African Americans finance home ownership. Paul’s sister Karen, 52, serves as marketing director and also does interior design for the bank’s four offices.
Paul’s preparation for eventually heading the company came in 1981 when he joined the firm as a teller. “It was the old model of starting on the ground floor, learning all aspects of the business and working your way up,” he says. It was Elbert’s wish that his “heir apparent” come through the ranks of the business as opposed to taking the helm just because he is a family member.
And Paul agreed. “I was open to starting as a teller. I thought it would build respect among the other employees. It also builds confidence in the staff that you are really qualified. I had to balance my books everyday like every other teller and I felt an obligation to work harder and to be better. I didn’t want anyone to think I was getting any favors,” he admits.
Another key to a successful succession, says Elbert, is making sure that the child actually wants the job and has proper preparation. “[Paul] did all of the various jobs: teller, loan services, savings department, and the loan department. He was pretty well schooled [in the business]. It took him almost 10 years to be ready.”
But that doesn’t mean that things always worked smoothly. Paul admits, “I find that most of our disagreements result from the fact that I didn’t communicate something to my father, like a large pending loan or a new product. You don’t want your father to hear of a big issue for the first time
at a meeting. Surprises equal problems. Frequent and open communication is required.”
Ascending to the top is also a question of timing. And Paul admits that there were times when he became impatient with his father’s succession plan. “The young person usually wants to takeover before the parent is ready to step down. As I look back, had I been made CEO when I wanted to be made CEO, I would have probably made a lot more mistakes. You have to be able to talk through your strengths and weaknesses. There needs to be a transition when you’re given more and more responsibility as opposed to a big leap from not much responsibility, to hands-on operational experience, to taking over the business,” Paul says.
And making a change isn’t simply a matter of telling everyone, Elbert warns. “Announcing a transition is one thing, but implementing the management changes is another. The parent needs to make sure he [or she] is still alert. Get out while you are still capable of making good decisions, and can advise the new leadership in a positive frame of mind.”
Another tip: “You can’t continue to micromanage the company after you step aside.”
Paul acknowledges that he hasn’t thought of a successor. “If you have children, you can’t guarantee that they are going to go into the business. You can’t force them. That’s a recipe for disaster,” he asserts.
Family-owned businesses will continue