As a child, Aleeza Singh watched “Wall Street Week with Louis Rukeyser” with her family and stood on a bucket reading the Wall Street Journal at the instruction of her father, Tony Singh. Now, about two decades later, she’s been with her family's wealth management business, the Singh Group, for 12 years, including three working part-time in college.

“Slowly, from standing up on a five-gallon bucket, to then going and being on the stage with me, then me standing in the background, and now, finally, she does all the public speaking for our business,” Tony Singh said of his daughter, Aleeza. “It was a process, and she had to earn it.”

Whether talking about the transition and development of individual responsibility at the Singh Group or looking at the broader plan for succession from father to daughter, one thing remains constant: As Aleeza Singh put it, “it requires a ton of patience and a ton of tears.”

That leadership at the wealth management group will be handed from one generation of the family to the next makes sense; the Singh Group's "main offering" is working with multigenerational families, so both Tony and Aleeza Singh said it's crucial for the company to plan for everything through the lens of multiple generations. 

“We have families that are four generations deep,” Tony Singh said. “It lends into having a wealth management team that’s also multigenerational. It just makes sense.”

While the company's succession plan is based on a formalized, written plan between the two — including merit-based benchmarks for client retention and asset growth — Aleeza Singh said the nature of wealth management requires she earns clients’ trust and respect on her own terms.

“When you pick somebody to help you navigate your finances, that’s a huge decision,” Aleeza Singh said. “Aside from your spouse, or maybe your physician, these are the types of relationships that are usually lifetime, and you’re really making some of the most important life decisions with this person.”

The Singh Group is affiliated with Merrill Lynch Bank of America Corporation. While Merrill Lynch has a protocol available for its affiliates, Aleeza Singh said she and her father decided to do their “own thing,” which involved a “strategic pivot” to splitting labor by responsibility rather than by client. She and her father look at finance through “different lenses,” she said. Her father said the unconventional split allowed his daughter to immediately work with — and develop relationships with — all of the 100 or so families they manage and allowed him to develop his strengths in a more focused way.

“In the long term, I’ll be happier, and I can contribute more to my client’s well-being and our practice’s well-being by focusing on the things that I’m good at and doing it for a long period of time,” he said. “I can do it until the age of 80 or 90 if I’m around. I’m going to do it for as long as I can, and I’m happy doing it.”

As ownership shifts, Aleeza Singh said she and her father will eventually work up to being “true partners.” Ultimately, he sees himself as more of a chairman of the board or an advisor and his daughter as CEO.

Between episodes of “Wall Street Week” and practicing her public speaking, a younger Aleeza Singh was “dragged” along by her father to another part of his world: clients’ funerals. While it was the “last place” she wanted to go as a child, she now recognizes it was a testament to the sort of relationships forged in her father’s line of business.

“He got them through to the end, and if there are multiple generations, he was around to support the family. You start to see it differently after a while,” she said. “… When I’m 50 or 45, I’m going to have to think about who’s going to carry that torch beyond me. It’s very important for anybody in any sort of business that’s relationship-based to think in terms of generations.”

Per Mar Security Services

Ask Michael Duffy about how to plan for succession in a family-owned business, and the 69-year-old CEO of Per Mar Security Services fairly charges out of the gate.

He's given years of thought to this topic, as the Davenport business founded by his parents in 1953 has grown and changed and he prepares to hand off to a third generation.

Duffy knows the pitfalls. People who start a business are passionate about their work and do what it takes to succeed. But by the third generation, there may be a sense of entitlement.

While a majority of the nation's small businesses are family-owned, some 70 percent do not survive into the second generation, according to The New York Times.

"The statistics are terrible," Duffy said.

The goal with succession is to prevent the business from destroying the family and vice versa. "It doesn't just happen — you have to work at it," he said.

So how has Per Mar continued to thrive from one generation to the next? Here are six guiding principles Duffy has honed through the years.

Get advice, seek out best practices

Duffy took over from his dad when he was just 26, so he joined a group called the Young Presidents' Organization, founded in 1950, as a way to share ideas with people facing similar challenges.

He subscribes to Family Business, a magazine targeted for multigenerational family businesses that provides advice and thought leadership.

And Per Mar sought out seminars with a company providing a mix of psychological and business counseling to family companies.

Separate ownership from management

The business and personal must be separated, and family harmony should come first, and business second.

Also, "even though the family owns the business doesn't mean the kids can come in and look through the drawers on weekends," Duffy said. "This isn't our own little honey pot."

Schedule regular meetings

For Per Mar, this is an annual meeting that includes spouses and a facilitator, plus a lawyer, accountant and key employees of different divisions.

Set up an advisory board with outsiders

"Otherwise, there's no checks and balances on the family," Duffy said. "It's better to have people question you." A group with a diverse set of business experiences can provide invaluable, occasionally even thorny, advice and can keep the business focused, he said.

Work somewhere else first

Children who want to work in the company must work three years somewhere else first, and they must get a pay raise or promotion during that time.

Parents also must be open to the possibility that children may want a different kind of career entirely. "It's not bad if a child doesn't want to go into (the family) business," Duffy said. "He or she should not be made to feel guilty."

Grow your business

To have succession, you have to have a business worthy of going forward.  Duffy has on his computer a list of 48 tips for success. Among them are "Always say 'please.'" "Always say 'thank you.'" "If a customer wants brown shoes, give them brown shoes." "Have a sense of urgency."

"In my opinion, the culture is the No. 1 thing," Duffy said. "I think the culture of any organization is shaped by the worst behavior the leadership of the organization is willing to tolerate. The minute you start bending the rules, you get into trouble." 

-Alma Gaul

Von Maur

Jim Von Maur’s retail career began far from Davenport. The president of Von Maur, based in Davenport, initially followed in his father’s footsteps and went to Maine to learn the business on the sales floor, first at the now-defunct Marshall Field & Co., then Nordstrom.

Less than two years later, he was ready to join the family business.

“It was a kind of ‘bottoms up’ training, which was really beneficial for me,” he said. “I started off selling shoes, then men’s sportswear, and I worked my way up through the different management positions. That was maybe a 10-year process.”

And he hopes the company's next president would follow a similar trajectory.

“If you’re here making a decision at the office, how is that going to translate into reality? You’re not going to know that if you haven’t lived it and been there and know what it’s like to be a sales associate,” he said. “I think the worst thing you can have is an executive or a leader who doesn’t truly know how the business runs. How it runs on paper is totally different from how it runs in reality.”

Starting off with other retailers helped Von Maur recognize what worked and what didn’t for other businesses: Marshall Field had been bought and sold many times, which he felt muddled their focus. But Nordstrom was much closer to what the family business was striving for: It was “all customer, customer, customer-focused,” with high staffing levels to encourage floor coverage and one-on-one salesmanship.

While the Von Maur family is a small one — in addition to Jim, it’s just his uncle and a cousin, who’s on a similar path he was — all of the executive trainees gain experience on the sales floor.

“I’d say the vast majority of our executives, senior management and middle management have come from the stores,” Von Maur said.

While some semblance of a plan was in place for Von Maur to eventually become president of the company — which he did in 2001 — it wasn’t always a given.

“If they felt I hadn’t been up to the job, I probably wouldn’t be here,” he said. “Just because you’re a family member doesn’t mean you’re in a leadership role. You have to still prove yourself.”

The leadership is one thing Von Maur credits for the success of the retailer, which has 33 stores in 15 states.

“With a family business, you may have one or two leaders in there for quite a long time,” he said. “You don’t get these new CEOs and presidents that want to come in and put their mark on the business and start changing things, and then everyone has to adjust to those changes. I think the continuity you get from being a family business is a great advantage over a public company.”

Being a private company has other benefits too, including making business decisions based on long-term sustainability, rather than trying to continuously grow the bottom line.

“When you get all these other forces influencing you, you start to lose sight of the customer — Wall Street, a board of directors, they’re coming from different areas. You’re going to get pressure to do things that may not be good for the long term,” he said. “The minute your little penny per share earnings is off, you get punished on Wall Street. I think it’d be very difficult for an existing retailer to initiate some of the things we do that make us different. I think the cost of it would be prohibitive for a public company.”

Without that outside pressure, Von Maur is able to invest differently, including putting more money into maintaining and updating existing stores instead of building new ones, and having a higher sales payroll, not only because they pay their sales team “more than what’s typical,” but because they hire a lot of them.

“When your name is on the building, you take a certain pride in that,” Von Maur said. “That makes a huge difference.”

-Megan Valley

Hawkeye Commercial Real Estate

Company leaders David Gellerman and his brother-in-law, Jim Tansey, agree fourth-generation family members should work for someone else before joining the family firm.

Both joined one of the family's businesses out of college. Gellerman started at Jaydon at 14, sweeping floors and stocking shelves. After he finished college, he followed the footsteps of his grandfather, Herbert Gellerman, who founded the company in 1947, and his father, Jay, who joined it in 1962 after college and military service.

Gellerman and Tansey now run Hawkeye Group, a company Herbert co-founded in 1962 as a publicly traded real estate firm. Jay also worked for Hawkeye Group, and eventually bought out the partner and took it private. Under the third generation's leadership, the company expanded property management offerings and added real estate brokerage.

“Every boss I’ve ever had has had the same last name as mine,” Gellerman said.

But Jaydon was a large company — 600 employees in multiple states — so he spent years traveling to company locations in Oklahoma and Kentucky.

But he was always “the boss’s kid," Gellerman said, so he had to learn to have two relationships with his father: boss during the day, and dad after hours.

Hawkeye has only 12 employees, and Gellerman and Tansey want their children to work for other businesses first before they join the firm.

“My kids have had other bosses not related to us, and that’s good for them," Gellerman said.

They also want their children to report to someone other than their father, and to be placed in a job for which they're qualified.

That happened naturally for Tansey and Gellerman — one was the numbers guy, the other the people guy — but they eventually hired a consultant to help the leadership team through a strategic planning process. That process evaluated the company leaders, assessed their strengths and weaknesses, and ultimately confirmed the natural roles for this generation of the company's leaders.

But it showed them “this is what your strength is, and this is what you need to do," Gellerman said. It was also important, he said, to understand their children's skill sets so they will find a good work fit too.

Anything else would be setting them up for failure. 

"They should be put in a position to succeed," Tansey said.

-Alma Gaul

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