Gail Miller co-founded a Toyota dealership with her husband Larry in 1979, but didn't take an active role in the business for many years. Larry ran the company and made all of the decisions, and before he passed away in 2009, he appointed his eldest son Greg as CEO of the Larry H. Miller Group of Companies. However, he didn't leave behind a succession plan to help the next generation share power and make collaborative decisions effectively. Recognizing that the family needed guidance in the areas of corporate governance and succession, Gail and her sons attended the Families in Business program at HBS Executive Education. In this interview, she and one of her sons, Steve Miller, share what they gained from this learning experience.
What attracted you to the Families in Business program?
Steve Miller (SM): Our family business was founded in 1979, and for years the founders made all of the decisions. For the longest time my generation seemed like we were along for the ride with my Dad making all the decisions about how capital was deployed. In 2008, several months before my father passed away, he made my elder brother, Greg, the CEO of the company and gave him all the power that went with that appointment. In retrospect, that was not the best decision for a family business, but we didn't fully understand the ramifications at the time. When my father had all of the power and made all of the decisions for the family, it seemed natural to us because he was the patriarch. But after he granted all of that power solely to Greg, it was just a matter of time before new issues and challenges would manifest themselves. We eventually hit an impasse in terms of our decision-making, how everything should be run, and who was in charge of what. My younger brother started doing some research to find an institution that could give us the guidance we needed to solve these issues. And his research led us to HBS's Families in Business program, which we attended as a group.
Gail Miller (GM): One of my sons had read about the program and encouraged me to look at the benefits it had to offer our family at a time when we definitely needed some professional education and direction. I decided not only to attend myself but to have all my children attend with me, because they work in the business and I needed them to approve the major changes I was about to make.
What goals did you have in mind when you entered the program?
SM: Our hope was to find some clarity on how to get ourselves unstuck from the impasse that we were experiencing in terms of decision-making rights, conflict resolution, and governance in general. We wanted to learn how to seamlessly transition from one generation to the next while preserving–and not breaking–what our family had worked so many years to build. There was a very real risk of the wheels coming off of a family enterprise that has more than ten thousand employees who rely on our business to put food on their tables. So we weren’t looking for theories and concepts. We needed real answers and practical solutions.
GM: I was hoping to learn how to create corporate governance that would allow our company to thrive for the next several generations. I also wanted to convince my family that there was a new and better way to do that. The program delivered everything I was looking for and a lot more.
Are there any valuable takeaways that you and your family were able to implement after completing the program?
SM: This learning experience was revolutionary for us. I think our family could be a case study for how to apply what this program has to offer. We have implemented a corporate board that includes external directors, as well as a family governance system that includes a family council (with multiple committees) and a family assembly. We've created a committee that has quantified the employment process–with defined processes for hiring, firing, and corrective action, as well as semiannual and annual reviews for every family member who's an employee. We've instituted a family activities committee, which reports to the family council, and we even have a family constitution that contains all our agreements about the use of family assets. We now have a great deal of structure, all of which was the result of our participation in this program.
GM: The benefits of creating a family office, a family assembly, a family council, and family governance have been invaluable. And for me, it was especially beneficial to see and hear other families talk about their businesses and to discover that we all had similar concerns. Our own issues were complicated, but as we worked with other families, we created solutions that have been helpful in a variety of ways. In the time since we completed the Families in Business program, we've found that the material has been foundational and we have used it to teach our next generation about how business works–not just our business, but business in general. We have relied on what we learned at HBS to help us set up all aspects of governance, both corporate and family. We have also reached out to other family-business owners in our area to collaborate in a variety of ways, including networking and introducing younger generations to each other, so they can use the tools we gained in the program and learn from each other.
What are your thoughts about the learning environment at HBS?
SM: It was very supportive. After a session or two, everybody seemed to realize that they weren’t alone in that space and that we were all experiencing the same thoughts and feelings. As a result, we developed a high degree of trust and respect for each other. A lot of the credit for that goes to the program structure, which allowed participants to connect at a deeper level during the breaks. The entire program was masterfully orchestrated.
What would you say to someone who's considering this program?
SM: Families in Business has helped in so many facets of our family enterprise. My only regret is that we didn't know about the program earlier and attend sooner. We could have saved ourselves so much wasted time and energy in all those years. In fact, we are planning to send members of our third generation to this program as soon as they're prepared, probably within the next two to five years.
GM: The value of this program cannot be overstated. Our family has benefited in ways that will shape our business for many generations to come. We learned many things that were not only relevant to our immediate needs but that we didn't realize were important until we saw them reinforced in case studies. The practical application of this material is invaluable to those who need help moving their business forward and who want to establish a pathway for future generations.
Is there anything else you’d like to add about your overall experience at HBS?
SM: I recently attended the Owner/President Management (OPM) program, which I enrolled in after I was asked to be the vice chairman of our family's business enterprise. I wasn't comfortable accepting that role without addressing some of my blind spots, but I also wasn't in a place in my life where I could go back to school full time. OPM turned out to be a great complement to Families in Business, as it helped me expand on the knowledge and skills that I needed to fulfill this new responsibility that my family had asked me to take on. In addition, our company has identified several executives in our organization as likely candidates for the Advanced Management Program (AMP) program. So, overall, HBS has opened a lot of doors for our business and has really shed a whole new light for us on the world of possibilities in terms of career, personal, and family development.