I write this against the backdrop of having just announced that my son, Toby, has taken over as CEO of The Bozzuto Group. I thought it might be useful to explain in here some of the thought process that went into this change and in addition, talk about some of what I’ve learned from this.
As one of my colleagues recently put it, for many family businesses succession planning is the proverbial elephant in the room. My observation however is that this statement is true of all businesses where the senior person has reached or is approaching a certain age; it’s just more so for family businesses. But in every business where the question of succession is in the air, the longer there is an absence of clarity or direction, the greater the energy that gets wasted by employees worrying about the issue.
In any event, in the case of our company, I only began thinking of us as a “family business” about eleven years ago. By that time my son had been with us three or four years and had demonstrated that he not only liked the business but he was quite good at it. In order to figure out what I was dealing with, I began talking with others who ran family businesses, including those who had taken over a business started by their father or mother as well as some that were planning their own succession to a family member. It turns out that there are a lot of family businesses in this country, and an especially large number represented in the real estate industry.
At the recommendation of one family that is in its third generation and has handled transition remarkably well, Toby and I, together with my business partner John Slidell and his son Duncan, went to a program at the Harvard Business School, entitled “Families in Business.” This program, like its counterpart at many other universities around the country, could be subtitled, “And How Not to Let One Mess Up The Other.” For while there are many dysfunctional companies in America, there are probably even more that have to be intermixed with the complexities of family relationships.
The program was absolutely fantastic. And to a very large degree, we have followed what we learned there to make sure that this change occurred not only in a timely fashion but also with as little disruption and surprise to any of our constituencies as possible.
Other than Toby proving his abilities to his colleagues and me, we did one more important thing to ensure that this change would be accepted, and in fact, expected. To anyone who was in the least bit interested, both internally and externally, we made sure to send clear signals that at some point this change was going to happen.
In that regard, the company is better positioned today than it ever has been for a leadership change. We are in the middle of our 28th year. We have had continued and steady growth. Since the recession ended, we have enjoyed consistent financial success. We have a team of leaders who has been with us, on average, seventeen years and almost twenty percent of our workforce has been with us for more than seven years. In addition, both my fellow company founder, Rick Mostyn, and I intend to continue to work with Toby. Rick will continue as COO and I will remain Chairman of the company and continue to oversee asset management.
However, I have no doubt that Toby is ready to take over the company. He has been with us for more than 14 years, better than half the company’s life. He understands and is committed to our values, our relationships and our history. He is a skilled leader, bringing great energy, creativity, enthusiasm and innovation to the company. Under his leadership, the company started more apartment properties in a shorter time frame than at any other in our history. He is clearly ready for, and up to, the task.
To make sure our employees know that Toby really is going to be running the company, I have taken an office in a remote location, separate from the corporate office, where I expect to spend at least some of my time. More symbolically, but to the same effect, on the day of the announcement and in front of all our corporate employees, I handed Toby a wooden ship’s wheel that my parents had given me years ago when I had my first job running anything. He is truly and deservedly “at the helm.”