The Succession Coach

Family-owned Powell's Books brought in outside help to handle an important inside transition.

The Company:

Powell’s Books, a Portland-based, family-owned independent bookseller with 550 employees and $58 million in sales.

The Practice:

When founder Michael Powell decided several years ago that his just-out-of-college daughter, Emily, would succeed him in running the company, he brought in Mark Green, former director of Oregon State University’s Austin Family Business Program, to bring her up to speed — but with sufficient time to develop the skills and earn the respect of her new colleagues. Under Green’s direction, Emily worked three positions at the company to prep for her new role as president — which she takes over  next year when her father retires.

The Formula:

1. Start early.

   Emily Powell talked to Green, a coach in family and succession issues, often when she returned for a summer to work at Powell’s after earning an undergraduate degree in urban planning. Green recommended she leave Portland and get a variety of business experience before returning to learn the ropes. So Powell headed to San Francisco to work as a pastry chef, as a commercial real estate broker, and as a manager of a lingerie shop.

2. Take advantage of outside counsel.

   Emily faced a variety of complicated challenges she had little control of -- employee resentment over nepotism, the pressure of being the boss’s daughter, and high expectations. “A lesson you learn early on in a family business is it is challenging even in the best of circumstances,” she says. “At another company you’re not going to go to Thanksgiving with your boss or sit at the dinner table with shareholders. There’s a tendency in family businesses to give raises that aren’t merited and promote people who aren’t ready.” Green helped ensure that that didn't happen.

3. Pay your dues.

   Green advised that Emily work her way up to her role as chief and get paid in her jobs equal to any other Powell’s employee. Obviously, she’d rise in the company faster, but she still did the time, starting at entry level in marketing, doing data entry and interacting with customers by answering questions about their newsletter. In 2006, she moved on to the used book business, studying what sells and why, how many copies to keep on the shelf at a time and how to make that business more profitable. She’s now a vice president. “Mark’s held our hand the whole way,” Emily says. “It’s been invaluable.”

   Join the Bizmore discussion: "When should I bring a family member into the business?"

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