‘extra’ employees, we could create some overlap that provides coverage for time off. Yet at a time when finding good employees is already a stretch, techs complain if they don’t get enough hours, and we are trying to keep expenses down, this can become a trifecta challenge. Start by setting clear, written expectations for work performance. To earn extra time off for sales, it might be quota-driven with mandatory sales meeting attendance. For other areas, such as fixed ops, it may take the form of trading hours with others who can fill in the gap. Finding ways to work this into other areas of the dealership will require feedback from all managers, helping develop a more flexible work environment.

Fourth, millennials appreciate opportunities to learn. Make sure you communicate a clear path of training, ongoing support and development and then deliver on that promise. Show them how what they are doing today will help them succeed in the future by tying the job skill to their eventual career goals. Discussing a candidates’ career expectations should be a standard job interview policy, regardless of age.

The fifth area of interest to millennials is purpose. According to Jean Twenge, author of Generation Me, ‘not feeling that a company had a purpose is the number one reason millennials quit their jobs. They do not feel a connectiveness at work around something greater than the job at hand’. Twenge suggests allowing volunteer time so that millennials don’t have to ‘park their values at the door’. Showing how employees create value for your customers while helping to create a better community through dealership programs, volunteer days, sponsorships and more can help millennials scratch this itch.

It helps to also recognize that helping others is not universal to this younger generation, but to all generations. Establishing a Mission and Vision for the organization helps define both why we do what we do and where we are headed as a company. This allows everyone to get on the same page and feel they are part of something larger than earning a paycheck.

Regardless of accommodations that may be made for millennial workers, they still have to pay their dues, be treated like any other new employee, and work their way up the ranks without any special treatment. ‘Going overboard may get them what they want’, says Twenge, ‘but not what they need for the long haul. What they need is a company that makes a profit and coworkers who don’t resent them for being ‘special’. Organizations who can find this balance will be more successful as millennials come to dominate the workforce in coming years.’

Ironically, this is the same advice we have been giving for years to successors coming into the business. The best way to earn respect is to perform well and not expect special treatment.

During this process, remember that just because you have done things the same way for so many years does not mean that change is a bad thing. Sure, you may get pushback from those who, like you, are probably use to 6-day a week, 10+ hour days. Change rarely comes without some hiccups along the way but progress takes work and cooperation from everyone involved. Get your team together, discuss potential changes and ask for feedback.

Millennials have much to offer and represent the future generation of leaders for our industry. Let’s help them discover the automotive business and develop them into the employees, managers, and owners they need to be for continued success!

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References: Generation Me, Jean M. Twenge, PhD; The Trophy Kids Grow Up, Ron Alsop

Finding good job candidates these days appears next to impossible. Blame a good economy which creates greater competition for jobs. Finding millennial candidates is even more difficult. A client recently told of his frustration of, after a long search and much vetting, hired a millennial job candidate. When the day came for her to report, she was a no-show. Adding to the frustration is that it was the second time this had happened. Was this a case of poor communications on the part of the dealer? Not setting proper expectations? In this case, the start date was clearly communicated and agreed to. As for setting expectations, most would agree that showing up is the bare minimum for a new hire.

Why target millennials when much is written about their contrarian work habits? It’s fairly simple, really. Your staff continues to age and eventually you will have to tap into the millennial market, which by 2020 they will make up 40% of the workforce, to bring up the next generation of sales, service, and office staff. And regardless of what you hear about millennials not being as excited about car ownership, you also want sales staff who can relate to this generation of auto buyers.

Another reason to understand millennials is that as your managers age out, millennials will eventually fill those positions as they advance through the ranks. If you are a family-owned dealership, you may well have kids that fall into this age group who represent the next generation of business owners. Understanding their viewpoint, lifestyle, and influences will give you a new perspective of future ownership as well as help create a positive environment that may be attractive for them to actually want to enter our industry. Let’s face it, the dealership management model and time requirement in a six or even seven day a week retail business does not represent a magnet for young employees. It can rob precious time to be with family, friends and for relaxation, a big issue with this age group. But first, let’s look at who is the millennial generation.

Those born in the 80’s and 90’s are defined by different names but generally, this age range can be classified as millennials. Under age 35, they represent the ‘me generation’, or as Jean Twenge tags them in her book of the same title: Generation Me. Twenge notes that they were raised on the premise to ‘’just be yourself’. Focusing on themselves more so than on others can lead them to be self-absorbed with the attitude ‘if it’s good for me, it’s good for everyone else’. This view plays a large part in their attitudes towards work. While Boomers tend to live to work, GenMe works to live, viewing their job as a way to fund the things they enjoy about life rather than finding joy in their work. In order to fund their lifestyle, they want high paying jobs but are not necessarily willing to work for it. In her research for Generation Me, Twenge found that millennials held expectations of the ‘best job with the most pay and the least amount of work’. Asked to name 5 qualities of their generation during interviews, ‘lazy’ almost always made the top five.

An aspect that we see most in our work with succession candidates (and this is not limited to the millennial generation), is unearned expectations, or in a word, entitlement. Millennials grew up in an era of praise and grade inflation, resulting in highly-positive self-views. Their expectation is that praise will continue after they enter the workforce.

Twenge found millennials’ over-confidence and impatience unfathomable at times. They believe that working hard in school means they are ‘entitled to a good job’. In one study, 40% of millennials believed they should be promoted every two years, no matter what their performance. Part of this behavior is fueled by attempts to treat all kids the same when they are growing up, regardless of abilities and accomplishments. In speaking with a dealer who was attempting to describe his kids’ entitlement attitude, he pointed to a generation that ‘expects a trophy for just showing up’.

Based on a study of 40,000 millennials, the reality of life, difficulty finding jobs that meet their expectations, along with not forging and maintaining close relationships, is creating anxiety and depression which is predicted to be a 15-20% lifetime rate (or higher) with this generation. Blame the social media environment in which they live that minimizes face-to-face interaction and close relationships. I was driving home from the airport recently and heard a radio segment where the hosts lamented the fact that young staff do not return pleasantries, not even a simple ‘hello’ when spoken to. They are not used to face to face contact with anyone other than close friends nor accustomed to the social structure of work relationships.

Before we blame millennials for crushing our work culture, we can thank them for some current trends. They are credited with the birth of casual Fridays (or everyday casual in some cases), flatter hierarchies, treating employees with greater respect, and a greater focus on work/life balance. The truth is that we do take less vacation than our European counterparts, ‘who place more value on enjoying life’. In fact, the U.S. is the only developed nation that does not mandate paid time off. I know what you are thinking: ‘heresy!’ Call it what you will, we need to adapt our work environment to attract this younger generation and in the process, we may just make everyone’s work lives a bit more enjoyable.

In our next segment, we will focus on how to address the issues outlined in this article in order to attract and retain the millennial generation worker along with how that affects the succession process.

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References: Generation Me, Jean M. Twenge, PhD; The Trophy Kids Grow Up, Ron Alsop

If I were to place one image here, a ‘swoosh’ that looks something like a happy go lucky checkmark, you would instantly recognize it – the Nike logo. You would also call to mind their slogan, ‘Just Do It’. My interpretation of that slogan is that they are calling us to just get started, get practicing, get swinging, get running, get physical, and enjoy life – using their products, of course!

Enjoying life includes enjoying the workplace since it takes up so much of our time but work can be a stressful environment. We work with all types of people in all types of situations. It’s easy to get stressed or upset when others react in a way that is in conflict with our own beliefs, established policies or they simply fail the common sense test. Of course, it’s not always ‘the other guy’ who creates the conflict. It could easily be us and we may not even realize it.

Either way, holding on to these ‘issues’ without letting go breeds resentment and stress, creating a caustic environment and a divisive culture. So if you find yourself in this situation, what can you do?

Some time back, The World Observernoted 15 things that will help you deal with issues that can make life, and in this case your job, a lot easier and you much happier. Here are a handful of those insights along with my own comments from a succession planning perspective:

• • Give up your need to always be right. So many of us can’t stand to be wrong. We always want to be right – even at the risk of jeopardizing relationships. This causes stress and emotional pain, for others and ourselves. Sometimes it’s a behavioral trait that drives us or it may be a harsh history that we continue to relive. As an owner or manager, give others the opportunity to make decisions on their own but don’t be judgmental when they don’t work out. Talk it over, allow them to learn from their mistakes, and move on.

• • Give up your need for control. The need for control is often rooted in fear, and those of us who need to be in control are looking for certainty in a very uncertain world. Since this will generally drive us crazy (and those around us, as well), learn to give up your need to always control everything that happens to you and around you – situations, events, people, etc. Remember, eventually you will not be running the show and you must prepare your successor(s) to function without your input and control. Learn to delegate and let go.

• • Give up on blame. Give up on your need to blame others for what you have or don’t have, for what you feel or don’t feel, or for what has or hasn’t happened. Granted, it’s not easy.If you told me of your difficulty, conflict, or mistreatment from someone, there is a good chance I would see why you would want to blame them but it does no good to do so. Find a solution, not a scapegoat.

• • Give up complaining. Give up your constant need to complain about those many, many things – people, situations, and events that make you unhappy, sad and depressed. Nobody can make you unhappy and no situation can make you sad or miserable unless you allow it to. If there are issues that need to be fixed, then fix them! Get your team together to solve problems together. It builds teamwork and promotes collaboration. At the same time, approach issues with a positive attitude. Your company culture is built from the top down, starting with you, and a positive attitude is contagious.

• • Give Up Your Resistance to Change. Change is good but if you’ve been running the business for 30+ years, it may be difficult to embrace. Markets change. The economy changes. Business models change. Competition changes. Businesses need to grow and sometimes evolve to survive and thrive. Change will help you move from A to B. Change will help you make improvements in your work, your life and also the lives of those around you. Just because you’ve done it a certain way for many, many years doesn’t make it the best way or even the right way. Ask for suggestions from your team. Embrace change – don’t resist.

• • Give up your excuses. A lot of times we limit ourselves because of the many excuses we use. Instead of growing and working on improving our business, ourselves and our lives, we get stuck, lying to ourselves, using all kind of excuses – excuses that 99.9% of the time aren’t even real. There are two kinds of people in the world: those who push excuses out of the way; and those who embrace excuses as a reason for not moving beyond obstacles. Which kind of person do you want to be? Are you going to plan for your future and the future of your business now or find an excuse and just let it happen on its own.

• • Own Your Own Life. This one is from me. You only have one life. Don’t wake up 10, 20, or 30 years from now and wish you had lived it differently. Embrace your life now and effect change in it if you aren’t happy. Work isn’t everything even when it feels like it’s consumed your entire life. Start planning for the future and begin letting go. In other words, ‘Just Do It’!