For twelve years, Lansing Crane was the CEO and Chairman of Crane & Co. Inc., his 213 year old family business. He now serves as Chairman of the Board of SOG Specialty Knives and Tools, Crane Insurance Company and Wells Enterprises, Inc. He is also a senior advisor on mergers and acquisitions to Brown Brothers Harriman & Co.
At the Private Company Governance Summit 2015 held last May in Washington, DC., Crane delivered a Keynote address, offering his 12 Rules for Family Business Failure.
Here is his list: “Do these things if you want to ensure failure for your family business.”
- Don’t share the wealth.
- Keep shareholders in the dark.
- Reward activity and seniority, not performance.
- Treat family employees better than others.
- Don’t share company performance information with employees.
- Use the “I” word instead of “we.”
- Let family trump on all decisions.
- Believe no one can understand your business better than you.
- Believe that tactics are really strategy.
- Avoid candid performance decisions and communications.
- Engage low-cost advisors, and don’t tell them everything.
- Take no risks.
When you step back and look at this list, the common thread is the leadership and culture of the family business.
How many of these are prevalent in your family business? If these sound familiar, take action. Having a sustainable family business is hard work. Don’t step on the landmines. Build leadership and an enterprise culture that will sustain the business and the family for generations to come.
For more information on Mr. Crane’s speech, go to www.privatecompanydirector.com.