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A Family Business Comes Full Circle
- By PDCA
- Published 09/2/2008
- PDCA's DECO Articles
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By Liz Schick
There are a number of basic tenets that a family-owned business should observe in order to be fair to both non-family employees and family. Consider Jack and Cindy Royed, owners of Continental Painting in Cerritos, California. Many of their practices have evolved over the past 30 years, and have become more focused as their son, Matthew, has now joined the company.
Starting back in the “gnarly” 1970’s, the only thing that inspired teenager Jack Royed was surfing. “Surfing was the love of my life,” he says, “and I started painting because it was an easy way to finance my trips back and forth to Hawaii.”
Once he met his future wife, Cindy, Jack realized that he had to get more serious about working than surfing. So in 1978, he formed Continental Painting and ran it from their home. Cindy worked in the fitness industry, and continues to do so. After they married, she would come home and do the books for the fledgling company. “He was a one-man band for quite a few years,” she remembers. “But it was great, because it afforded us, as a young family, to have Jack around a lot.”
After a few years of residential painting, Jack tackled custom homes. Then, in 1988/89 he moved into the commercial and industrial markets--as he puts it, “to get the best return for the time invested.” As the company grew, it outgrew their house and moved into an office building, which is now the headquarters for 20 full-time employees, six office staff, and up to 25 field employees.
While he had no college or formal business training, and “often flew by the seat of my pants,” as Jack put it, “it was desire and a ‘never-say-die’ attitude that helped me transition from being a field painter to a business manager.” Cindy’s 15 years in corporate management within the fitness industry helped as well. It enabled her to bring many ideas and methods to Continental Painting that have helped it succeed.
Some years back the Royeds realized that they needed to organize the company so it would run without them, freeing them up to travel or retire or to have their son, Matthew, take it over. “This meant that we began to break the company down into departments and titles,” Cindy says. Instead of having people overlap in certain areas because their jobs weren’t defined, now each job has its list of duties and responsibilities. In addition, jobsite supervisor positions were created by promoting from the field crews. “As we grow,” Cindy says, “employees know there is room for them to grow, as well.”
The newest family member in the compa¬ny is son Matthew, who worked summers through high school as a field painter and is now in college. “Two years ago my dad opened the door and offered me an office position,” Matt says. “I still go to school— I figure every company needs a creative writing major—but I like the idea of being in the business.” As part of the company’s restructuring, Matt is now part of the estimating department— reading blueprints, doing job walks, and beginning to take on sales responsibili¬ties by making customer calls.
From the get-go, Jack Royed realized that his employees are his company’s biggest asset. He says: “I made sure they would be paid first, before I took my portion of the company’s money. Now there is a bonus program and five years ago a pension program was initiated.”
Jack looks at the current state of the economy with a philosophical eye: “We had an economic downturn in the 70s, in the late 80s, in the 90s, and we are doing it again right now. When that happens, the volume of work isn’t as great as it is during the other times, so we have to really pay attention and make sure our customers know that we are here. There are a lot of strategic moves we must make to face this challenge by building stronger relationships, making ourselves available, and going that extra, extra mile for our customers.”
After having the business for so many years, statistical analyses are available on just about everything, from produc¬tion in the field to estimating and finan¬cial reporting. “All our decisions are fact-based, and weekly staff meetings generate ideas that merit consideration and are implemented when appropri¬ate,” Jack says.
The Upside/Downside
“Sometimes you can be too close to your family and to your business, and it’s tough to be objective,” Jack observes. “You might not be making the wisest business choices because of that. On the other hand, you also might be expecting too much from a family member that you wouldn’t from another employee.”
Cindy observes something similar. “It’s tough to leave it in the office, so you tend to bring it home,” she says. “It’s easy to sit around the dinner table and start talking about business. But Cindy also sees an upside. “Many times, when we’re away from the job and not in the throes of a problem, we come up with some good solutions,” she says. “We listen to each other speak and respect what each of us has to say.”
Even Matt Royed agrees. “I don’t mind talking about work at home for the most part,” he says, “because it does make things a little more relaxed and clear, and it might even help settle things that might be on my mind in regards to work. It makes me feel as though I have some¬place where I can be open and can talk about work things, so it’s kind of nice.”
Obviously, diplomacy comes naturally to 23-year-old Matt “Being around the family all day, every day, is not a bad thing, he says.”
The full circle
As much as he loved to surf, for the 10-year period while Jack was building his business he just had no time for it. When Matt turned 16 and expressed a desire to take up surfing” life came full circle,” Jack says. “The business was at the point where I could pick it up again. Matt and I now travel the world to surf—Fiji, El Salvador, the Cook Islands, Costa Rica, Mexico, and of course, Hawaii. My wife and I can travel anywhere else we want. I’m thankful that the business affords me the opportunity to participate in the love of my life with the loves of my life.”
“Everybody has dreams,” Royed says, “and when you start out you envision what you would like to have happen to you and your company. It was a wild dream 30 years ago and here we are. Little did I know I would have my wife and my son be part of it, which makes it extra special.”
Keys to a Successful Family-Owned Business
According to Mike Henning’s Henning Family Business Center, there are 10 “secrets” to running a successful business when family members are involved. Henning is a consultant who has been helping families in business since 1985. His web site is www.mikehenning.com.
1. Create a common vision for the family and the business so they aren’t at odds with each other.
2. Put appropriate governance structures in place to create cohesion among family members, outside directors, and advisors.
3. Have a clear separation of roles. All family members must be in agreement on the respective roles of the owners and other family members.
4. Family employment policy: No family member must consider employment as his/her “right” and it must be clear how grievances will be handled.
5. Attracting and retaining non-family members is the major challenge for family-controlled companies not using stock ownership as an incentive for non-family employees.
6. Management and ownership succession processes must be in place so all employees and family realize the choice is a strategic business decision, not a personal one.
7. Develop knowledgeable owners. The more family shareholders the greater the probability there are fewer shared values. (See #9)
8. A conflict management process should be defined in case the family’s open communications fails to resolve any conflict between family members.
9. Writing the family creed. There is a strong need to put in written form the policies under which a family will operate; value systems and principles.
10. Nourishing positive family relationships: all for one and one for all versus competition or manipulation is a clear winner for running an ongoing family business.
There are a number of basic tenets that a family-owned business should observe in order to be fair to both non-family employees and family. Consider Jack and Cindy Royed, owners of Continental Painting in Cerritos, California. Many of their practices have evolved over the past 30 years, and have become more focused as their son, Matthew, has now joined the company.
Starting back in the “gnarly” 1970’s, the only thing that inspired teenager Jack Royed was surfing. “Surfing was the love of my life,” he says, “and I started painting because it was an easy way to finance my trips back and forth to Hawaii.”
Once he met his future wife, Cindy, Jack realized that he had to get more serious about working than surfing. So in 1978, he formed Continental Painting and ran it from their home. Cindy worked in the fitness industry, and continues to do so. After they married, she would come home and do the books for the fledgling company. “He was a one-man band for quite a few years,” she remembers. “But it was great, because it afforded us, as a young family, to have Jack around a lot.”
After a few years of residential painting, Jack tackled custom homes. Then, in 1988/89 he moved into the commercial and industrial markets--as he puts it, “to get the best return for the time invested.” As the company grew, it outgrew their house and moved into an office building, which is now the headquarters for 20 full-time employees, six office staff, and up to 25 field employees.
While he had no college or formal business training, and “often flew by the seat of my pants,” as Jack put it, “it was desire and a ‘never-say-die’ attitude that helped me transition from being a field painter to a business manager.” Cindy’s 15 years in corporate management within the fitness industry helped as well. It enabled her to bring many ideas and methods to Continental Painting that have helped it succeed.
Some years back the Royeds realized that they needed to organize the company so it would run without them, freeing them up to travel or retire or to have their son, Matthew, take it over. “This meant that we began to break the company down into departments and titles,” Cindy says. Instead of having people overlap in certain areas because their jobs weren’t defined, now each job has its list of duties and responsibilities. In addition, jobsite supervisor positions were created by promoting from the field crews. “As we grow,” Cindy says, “employees know there is room for them to grow, as well.”
The newest family member in the compa¬ny is son Matthew, who worked summers through high school as a field painter and is now in college. “Two years ago my dad opened the door and offered me an office position,” Matt says. “I still go to school— I figure every company needs a creative writing major—but I like the idea of being in the business.” As part of the company’s restructuring, Matt is now part of the estimating department— reading blueprints, doing job walks, and beginning to take on sales responsibili¬ties by making customer calls.
From the get-go, Jack Royed realized that his employees are his company’s biggest asset. He says: “I made sure they would be paid first, before I took my portion of the company’s money. Now there is a bonus program and five years ago a pension program was initiated.”
Jack looks at the current state of the economy with a philosophical eye: “We had an economic downturn in the 70s, in the late 80s, in the 90s, and we are doing it again right now. When that happens, the volume of work isn’t as great as it is during the other times, so we have to really pay attention and make sure our customers know that we are here. There are a lot of strategic moves we must make to face this challenge by building stronger relationships, making ourselves available, and going that extra, extra mile for our customers.”
After having the business for so many years, statistical analyses are available on just about everything, from produc¬tion in the field to estimating and finan¬cial reporting. “All our decisions are fact-based, and weekly staff meetings generate ideas that merit consideration and are implemented when appropri¬ate,” Jack says.
The Upside/Downside
“Sometimes you can be too close to your family and to your business, and it’s tough to be objective,” Jack observes. “You might not be making the wisest business choices because of that. On the other hand, you also might be expecting too much from a family member that you wouldn’t from another employee.”
Cindy observes something similar. “It’s tough to leave it in the office, so you tend to bring it home,” she says. “It’s easy to sit around the dinner table and start talking about business. But Cindy also sees an upside. “Many times, when we’re away from the job and not in the throes of a problem, we come up with some good solutions,” she says. “We listen to each other speak and respect what each of us has to say.”
Even Matt Royed agrees. “I don’t mind talking about work at home for the most part,” he says, “because it does make things a little more relaxed and clear, and it might even help settle things that might be on my mind in regards to work. It makes me feel as though I have some¬place where I can be open and can talk about work things, so it’s kind of nice.”
Obviously, diplomacy comes naturally to 23-year-old Matt “Being around the family all day, every day, is not a bad thing, he says.”
The full circle
As much as he loved to surf, for the 10-year period while Jack was building his business he just had no time for it. When Matt turned 16 and expressed a desire to take up surfing” life came full circle,” Jack says. “The business was at the point where I could pick it up again. Matt and I now travel the world to surf—Fiji, El Salvador, the Cook Islands, Costa Rica, Mexico, and of course, Hawaii. My wife and I can travel anywhere else we want. I’m thankful that the business affords me the opportunity to participate in the love of my life with the loves of my life.”
“Everybody has dreams,” Royed says, “and when you start out you envision what you would like to have happen to you and your company. It was a wild dream 30 years ago and here we are. Little did I know I would have my wife and my son be part of it, which makes it extra special.”
Keys to a Successful Family-Owned Business
According to Mike Henning’s Henning Family Business Center, there are 10 “secrets” to running a successful business when family members are involved. Henning is a consultant who has been helping families in business since 1985. His web site is www.mikehenning.com.
1. Create a common vision for the family and the business so they aren’t at odds with each other.
2. Put appropriate governance structures in place to create cohesion among family members, outside directors, and advisors.
3. Have a clear separation of roles. All family members must be in agreement on the respective roles of the owners and other family members.
4. Family employment policy: No family member must consider employment as his/her “right” and it must be clear how grievances will be handled.
5. Attracting and retaining non-family members is the major challenge for family-controlled companies not using stock ownership as an incentive for non-family employees.
6. Management and ownership succession processes must be in place so all employees and family realize the choice is a strategic business decision, not a personal one.
7. Develop knowledgeable owners. The more family shareholders the greater the probability there are fewer shared values. (See #9)
8. A conflict management process should be defined in case the family’s open communications fails to resolve any conflict between family members.
9. Writing the family creed. There is a strong need to put in written form the policies under which a family will operate; value systems and principles.
10. Nourishing positive family relationships: all for one and one for all versus competition or manipulation is a clear winner for running an ongoing family business.
