One of the most challenging ones can be the transition period where the founding principals are preparing for retirement and passing on leadership to the next generation. So, how do these family-owned businesses handle this transition and what are the key steps in making sure the transition happens without disruption or conflict?
Golden State Carpet Service (GSCS) has been in business for 44 years. Started in February 1971 by 11 installers, my father, Mike Hansen, was one of the original and last of the founding partners, who is planning on retiring this year and is preparing his exit strategy.
A strategic succession plan is more important than ever before. In order for a seamless transition to take place, we are focused on a new strategy that will take us into the future but that is built with the same passion, drive and foundation that our business was founded. For Golden State, there are a handful of us that have grown up in this business—my brother, Shay, included—and we are committed to strategically designing a plan that incorporates the success of the past with the ideas and tools of the future. It’s necessary for generations to collaborate, and if done with a solid strategy in place, can bring your business to new heights.
At Golden State we begin with our guiding principles, which have always been centered on quality service and providing solutions and resources to our clients. It is more important than ever to use these principles as we transition into the future, with new generations. There is a stronger emphasis on accommodating the current demands of our marketplace, all while remaining relevant and competitive.
My father always focused on approaching projects with what he calls the cradle-to-grave mentality—handling every phase of the project cycle from beginning to end. This approach starts with the inception of the opportunity and continues through the entire project, which includes assisting in specifying material, inspecting job site conditions, providing take-off drawings, assembling the bid and attending client meetings. While this approach has proven to be very successful over the years, advances in technology, more aggressive project schedules, fast-paced growth rate in our market and the ever-growing importance placed on relationships requires our team to approach the business differently.
Our approach has had to evolve. Now we put a stronger emphasis on a team approach. We match the strengths of our management and sales team to each part of the process. This has enabled us to be more efficient while increasing our overall rate of success in terms of turning an opportunity into an actual project. In doing so, we make certain the project is managed as smoothly and efficiently as possible.
For example, gone are the days of doing a take-off by hand with color pencils. With the latest software, we have technology savvy estimators who can do an electronic take-off within minutes, making this process faster. With more of an emphasis on matching skills and talents with process and technology, this creates a much more efficient and effective workflow.
We also focus on leveraging proper relationships with each player in the game—construction manager, general contractor, architect/designer, manufacturer’s rep, end user, etc.—building trust throughout the entire process.
Generation collaboration can be very successful. A prime example for Golden State was the historic renovation of the Congregation Sherith Israel Temple in San Francisco. This project had many challenges. For one, the removal of existing carpet that was over 100 years old. The temple required the material be removed very carefully so it could be preserved and to ensure there was close to no airborne dust particles released during the demolition process.
In addition, this was a highly technical installation of a Wilton carpet that required the intricate pattern to be laid out symmetrically throughout the sanctuary with no seams in any of the walkways.
As one could imagine, there were very high expectations from the architect and the client as this renovation was being managed and funded by the temple’s members. With our previous cradle-to-grave project management style, this project would have been almost impossible for one person to manage effectively. However, by harnessing each of our strengths, we successfully completed an installation that exceeded everyone’s expectations.
Today, with a strong transition strategy in place, our approach to projects takes the strong work ethic of our past and combines it with new tools of the future. For the Congregation Sherith Israel Temple project, importance on project team relationships was key. Because of my relationship with the architect, I was able to provide valuable information pertaining to material and installation specifications and review all documents prior to the project bidding. With the technical requirements of this installation, my father was able to assist me with how to bid the project appropriately.
Once the project was awarded to GSCS, there were numerous construction planning meetings that took place between all parties involved to make sure all of our i’s were dotted and t’s crossed. I acted as the main point of contact for our team, managing communication and paper trail. When the installation started, my father was the main point of contact onsite, ensuring the project ran as efficiently as possible. He was able to address technical concerns of the project team, assist the installers and keep everyone on track.
In the end, we completed the project on time, the installation was beautiful and seamless, and the congregation was ecstatic that all expectations of the historic renovation were met.
It was a true testament to generation collaboration. My father stated, “In 44 years of business this was probably our most perfect job and this was a result, in large part, to both of us contributing our strengths.”
Our strategy and approach has evolved. However, our guiding principles have not. Today, we continue to provide quality service; we continue to be a comprehensive resource to our project partners and clients. We have accomplished all of this while establishing a healthy succession plan and management transition. My father will continue to do what he does best—consult a new generation on how to solve flooring problems and manage projects, while we manage the logistics of the rest of the business. This affords him more time to start to pull back while still contributing to the overall success and profitability of the company.
While we may not have aspired to be in the flooring industry when we were growing up, it has proven to be extremely rewarding. By building on our individual strengths and team approach, we will continue to drive our business for future generations to come and thrive for another 44 years.