Blood is thicker than water, but the livelihood of any family business depends on far more than DNA. It’s not always easy to protect and build the family jewels while avoiding a family feud. We ask the custodians of three iconic Australian family empires how it’s done.
Glenn Cooper AM
Executive Chairman and Marketing Director,
In the 1970s, Glenn Cooper’s father discouraged him from entering the family business, believing the Adelaide-based brewery was unlikely to survive long-term. Cooper took the advice and established a successful computer sales and service business. The brewery pulled through and Cooper came on board in 1990, along with cousin Tim, a cardiologist. The pair took over the top jobs in 2002 and, as fifth-generation Coopers, strive to maintain the balance between history and innovation.
I loved selling personal computer systems and I’m happy to say I learnt to sell in the gutter. It was tough. Having my own business taught me a lot, especially when my house and personal property was on the line. You can’t always get those experiences going straight into the family business. Go out into the world – you learn a lot more.
When Tim and I joined the brewery, our immediate bosses were ‘non-Cooper’. I believe that was deliberate, not to bring us in over the top of anybody. You come in with the name Cooper and it’s hard on some employees.
Our history and status as a family business was a huge factor in surviving the takeover attempt by Lion Nathan in 2005. It showed up with the Coopers, and also with the ‘family shareholders’. After five generations, some of them are a bit spread, but loyalty and history played a large part in the shareholders’ solidarity. They believed in the past and they believed in the future.
I’m 56 and I don’t want to retire early, but I don’t want to retire late. We don’t have a particular succession plan in place. There are too many variables to make it stringent. But if something unexpected happened to me, we have strong business structures in place so it doesn’t fall over. When the fifth generation came in, it was our job as custodians to make the business stronger, so it’s in a better position to pass on.
We want to see the next generation taking over, but it’s dangerous for family businesses to tell children and siblings they’ll come into the business. It can take away the drive to achieve their personal goals, as part of creating their own life.
Growing up with the construction business in his blood and board meetings at the family dinner table, Daniel Grollo, 37, now sits comfortably at the helm of construction giant Grocon, founded by his grandfather in the 1950s. Starting out as a carpenter 20 years ago, Grollo worked his way through on-site construction and leadership, to marketing and general manager responsibilities. In 1999, Daniel and brother Adam took over as joint managing directors. Now CEO, Grollo and his workforce of up to 1,500 employees transform city skylines around the country.
I took it for granted that I’d work in the business. I was never really cognisant of doing anything else. But there was no succession planning whatsoever. Like many family companies it was informal, without much structure.
Adam came to the managing director role from a financing, administration type background. I came from a more practical hands-on and marketing, management role. This wasn’t intentional, it was quite organic.
Sharing the managing directorship can be complex because each person has to be comfortable with their area of responsibility. If you’ve got that comfort and that confidence, it can work quite well because sometimes a mixture of personalities can be a good thing for leadership.
Adam stepped back from the business, so I took on more responsibility. I’ve grown into the role. We’ve been fortunate to have a good mix of long-term, very loyal people and we’ve added some very constructive and smart people along the way. I think that’s made my journey to CEO a much smoother ride. Having good people around you is critical.
Family companies have good points and bad. While the loyalty is a really positive element, getting the right leadership structure becomes more complex. Issues of tenure and proximity to the leadership can confuse the reporting structure. Working on that is of key importance.
Succession planning is something you can have some principles around, but you need to continually revisit those principles to align them with the quality of the individuals and the business objectives of the day. Like so much of top echelon leadership, I’m not sure there’s a fixed rule.
Managing Director, Nugan Group
In his final stages of life, Michelle Nugan’s husband Ken requested she take over the family fruit and vegetable juice manufacturing and packing business. With limited business experience, she stepped up to the plate and over the next 20 years turned the faltering business into a $75 million empire, diversifying into premium wine and olive oil production. Now 64 and based in Griffith, NSW, Nugan is ensuring two of her children, Matthew and Tiffany, are better prepared for life at the top.
When Ken died, there was no succession plan. My sons, then aged 20 and 22, were working in the business. He asked me to take over because he could see the potential for conflict between them. They were different personalities. But putting me in the key position also created conflict. Succession planning is about sorting out these issues and minimising conflict.
Robert, 41, left the business 16 years ago. He wanted to be his own keeper. Matthew, 43, recently took over management of the wine business at Nugan Estate. He’s got a couple more years of grooming before he can hit his straps ‘ in his own way, but also in a very professional and commercial way.
Anyone taking over a top job needs to understand global commercialism and how to conduct themselves in important business meetings. Matthew’s out there rubbing shoulders with people all over the world, not just in Griffi th or Australia. That’s experience you can’t teach somebody. Tiffany, 33, is also working her way up. She’s Marketing Manager at Nugan Estate.
Succession planning doesn’t only relate to key positions. As senior management gets older you need people under them being trained to take on that responsibility. This is more important in rural Australia. To attract people from the city, you need to offer upward mobility.
I don’t think that by grooming Matthew and Tiffany for the top jobs we’re limiting our ability to attract other top managers. I’m training them as much as possible, but ultimately the person at the top has to be capable. A lot of family businesses fall by the wayside because they say, ‘Well, my son or daughter is the best person for the job’, when they’re not.