The fact that Wheeler was outside the company for a decade in the joint venture gives him some advantages: as an inside-outsider.
Wheeler is intimate with the skills and insights of Richard Pratt, a tough, skilled leader. But his decade-long distancing means he is not part of the “inner circle” of advisors that many next-generation leaders see as proxies of the old guard.
Says FBA’s Taylor. “We often find, from our research, that when a transition takes place, the senior advisors are the first to go. The next generation is champing at the bit to put their own imprimatur on the business. If they keep on the financial advisor, for example, it is like having Dad around.”
Outsider risk
Richard Pratt’s succession plan for his businesses was very well thought out. Three children of his children ended up as leaders of parts of the family business empire – a characteristic of many family businesses – but Pratt appointed them five years before his death in 2009 at age 74, to make sure they were up to the job.
When outsiders are appointed to run family businesses, jobs for the family’s children is a common source of friction. Outsiders, being independent, will question the skills, experience and ability of family members to hold leadership roles, and may refuse them.
When the board is still controlled by the family, all hell can break loose. There is no simple solution. When the family chooses to employ its own, they risk more than the potential for incompetence: talent tends to flee companies in which leaders are appointed for who they are and not what they can do.
However, family boards that have the courage to appoint an independent leader face the risk of testing familial relationships. Intense conflict is not unusual.
A chip off the old block
So, if Wheeler is a chip off the old block, what are some of Richard Pratt’s qualities that he could restore to the company?
Pratt senior was renowned as:
