What does it take to effectively run a family-owned business? A third-generation tooling manufacturer offers its two cents.
Managing a family-owned business involves dealing with interpersonal dynamics that may not be present in other companies. Corydon, Kentucky’s Quality Tooling is a family-owned tooling manufacturer that’s into its third generation. James Alvey started the company in 1968 out of his garage and has since retired. His sons Michael and Brian now run the successful operation, and Michael’s son, Stephen, is one of the shop’s lead designers. I met with Michael, Brian and Stephen while visiting the company to develop this story.
A number of shops that receive our magazine are family-owned. Therefore, I asked the Alveys to offer insight about what it takes to run a successful family business. Here are their thoughts:
James: “The key to keeping a family business running successfully is to always be honest and mindful of all employees and customers. They are the backbone of your company, so treat them how you want to be treated. Continuously work hard and let them know you are always there for them.”
Michael: “It means a lot to me that my sons Stephen and Brendan and daughter Alyson wanted to join the company and continue my father’s legacy. Employees have come and gone, and many of them have been like extended family members. But as my father once said, if you surround yourself with good people, everything will work out. So far, that has proven to be true.”
Brian: “Working very hard at making smart purchases and trying to remain debt-free will help our company remain strong now and into the future when subsequent generations will take the reins. By putting qualified family members in key positions, our business will be resilient no matter how much employee turnover we encounter. We’ve had many valuable employees but feel no one is as loyal and dependable as a family member.”
Stephen: “It is vital to be able to separate business decisions from family life, although this can be easier said than done. By maintaining boundaries, it is less likely that you’ll introduce conflict with family at home or at work. Sometimes decisions made in the best interest of the company might upset a family member. But even though my personal loyalty may lie with that person, it is important to make choices at work for the overall good of the company rather than basing business decisions on family loyalty.”
I’ve worked for a few family-owned businesses over the years, including Gardner Business Media, publisher of this magazine. I chatted about this with Richard Kline Sr., president of our fourth-generation company, and he believes “it is important to surround your family with employees that are smarter than them, no matter how smart you think your family members are. Smart people run smart companies. Family members should also build consensus rather than taking the ‘my way or the highway’ approach to decision making, because there often is no single right answer to a problem. Ultimately, you must treat family members and employees with respect.”