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01/17/2024
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02/16/2024
Navigating Growing Pains: A Family Business Success Story
Two siblings had just finished their first quarter as the new owners of the business their grandfather had established from grass roots and their father invested decades of his life developing.
While the plan had always been for the adult children to take ownership when the time was right, the succession plan hadn’t accounted for one major detail –revenue scalability.
At the current company trajectory, a single owner could nicely support their family and keep a significant amount of profits in the business to fuel growth. Now that the company needed to support two owners and their families, the siblings soon found themselves in a predicament.
To realize their personal objective of enjoying a more flexible work/life balance and comfortable salary in carrying on their family legacy, their ownership vision was to work less tactically and more strategically “on the business” with a stronger focus on investing in growth.
The problem was that they underestimated what it would take to achieve the scale needed to support two executive roles.
They knew they needed to grow faster to achieve their new ownership vision but didn’t anticipate that their own business experience wasn’t enough to get them there.
Having already invested in the business, the siblings were frustrated that they didn’t see this coming. Worse yet, they saw no path forward because neither one was an accomplished sales leader capable of designing a strategic sales plan that could outperform the company’s historic revenue trends.
It quickly became clear there was no way they could take on the investment of additional exec overhead without putting the company’s longevity at risk, and that wasn’t an option.
Yet, they also couldn’t revert back to “business as usual” because they understood their own limitations and found themselves staring at a near term problem that had a potentially disastrous outcome.
Not only were their own households now relying on them to make this investment work, but the siblings had grown up with many of the employees who now depended on them. The siblings had even helped nurture customer relationships that went back for decades.
This created tremendous pressure on the new owners to learn how to become effective stewards of the family business. Recognizing their lack of sales leadership experience and urgency to grow, the owners took a decisive step by bringing in a proven Fractional VP of Sales to guide them through the steps necessary to achieve next-level, scalable growth.
This strategic move was aimed at constructing multi-year bottom-up revenue goals coupled with a well thought-out sales plan that would enable them to reach their various targets. This approach was in stark contrast from the long-time approach of “working hard” and taking whatever business they could find.
But having a strong plan was only part of the solution, the fractional sales leader also partnered with the owners to redesign their sales staff structure with clarity around roles, responsibilities, and key accountabilities.
The existing sales team, solely composed of external reps, had a wildly varied business development approach due to the absence of product verticals. Establishing these verticals allowed the team to work with more purpose and in tighter alignment with the company’s targeted growth areas.
Further, the Fractional VP of Sales led the new owners through the process of creating a sales system designed to guide, support, and govern sales operations so revenue generation could become predictable, repeatable, and scalable.
The team’s success became less based on random chance and whatever customers decided to order and all about a focus on predictable outcomes that were guided by leading and lagging performance indicators and strategic revenue planning.
This restructuring allowed the owners to decisively map out their target net income goals by having a clearer understanding of which areas their revenue would stem from.
This shift from a haphazard approach to a well-structured, strategic plan marked a crucial turning point for the family business.
The focus of the company has now shifted to key account management with the aim to ensure the maximum impact on revenue by dedicating time, resources and focus on the right customers and prospects.
What began as potentially sad story of a failed business succession transformed into a success story. Partnering with the right outside resources to help you bring together the necessary people, processes and systems is a powerful approach to break through barriers.
The two siblings, aided by their work with the Fractional VP of Sales, managed to grow their company significantly while positioning their family business for ongoing growth through the next generation.
Where there was once doubt, confidence now shows. Where they were previously concerned they could not hit the revenue goals they dreamed about when they invested, they feel empowered to reinvest profit into the business to accelerate growth.
The owners are heroes to their families who depend on them. They are also heroes to the employees who count on them for their livelihood and long-term career path options.
The owners themselves were able to realize the career path they dreamed of but only because they recognized that they needed outside help to reach their targets. They identified the problem early on and acted quickly to remove roadblocks.
If you’d like to discuss the improvement you’re looking for in your business, contact me through any of these methods: (404) 271-6767 or [email protected] or book a call through my Scheduling Tool.
Dan Mahony
President
I am part of a national group of Senior Sales Leaders who collaborate to share insights like the examples shown in this article. We formed because of our shared passion to help business leaders exponentially grow their revenue.
