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Passing the keys

Family businesses have unique generational challenges.

(page 2 of 3)

Gordon Flesch Co. Inc.

62 years old

Patrick Flesch, 37, is the grandson of the company’s namesake. He and his brother Mark represent the Gordon Flesch Co.’s third generation, and their young children, the fourth. The second generation, brothers Tom (Patrick’s father), John, and Bill, remain heavily involved. The family has three offices — in Madison, Illinois, and Ohio — and employs 589 workers, including about 300
in the Madison area.

The second generation of the family Flesch includes (standing, left to right) brothers Bill, Tom, and John. Seated, generation three is represented by brothers Mark and Patrick.

Patrick and his brother Mark are also best friends and share the same titles, vice president of sales, in two different divisions: Patrick handles the western region and Mark the east. There are no female Flesches involved in the business. Patrick and Mark were raised in Columbus, Ohio after Gordon sent his dad there to open a branch. Mark still works there.

Patrick recalls how hard his father worked and the long hours he put in. “Friday nights we’d have dinner with dad in the office, sitting in demo rooms surrounded by big copy machines and usually eating pizza.” He also remembers feeling unique in that he recognized that the family was privileged and lucky that it had a company, “but I didn’t know how successful that company was,” he admits.

Grandfather Gordon, meanwhile, instilled a rule that family members wanting to join the business would have to earn a college degree and spend at least three years working elsewhere before applying. After college, Patrick found a job as an inside account manager at CDW in Chicago and loved it. “I was young and single and working in downtown Chicago when I got a call from Tom saying a territory had opened up in the Oakbrook/Elmhurst area and they wanted me to consider it.”

Now he’s at the Gordon Flesch Co. indefinitely, “and not just because I’m a Flesch,” he insists. “I love the technology we sell, I love our customers, and I love the people here.” The average employee tenure is 10.4 years, he reports, and “that’s a testament to Tom, John, and Bill’s leadership. Hopefully Mark and I can continue that forward.”

What about his kids, ages 6, 4, and 1? “It would be a dream of mine to see them join the business,” Patrick acknowledges. “As exciting as it may be to have your children in the business and transferring the company to the fourth generation, that comes with a lot of work and pressure. I want them to do what they want to do. Let them figure it out.”

A portrait of founder Gordon Flesch.

He admits there are challenges inherent in family business: “I really think it’s helped our company that people are located in different states and we don’t see each other every day. When you’re in the office every day with your family members, I think conflicts can become more prevalent.”

There’s also the challenge of non-active family members, he notes, who are always invited to the annual board meetings. How much do they want to know about the company? Do they care? When it comes to finances and making sure that everyone is taken care of, do silent members get the same breakouts?

As far as a company succession plan goes, details are not yet known to the brothers in generation three. “If there is one, Mark and I aren’t privy to it,” Patrick notes. “I assume they have a contingency plan should something happen to Tom. Bill, the youngest of the three, might be the natural option,” he suggests.

But just to be safe, Patrick notes that company executives often travel on separate flights to company meetings because “having all the top earners on one plane is not a good situation.”

So what would grandfather Gordon say now? “I think he’d be proud,” Patrick says. “He used to tell Tom, John, and Bill that he dreamed of making a top line revenue of $10 million. Now we’re at $155 million.

“He’s got to be smiling.”

Reynolds Transfer and Storage Co.

130 years old

Back in 1888, Anna Gault Reynolds started a livery stable and hauling firm with four rigs and 10 horses and operated it out of a barn next to her house on East Mifflin Street. Until recently, few women have held corporate roles in the Reynolds family business. Mom Michelle plans community outreach and social media while Natalie Evans, daughter of Michelle and Tom and twin to their son Ben, has taken an active role as director of information. Tom, Reynolds’ president, is thrilled. “We’ve never had a daughter come into the business,” he says. “I’m proud of that generational change.”

The Reynolds family bloodline includes generations five, six, and possibly, seven. Left to right, Benjamin, Eli, Madeline, parents Tom and Michelle, Michael, Natalie (holding baby Nell), and Garrett.

There could be another, as well. Natalie’s six-month-old daughter, Nell, represents the company’s seventh generation.

Tom and Michelle represent Reynolds Transfer and Storage’s fifth generation, and their six children comprise the sixth. Ben, director of operations, Eli, 27, vice president, and Natalie are actively involved full time. In addition, a sister, Madeline, age 23, a student at UW–Madison, brother Michael, 20, and Garrett, 16, who still is in high school, have all worked for the company on a part-time basis.

“We’re very fortunate,” Ben says. “Everyone likes each other.”

After all, there’s a certain expectation involved in being a part of a 130-year-old business. “It’s pretty awesome,” Ben admits, “but comes with the responsibility to see that it continues to grow, thrive, and provide incomes and livelihoods for our employees.”

The company, he says, is working on a succession plan — again. They started the process about five years ago before Ben’s dad Tom and Tom’s brother Mark decided to go their separate ways, creating a separate business, Reynolds Rigging & Crane. The decision was amicable, but that sent the family back to the drawing board on succession planning.

With the help of the Family Business Center and Smith & Gesteland, succession plan talks have resumed. “We kind of forgot about it, to be honest,” Ben admits. “Now we got the necessary kick in the butt to get back to planning.”

Above, Anna Gault Reynolds founded Reynolds Transfer & Storage on East Mifflin Street in Madison. Below, Reynolds Transfer moves a portable stone crushing machine in the 1940s.

Ben says one of the biggest challenges is leaving business matters at work. “Not only is it a family business but any business owner gets stressed out about owning a company that goes to a different level than being an employee.” Ben, like Natalie, spent time away from the company before choosing to step back in, but one of the things he loved most about working for another company was being able to walk away at the end of each workday.

“Here, there’s always a concern about money, or utilization, or other fires,” he explains. “We’re a service company. We do moving and storage, so we’re always trying to help our customers, but it’s very tricky to be the right level of busy. We’re almost always over or under booked. It’s hard to be perfectly booked.”

The cozy notion of family members being in contact throughout the workday does not hold true at Reynolds, he explains. “Often times I don’t see my other siblings or my dad, so if something happens it’s hard not to talk about it at home. Even though we share offices, we’re usually busy in our own roles.”

There are benefits, too. “It’s fun to work with family,” Ben states. As investors in the business, the younger generation can influence the company’s direction and focus on issues they deem important, such as Reynolds’ commitment to charity work and sustainability as a long-term strategy. “That may not happen if you’re just interested in quarterly profits.”

Since joining the company, Ben and Natalie made vast improvements to systems and processes, switching from paper-based to electronic systems that have saved administration time and modernized the business. Natalie, who has a master’s degree in library science, handles accounting work, record storage, and organization. “In addition to our record storage division, we have about 170,000 square feet of storage space, so you do need to have a good record-keeping system to know where everything is,” Ben states. “She’s more like a data scientist than a librarian.”

Ben has an undergraduate degree in industrial engineering and a master’s degree in manufacturing systems engineering from UW–Madison, while brother Eli excels in project management.

Their father, Tom, says they’re doing things differently these days. “We’re striving for better communication so the next generation feels some ownership.”

As he looks to the future, Tom is confident in his kids. “I think they will help the company stay vibrant. I’ve learned a tremendous amount from them as their father. I wasn’t ready for that. Sometimes it’s difficult to listen to their suggestions but they do have great insight into what others out there are doing. I have to make sure I listen.”

He worries about the availability of future workers and admits things won’t be easy for his kids. “I know the challenges family businesses face. Will two kids end up in the business, or all of them? I have no idea, but they all know they need to work hard.”

Leading a multigenerational business is humbling, Tom admits. “I try to impress on the employees that many people have worked very hard for a long time so we can have the opportunities we have every day.”

(Continued)

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