Making Chips Podcast for Manufacturing Leaders The Fight Against Nepotism in the Family Manufacturing Business with Dietmar Goellner
Jason and Jim both felt the need to fight against the perspective of nepotism within their family manufacturing businesses by proving their merit within their respective companies. Growing up in the family business had its perks, but it also came with the need to overcome the stigma that they were successful simply because of their bloodline. There was a lot to prove - to both themselves and others as they mastered the manufacturing business and took on greater leadership and responsibility. Guest speaker, Dietmar Goellner - Nick Goellner’s father - shares his own experience and insight into keeping nepotism out of the family business, while also mentoring his three sons within the company.
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The family business is still a businessDietmar grew up saturated in the heart and soul of manufacturing. His father immigrated from Germany in 1958 and founded Advanced Machine & Engineering (AME) in 1966. Dietmar is now the president, CEO, and co-owner of AME - as well as the president and CEO of Henning Inc. Dietmar was raised to become the next leader within his father’s manufacturing business, but he himself has taken a different approach with his own sons. Dietmar approaches the family business as a business - putting the needs of the company and team ahead of any desire to put a family member in a job where they may not need to be.
“Being in the family might get you a job, but it won’t keep you a job,” he says. Having a managerial role in the company with shareholding and voting rights is earned by merit alone. It’s not a birthright. Dietmar never pushed his kids to follow his footsteps in the family business, but when one by one they said they were interested in pursuing their careers within the company, he took them in and placed them where the company needed them most.
Each of his three sons joined the family business with unique talents, skills, and passions. Dietmar recognized this and placed them strategically within the company - where their aptitude met their passion and the need of the business. The needs of the company must be met - and that should come above the wishes of any individual. Treat the business like a business.
Less micromanaging and more mentoringIt is easy to micromanage any team - but especially a team made up of family members. Dietmar discusses the importance of fighting against the micromanagement of family members within the company. Coaching and mentoring are far more productive and impactful methods of training. Dietmar warns against ever forcing or coercing a person into a position that they either aren’t wired to take over or don’t even want in the first place. Not all family members who want a part in the business are going to want a leadership role.
Mentoring begins with assimilation. Dietmar explains that with his sons, he explained the opportunity to be had by joining the company, but he also explained that they had to earn the right to vote and own shares. He did, however, include them in board meetings so that they could watch and learn what would be expected of them in the future. He also explained the importance of allowing family members to make mistakes and allowing for communication to be two-way. Whether you are the mentor or the one being mentored, you have a responsibility to communicate well. For Jim, that meant booking his dad’s schedule with a time-slot just for the two of them to go out and get martinis together and discuss business needs. Be sure to listen to the entire episode for more great insight into what mentoring and coaching the next generation looks like and how to keep from micromanaging your business.
Fighting nepotism by sticking to your core valuesCore values are a key component of any company’s foundation. Dietmar encourages family businesses to communicate their stance against nepotism through their core values - and the determination to stick by them. At AME, the core value of servant leadership is vital. Anyone not displaying the humility that comes through leading by example is not considered for a place within the business - whether they are family or not.
Arrogance and ignorance are two attributes that Dietmar doesn’t allow on the manufacturing floor. While he recognizes that everyone has flaws and that no one is perfect, he understands the importance of a humble and knowledgeable leader. When considering whether to promote someone - whether family or not - he looks to see whether the individual embodies the characteristics of a servant leader and also displays the manufacturing skills necessary to take the business to the next level.
Dietmar explains that another aspect of a successful and healthy family relationship within a family business is respect. He warns against losing respect for one another over business issues and by not treating each other with professionalism in the workplace. Yes, you are family, but that doesn’t mean you can get away with disrespecting one another.
Have a succession plan - but hold it looselyHaving professionals come onto the board to help navigate succession plans and other business dynamics is hugely helpful. Dietmar suggests having an excellent attorney on board to ensure that you are getting it right when it comes to the details. Beginning the conversation early with family members about how the succession plan will work for the family business is important.
Dietmar reminds listeners that arguments and misunderstandings will occur during the succession planning process. Be okay with that. Go in knowing that there will be miscommunication. Hold everything loosely and operate under grace. Be able to ask for forgiveness and forgive. Building a strong family connection while also making the right decisions for the future of the company can be difficult. Dietmar suggests that if there isn’t someone in the family who wants to take on the business, then look within the company for someone passionate and capable who does want the responsibility. Open communication and honesty should be the foundation of any succession planning.
Be sure to listen to the entire episode for more helpful pointers on how to navigate the ups and downs of working with family in the family manufacturing business and how to keep nepotism at bay.
Here’s The Good Stuff!- The birth of The Boring Bar at MakingChips.
- Defining nepotism.
- Dietmar Goellner: president/CEO/co-owner of Advanced Machine & Engineering.
- Is it wrong to give your family jobs in the business?
- The issue of reverse nepotism.
- Placing family members in jobs that will impact them and the company.
- Less micromanaging - more coaching.
- Relating core values to the issue of nepotism.
- The dangers of arrogance and ignorance.
- Building strong communication between you and your family within the business.
- Don’t lose respect for one another!
- Having the succession conversation - and being willing to flex.
- MakingChips Bio
- Dietmar on LinkedIn
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