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Strengthening 'Threads' - Family Biz Fundamentals

Versatile leadership that promotes trust, transparency and a clear focus on business goals amid changing conditions is critical for family businesses in today’s vigorously competitive linen, uniform and facility services markets.

That was the core message that a group of 20-plus members of TRSA’s Young Leaders Committee heard during a July 21 seminar in Chicago led by David P. Ransburg, founder and senior adviser of the Family Business Consulting Group, Deerfield, IL. His presentation at the Allegro Hotel downtown, was titled An Uncommon Thread of Success in Family Business.

Ransburg, a former marriage counselor who grew up in his family’s Peoria-based lawn sprinkler business (L.R. Nelson Corp.), emphasized the need for leadership “versatility,” i.e., the ability to respond effectively to a variety of business and human-resource challenges. Stock responses to diverse issues won’t cut it, he said. Each situation requires its own reaction. “It doesn’t mean you just be forceful all the time, or you’re just enabling all the time,” Ransburg said. “It also doesn’t mean you’re kind of in the middle.”

Elaborating on this theme, Ransburg advised the Young Leaders, “Don’t be ‘lukewarm tea.’ People like iced tea; people like hot tea. Nobody likes lukewarm tea. It means deliver iced tea when it’s hot out and people are thirsty; but be able to deliver hot tea when that’s what people want. That’s very hard to do.”

While versatile leadership poses challenges, those executives that deliver it are more likely to succeed, Ransburg said. He cited a study of 18,000 business leaders that showed that “50% of what explains the difference between effective leaders and those who are not effective is their versatility, the ability to be forceful when called for and being enabling when called for.”

To illustrate this finding, Ransburg highlighted two quotes in his PowerPoint slides. One was from Jack Welch, former CEO of General Electric Co., who said: “You can't grow long term if you can't eat short term. Anybody can manage short. Anybody can manage long. Balancing those two things is what management is.” A second quote came from former UCLA basketball coach John Wooden. His words centered on building team morale. “The biggest motivator is a pat on the back from someone you respect … although, sometimes that ‘pat’ has to be a little lower and harder.”

Ransburg gave the attendees a better understanding of effective leadership principles by outlining several ideas based on the word “T-H-R-E-A-D” used in the title of his talk. These themes included “Trust,” “Halt Conflict,” “Respectful Leadership,” “Epoxy” (i.e., cohesiveness), “Alignment,” and “Dialogue.” Trust requires transparency, meaning no “secret deals” between executives and a willingness by everyone to follow through on business commitments. Sharing common experiences, such as a Chicago Cubs game that the Young Leaders attended after the morning meeting, also can help build trust and understanding among staff and managers. The night before the seminar, the group enjoyed dinner with TRSA’s Strategic Planning Committee as well.

To help business leaders avoid “harmful conflict,” Ransburg noted the Wooden quote cited above and the need for balanced leadership. On average, Ransburg said, a 5-1 ratio of positive to negative feedback is appropriate in most cases for a leader seeking to develop a cohesive team. When conflicts arise, especially between family-member executives, he advised taking brief “time outs” at any time that one or more leaders feel “flooded” by emotion and thereby incapable of discussing issues rationally. 

As for “dialogue,” Ransburg encouraged attendees to challenge strategies in their companies in a spirit of open debate. Should conflicts emerge, one shouldn’t “ignore the elephant in the room.” However, executives can minimize hostility by posing questions to adversaries in a way that’s designed to avoid putting that colleague on the defensive. “Don’t get mad, get curious,” he said, noting that a “soft strategy” of keeping communication flowing can lower the odds of grudges emerging that can undermine long-term relationships. In cases of severe disagreements – Ransburg cited a couple of cases involving prominent companies where fist fights erupted over internal conflicts – companies may want to bring in an outside counselor to help sort things out.

In closing, Ransburg cited Man’s Search for Meaning, a book by Holocaust survivor Viktor E. Frankl, who wrote that if a person - or by extension a business - has a clear purpose, they can overcome the most severe hardships, including the kind he experienced in a Nazi concentration camp. Conversely, if a business lacks vision, no amount of effort is likely to make much difference. On this point, Ransburg cited Zig Ziglar, the late motivational speaker/sales expert, who said, “If you aim at nothing, you’ll hit it every time.”

To learn more about TRSA’s Young Leaders Committee, contact TRSA President and CEO Joseph Ricci at jricci@trsa.org.