This is the third and final installment in our discussion of succession, an important and relevant topic, because over the next three to five years, the majority of construction companies will experience the retirement of their baby boomers, now filling key senior leadership roles, including the CEO. We have discussed the limited options to sell their companies that most traditional building general contractors have. In almost all cases, the only option is to sell it internally it internally – to family members or to a key group of employees – or to create an Employee Stock Ownership Plan (ESOP).
August 18, 2017
In this second article in our series on succession, we will continue the discussion of the internal transfer of responsibility and ownership, the most common method for construction companies. It does bear repeating that self-performing contractors, not required to bond, can usually be sold, as can established general contractors with a strong brand franchise and a reliable client base, especially in preferred growth markets. Still, most construction firms transfer ownership and control internally.
July 19, 2017
Senior executive succession planning is a current priority for many construction companies. Baby boomers are reaching ages where they seek to retire or work significantly less. To custom tailor exits or cutbacks, where there is a legal “change of control,” requires deep, strategic thinking, guided by experienced, neutral, outside advisors.
June 20, 2017
The following article originally appeared in the May newsletter to clients of Kiley Advisors, now a part of FMI Corporation. Reprinted with permission. There is an amazing similarity between what real champions in both sports and business do, and it is worth some reflection. In the broadest sense, these people and organizations, no matter what their demonstrated competencies and past performance records, strive, not just hope, to get better. They take proactive steps to develop a qualified outside support system that allows them to make candid comparisons, set realistic strategic targets, and develop the specific skills needed. They have extraordinary mental toughness and discipline. They know they can get better; they make the investments to acquire the guidance and coaching; they do the work. They repeat this process.
May 12, 2017
Contractors as individuals come in as many varieties as people themselves do. However, those that become successful builders have two common characteristics, regardless of the markets they serve, the size of the organizations they build, their geographic location or their ability to self-perform. These essential two ingredients are authenticity and appreciation. Both are the hallmarks of true leaders, and both are threshold qualities for those that will become their successors.
April 13, 2017
The following article originally appeared in the February 2017 newsletter to clients of Kiley Advisors, now a part of FMI Corporation. Reprinted with permission.Milestone events, like our acquisition by FMI, prompt a period of reflection and optimism. You look to the past for conclusions and lessons; you look to the future with expectations and possibilities. While I was in this period of pondering, I heard Tim Cook, Apple’s highly respected CEO, on the Charlie Rose Show. Responding to the question about Apple’s continuing ability to innovate, he said, “We will always do it. Steve [Jobs] put innovation in our corporate DNA.”That interchange made me think harder and deeper as I looked to the past. For the past 33 years, from a very privileged perch, I have been observing commercial construction contractors in the Greater Houston Area. This period per statistics and records has been the most volatile in history. Adapting to frequent, often extreme, changes has been imperative for those companies that survived and prospered.
February 14, 2017
The following article originally appeared in the January newsletter to clients of Kiley Advisors, now a part of FMI Corporation. Reprinted with permission.We begin 2017 with optimism and excitement. We have been able to “walk our talk” about executing the right succession plan. As of January 1st, we become part of the Houston Team of the heralded consulting firm, FMI. The timing is right for us, I am now an octogenarian; Candace, a leading-edge millennial on the springboard of her productive years. They are attracted to my past and her future.Candace and I are humbled and honored to join our industry’s leading consulting firm. Our mandate is to continue to serve our clients exactly as we have and to help them grow in Houston and Texas. This move gives us the capacity to add significant additional value with FMI’s vast resources of bright people, tailored industry data, and an impressive track record of helping construction companies prosper and grow.
January 18, 2017
The following article originally appeared in the December newsletter to clients of Kiley Advisors, LLC. Reprinted with permission.I lost another hero. Dr. Denton Cooley died on November 18th 2016; he was 96. He was an incredible human being in addition to being a brilliant heart surgeon. I worked for him for 10 years, writing news releases and an occasional speech. He has the same qualities that great contractors do: a great respect for superior craft skill and the ability to analyze and take risks – in his case to save lives.He was a superb technical surgeon, gifted with incredible speed, a true Master Craftsman. Recognized heart surgeons from around the world would “scrub in” to watch him. Dr. Christian Barnard, another high-profile heart pioneer, called Cooley’s surgery “the most beautiful he had ever seen.” Cooley and his team have done the most open heart surgeries in the world.He was the “Captain of the Ship” in the OR; he was totally responsible for the patient, the highest authority, and he would take calculated risks to save patients, many times moving the medical frontier forward.
December 08, 2016
On September 25, 2016, Arnold Palmer died at age 87. Golf lost an outstanding champion; America a truly great citizen. He was called “the King”, not only for his 62 wins, including 7 majors, but also what he did for the game, for thousands of ordinary people, and for the community and the country. His life provides a leadership blueprint for all.He remained, despite all his success, an absolutely authentic person. He was a blue-collar everyman, the son of a golf course superintendent and golf pro, who gave him bedrock values of respect for others and the importance of hard work – values he embraced and honored his entire life (Arnold’s dad also gave him a great grip, the most critical fundamental to the golf swing.) It is interesting that these traits and values are the hallmark of most successful contractors as well. They are humble, real, hardworking, and appreciative.Palmer had an amazing connection with his fans. They formed Arnie’s Army, and thronged around him at tournaments. They relished his consistent hard-charging style where he would take risks his competitors would not. Risk taking resonates with contractors too; it is the heart of the business. After his playing days ended, he and pal, Joe Gibbs, started the Golf Channel, now part of NBC. His lawyers and advisors told him this deal was too risky, to which he snapped back, “If I hadn’t tried to hit it over some trees or across some ponds on several occasions, we wouldn’t be here talking.” Sound familiar?
November 28, 2016
The memorial service for Paul Gervais Bell, who died on October 31, 2016, held at St. Martins Episcopal Church, was perfect – brief, traditional, and reverent. It reflected his respect for ritual and protocol. The magnificent sanctuary structure added dignity and relevance. It reflects the very best of construction craftwork and construction company leadership, two areas that were of major importance to him throughout his life.Those of us from the construction industry called him, “Paul;” those from his other walks of life “Gervais.” By whatever name, we all know he was as fine a person as we have ever known, so the church was predictably full. The Right Reverend Pittman McGehee’s eloquent homily, replete with poetry, movie lines and reflecting his Jungian mastery, portrayed Paul as a “fully individuated individual,” a man who achieved “all that he was born to be through baptism,” and, “as one of the Easter People, Paul would move to an afterlife having been a Good Man and Good Leader here.”
November 16, 2016