Adam Hatcher: Hey there.
Welcome to the 21 Clear Podcast, where we talk about anything to help
you chaos, proof your family business so you can build a great company
with a strong family around it.
I'm your host, Adam Hatcher, the founder of 21 Clear, and today we're
gonna follow up on our last episode.
In that episode I laid out.
The family business framework, a framework for running your family business meetings
and putting important elements in place with trust building in the center.
To let you chaos proof your family business.
And recently Sarah Davis, who was our guest in episode three
and is the director of Kennesaw State's Family Enterprise Center.
Sarah invited me to give a webinar on a part of the framework.
We covered chaos proof hiring with 13 years as a leader and executive in our
family staffing and recruiting company is something I was quite familiar with.
And so, this episode and the next episode, we're gonna take that
webinar and break it into two parts.
Today we are gonna explore the first part of chaos proof hiring.
So there are four elements to it.
Gonna lay out a case for intentional family business hiring, and then lay out
the first element with an example, and then in the next podcast we'll take the.
The end of that webinar and we'll lay out the last three steps for you.
So if you didn't hear the last episode on the framework and you want a bigger
picture, just walk back to episode four and episode five is gonna be the beginning
of chaos, proof hiring, and then part two of Chaos Proof Hiring will be episode six.
So let's jump right into the webinar and I hope you enjoy.
Today we're gonna touch this idea of how you hire well, or we would say, how
do you chaos proof your family hiring?
Because the only way you have a family business is if you've hired one.
After the founder,
once you have a family business, you hire.
My grandfather hired my grandmother on the first day that our
family's company was started.
There wasn't really a process, and I'll spare you the story for today,
but that employment lasted one day and there are lessons in both hiring,
leaving, running the family business, working well and building trust in
their single day of working together.
But what is interesting to me about hiring well and doing it
intentionally, it is the opposite.
The opposite of drifting into your mom and dad's company.
I live here in Augusta and I was on the driving range one day.
And there's a guy, we will call him Victor, here on the webinar.
But Victor was hitting next to me.
We hadn't met, and I asked Victor what he did and he said, you mean what did I do?
Well, well, tell me about it.
He said, well, my brother Mo and I took 20 years to build a company together.
I said, oh, well, and how's the company going?
He said, well, I don't work there anymore.
So I asked him what happened.
He said, well, my nephew, my brother Mo's son, he wanted to join the company.
And I told him that kid didn't know a thing.
I told him he didn't work hard.
He'd always been lazy and I wasn't gonna have him.
I was interested now, and he said, well, we got in an argument.
And after a couple of weeks, my brother Mo finally said to me, you know what, Victor,
if we don't see my son the same way, then we don't see business the same way either.
And that was the end.
They didn't have a way to establish whether or not a family member was
qualified to work for the company.
And also to working together well, they didn't have a way to resolve conflict
with each other outside of the business.
And I tell you all that story, because the end of it actually broke my heart.
So the brother Victor ends up leaving.
Mo hire's his son.
About a year later, Mo tried to get Victor to come back after firing the son.
Victor had moved on with his career.
He came back and helped with one customer that was key to him, but never returned.
And then Mo the brother died.
Leaving his widow with a company that was not well run with a family
that was strained and a son who was estranged away from them.
When I say it's not a problem, it's chaos.
When they say that chaos can get into a family company and
rip up a company and a family.
That's the stakes when we work together that we're playing with.
And that's why focusing on hiring is so important.
'Cause every one of us that has a family company has to do this.
So lemme give you, in this family business framework, four steps, and we promised
at the top you were actually going to be able to get better at hiring family today.
So my encouragement to you, I believe Kathy Milton, who's on here, is
around a bunch of other people.
Kathy, you may not wanna do this on a sheet of paper in front of other
people, but if you have a sheet of scratch paper, put it out to the side.
'Cause there's gonna be a couple opportunities for you to draft,
ways that you can think about chaos proofing your hiring, right?
So you have four things to chaos proof family hiring.
The first one is family hiring criteria.
Then it's a commitment to match family members to actual jobs.
If you have family criteria and you have a family member who is qualified for an
actual job in the company, then I'm going to tell you the next step is to say no.
Meet the family criteria, pair up with an actual job, but then say no.
And if you get over that third point, that third objection, then it is
not just drifting into day one, it is actually vigorously onboarding
family members in a way that is dissimilar to how you onboard family.
Alright, so family hiring criteria.
I want to tell you all a personal story.
I was at my maternal grandfather's funeral.
My paternal grandfather started our family's company, so different one.
I was at my maternal grandfather's funeral.
We were at the reception after my grandfather's funeral, and one of his
friends who'd been in a civic group with him who was older, talked to me
in the line and I asked him what he did and he had spent about 35 or 40
years scaling a business with his son.
And so I asked him, what's going to happen for your family company next?
He told me that he was so proud of his son, said he went to Georgia
Tech and he got an engineering degree, and they were an engineering
firm, and said Georgia Tech,
and he's worked with me for 25 years and he's learned all the different
functions and my clients love him, the employees love him, and he's really
let me become chairman and I am just, I look forward to turning it over.
We hadn't quite worked out the ownership yet, but my son can take
over and I was, again, remember I'm at my grandfather's funeral just
getting appetizers off of a buffet and I said, wow, you are so fortunate.
That is not the story for so many people.
That was a mistake to say, because then he said, oh, well yeah, it's not all
that good because my son wants to hire my grandson, and that kid's an idiot.
He said, he doesn't know anything.
My son's gonna hire him one day and that boy is gonna tear down everything that
we have spent three decades building.
And I took a breath and thought about this idea of family hiring criteria
and I said, well, let me ask you, have you and your son ever sat down and
made a list together of if any family member ever wants to join the company?
What they would have to do before they were even considered.
He said, no.
I said, well, lemme tell you this.
I said, in my experience with family businesses and family owners, I can tell
you this, family owners don't like making lists and they absolutely don't like
being governed by the lists they make.
But it's way better to argue about bullet points on a criteria list than it is to
talk about the intelligence of a grandson.
So what I encouraged him to do is first what is family hiring criteria?
It is a written list
that is for family members, before they can be considered for the job, any job.
So note this is not I was hired into our family's company as the general counsel.
This never asked the question, is Adam qualified as an attorney to be
the general counsel of the company?
It's a prerequisite list and whatever you put on the list, the two most important
things in creating it is that first you actually do it, and then you're
as specific as you possibly can be.
So I want to pull back our curtain and show you the list
that our family company had.
I wanna tell you before I do though, my father wrote this list
when the company was at about $50 million top line and was regional.
It was increasing and it was an increasingly complex organization.
I joined in 2010, so when he created this, we had not gone through 2008
yet, or we're just in the middle.
I'm sorry, we're in the middle of the 2008, 2009 crisis.
So he's writing the list in that.
But he knows that the company's gonna bounce back and he knows that the demands
of the company, the customers that it sells to, were global and publicly traded
clients, meaning the sophistication and the demands were gonna keep going up.
And so if the grandfather I had been talking to at my grandfather's
funeral made a list, his list and our list weren't gonna be the same.
So I'm gonna show you ours, just as an example.
So I am in law school.
My brother is in college, my sister was in high school, and we all got
the same letter from our father.
And it said, I don't know if the Lord will ever call you back or you'll ever
feel a call to join the family company.
But if so, five things have to be true.
First, you have to graduate from college.
Second, you have to have a degree from graduate school, not a
specific type of graduate school.
My brother got an MBA, I went to law school, but you have
to have a graduate degree.
You have to go work somewhere else.
That is not unique in family companies requiring working somewhere else.
However he added to that, you must get promoted somewhere else.
And then lastly, he said, your life needs to be reflective of Christian values.
Now I want you to read into that real quick.
What he was doing, the company is a for-profit, privately held company that
holds itself out as being faith-based.
He wanted to make sure that any family member that joined could work
in a company that held itself out as having particular faith principles.
And so that list isn't gonna be your list.
You have a different family, you have a different company,
you have different customers.
But there are three things.
If I broke his list down, it really had three things in it.
First, it had education requirements.
Second, it had experience requirements.
And third, it worked to have an alignment with the culture of the organization.
And I wanna touch experience and education real quick.
And here's something I love about what he did.
He told me once, Adam, I graduated from Georgia on a Friday.
I went to work at the family company on a Monday.
The only person who ever gave me a job was either my father by promotion or
the day I bought the company from him.
I want you to always know that you have value outside of this organization and
outside of my eyes when you come to work here, I also need you to go get experience
that we could never get without people who have worked outside and brought it in.
And so what he was doing with this list for any family member who
joined in an increasingly complex organization, he wanted them to be part
of the future of the company with our particular clients, but also always
have their own independent identity.
'Cause if you've ever worked with family, you know how difficult that can be.
So that's our list and that's the concept.
If you have your side sheet of paper, I want you to try this real quick.
Okay.
So just a grid, we're gonna work over to you.
So there's those five criteria.
I said he put in a letter, let's assume your family business is
X, Y, Z manufacturing company.
Let's just give a different example.
So let's say they sent a similar letter.
It might say that before any family member comes to work for X, Y, Z, they
need to have an engineering degree.
And again, I'm gonna encourage you to get specific with your criteria, not
just go to college or go to school, okay?
An engineering degree from a US news, top 100 university.
And then for experience.
You've got to work outside the company for three years and have become
a manager of at least one person.
See, that's different than the way my father phrased it for our company.
And then lastly, the cultural alignment.
When we do a reference check on you, your references need
to talk about your humility.
Let's assume humility is a big part of the culture of that company, and we
don't want you to have an arrest record.
You can write this in your family hiring criteria.
Okay?
So you can see what these criteria do is it communicates to the family,
their education experience, and cultural prerequisites, and none
of these have anything to do with actual skills and fit to a job.
So take just a second.
And think about your own company.
If you have someone in your family who is, maybe you have family who are about to
graduate from college or in high school.
Maybe you have nieces or nephews who may be in kindergarten, but your cousin,
your sister-in-law, your aunt, someone has asked you, Hey, might they ever
have an opportunity to work with you?
These questions come up earlier than any of us think.
So think if you had your way, what education would you wanna make sure
any family member who joined had?
And then what experiences outside the organization would you want them to have?
And then think through your core values.
Pick one, pick two, or just the cultural behaviors your company
and its leaders are known for.
What's one of those?
What's two of those?
You wanna make sure every family member is aligned to.
Education, experience, cultural alignment.
That's family hiring criteria.
That's the first step in chaos proofing family hiring.
And now I want to celebrate you.
Okay?
If you took a minute, Kathy Milton, no matter where you are.
Yeah, Kathy logged in first, so I just picked on her a couple times.
If you just did this, I wanna celebrate you because here's what's so hard
about a family business, right?
So I know running an organization day in and day out is hard.
It's hard to do strategic planning.
It's hard to make the time.
It's hard to have the discipline.
If it's hard enough to argue with customers,
it's certainly hard to argue with each other about value propositions.
But this is even harder.
This is doing inner family business work.
And the family business has no revenue.
It has no customers, but it sits right in the heart of the organization.
And if it's healthy, it can help the organization reach
full value with a strong family.
And if it's not, all of it can go away spectacularly.
And so what you just did maybe for the first time?
Well, not really, 'cause this is the Kennesaw State Family Enterprise Center.
But maybe for today, maybe the first time today you've thought
about that inner family business and taken a step at making it
healthy.
So congratulations to you.
Alright, that's step one.
Now let's go to step two.
That is the end of the first part of the Kennesaw State
Family Enterprise Center webinar.
In the next episode, we're gonna finish that and go through the last
three elements of chaos, proof hiring.
I hope this has helped you think about your inner family business a bit.
This is the kind of topic when you have family meetings that you both create,
debate, and communicate, and so I hope this was a helpful podcast for you.
Look forward to sharing the rest of it with you in episode six.
I appreciate you subscribing and following.
We do have a monthly newsletter and post content on LinkedIn as
well that I hope is helpful to you.
I appreciate you joining, as my grandfather would've said.
Thank you so very, very much for listening.