Executive Search for the Real Estate and Construction Industries

Hot Candidates

Corporate Real Estate Manager
Responsible for all aspects of real estate management, lease negotiations, acquisitions/dispositions, site selection and supervision of consultants and in-house staff. Candidate is in Southern California.

Construction Manager (Transportation and Infrastructure)
7+ years experience. Candidate is in Northern California. Experience includes work with Caltrans and numerous other public agencies. Candidate has extensive claims and scheduling experience. Salary is $100K Candidate is in Northern California.

Construction Manager
15 plus years experience with numerous school construction management experience. Experience includes extensive claims analyisis and scheduling. Candidate is in New York

Senior Construction Manager (Golf Course Development)
10+ years golf course construction. Candidate is in Northern California.

Senior Living Construction Manager
10 years experience. Candidate is in the Chicago area.

For more information about one of more of these candidates, contact John Kreiss at jpkreiss@morgansullivan.com.

Don’t Put Off Developing a Succession Strategy
By John P. Kreiss, President, MorganSullivan

Few of us want to face life’s inevitabilities— death and taxes. Most business owners and executives would add another thing to that list: planning for the future of the company after they retire.

Every company that expects to continue on after the founder gets out of the business must have a leadership succession plan. This applies whether the departure is planned or involuntary. Too many business owners, however, neglect this basic element of running their business.

Family businesses, especially first-generation firms, are especially vulnerable. Only 30 percent of family- run companies today succeed into the second generation. Just 15 percent survive into the third. The reason for failure in most cases is the lack of an orderly succession plan. Developing such a plan isn’t that difficult, but it does take some time and commitment.

Start early
Owners should begin succession planning while they are still healthy and active in their enterprises. Many experts advise people to wait no longer than their mid-50s to begin this process. In addition, every established business should have contingency succession plans in the event of the death or disability of the chief executive.

Succession planning for business owners may involve establishing the legal and financial terms for ownership transition. [For more information on this topic, see this SullivanKreiss Financial newsletter.] For all situations, succession planning requires designating a successor, providing that person with the training and guidance to handle the reins when the boss leaves, and gradually handing over responsibility to the new leader.

These matters can take years to accomplish and require difficult decisions. That’s why you need to allot at least several years to plan properly.

Who’s next?
The dynamics of choosing a successor depend upon the nature of the company. In a family-owned company, the owner’s preference is typically to leave the firm to his or her children. If there is more than one candidate from among the offspring, choosing one successor can be difficult and fraught with emotional land mines. It may be possible to divide leadership responsibilities so that each child interested in continuing on in the business has a satisfying role.

Whether it’s a family member or someone else, the successor to the chief executive’s role has to be qualified and able to take over the helm. If nepotism trumps ability in the decision, the consequences for the company may be dire. It does nobody a favor to put him or her in a position that they cannot handle.

Make sure that the successor has the right stuff. Evaluate each candidate according to these factors:

What are the individual’s technical and managerial skills?

What are this person’s strengths and weaknesses?

What needs to be done to prepare this candidate to step in?

When will this potential successor be ready to take over?

Ideally, your most likely candidates have already received some grooming and have displayed the potential for leadership. The chosen successor should understand the business thoroughly and display the people and leadership skills necessary to run the organization. If no one completely fulfills these requirements, pick someone with the raw ability to learn and develop what he or she lacks.

If you leave enough time for the succession plan, you may be able to test potential successors in different roles, providing them with more responsibility. You can evaluate their maturity, business sense, and leadership acumen. A logical successor might emerge from the ranks of a few contenders.

Paving the way
Handing over the reins should be a process rather than a single event. Ideally, the leadership transition occurs so smoothly that employees scarcely notice it happening. The successor should gradually assume more responsibility. During this time, the most difficult thing for the current leader is to slowly step away and allow the successor to make some key decisions. If you’ve chosen the right person, you have to trust that in the long run he or she will make the best decisions for the company, even if you don’t agree with every one of them.

During the transition, focus on areas likely to be unfamiliar to the successor. Make sure he or she is exposed to all the issues that the boss has to deal with—strategic planning, personnel decisions, crisis management, dealing with unhappy clients, etc. Let the successor, with your guidance, tackle these issues as soon as possible. Experience is the best instructor.

Making the handoff
It’s best for the well being of the firm to have openness in the leadership transition strategy. Don’t keep everybody in suspense after you’ve made your decision.

Minimizing uncertainty surrounding leadership transitions requires more than simply naming successors. When a firm’s founder(s), who may have defined the firm’s direction for decades, plan to step aside, it’s important for the successors to clarify the company’s core values and strategic direction. With first-generation firms, in particular, which often depend on the personalities and leadership of the founders to set strategy, the second generation should reveal early whether they will continue in the same direction or chart a new course.

John P. Kreiss is President of MorganSullivan, an executive search firm serving the real estate and construction industries.