Discussion – 


Discussion – 


Fire Your Dad?

I grew up in a home where my Dad was an entrepreneur. He owned, managed, built and developed mobile home parks. He worked hard, lots of hours and often from his home office. After graduating from high school, I attended the University of Southern California (Go Trojans!) so I could play on the water polo team and get a civil-structural engineering degree. As an engineering student, I figured I would learn how to design building projects and then go to work for my Dad as a project manager after graduation. But after the graduation ceremony, my Dad didn’t offer me a job! Now what? With no money and no means of support, I had to go out and get a real job, work for a real company and live on the money I earned!

In retrospect, this was the best career builder I could have experienced. I had to find a company to hire me, work within their system, do what they wanted me to do and get promoted based on my merits and contributions as an employee. Many of my college friends took the easy route and went to work at their Dad’s companies. Thirty-five years later they’re still working for the family business. They complain as they continue to wait for their Dad to retire or die so they can finally take over, make some real money, enjoy their lives, not live under the shadow of Dad’s success and have some freedom. Most of them are unhappy and unfulfilled as their dream to become a partner with their Dad hasn’t materialized yet. They postponed their lives and personal achievement waiting for unspoken promises their Dad never communicated nor offered.

60 and still waiting!

A sixty year old totally ran his Dad’s excavation contracting company for over twenty years. His Dad is eighty five years old, has medical problems and hasn’t been able to come into the office for the last five years. Twenty years ago the company was small and doing $250,000 in sales. Today, under the son’s leadership, it averages $4,000,000 in volume per year and makes a net profit of around $400,000 annually. But the son is fed up and tired of the situation. His Dad still owns 100% of the company and only pays his son $4,000 per month plus the use of a company pickup truck. The son works eighty hours per week, is not trusted to sign checks and can’t make any decisions or major purchases without Dad’s blessing. The son wants to quit, start his own company and fire his Dad. What would you advise him to do?

As the author of this column, I get lots of emails from young sons and daughters who work for Dad in the family construction business. They write because they are disappointed with their situation, unhappy how they’re treated and not respected by other employees since they’re the owner’s son or daughter. Some comments and complaints I get include:

– My Dad promised me ownership, but I can’t pin him down when it’ll happen.

– My Dad is stuck in the past and won’t try any new ideas.

– Our company isn’t on the cutting edge of technology.

– My Dad won’t let me make any decisions without his input.

– My Dad makes all the money and I do all the work.

– My Dad barely pays me enough to live on.

– I want this company to grow and my Dad won’t hire any new people.

– How can I get my Dad to listen to me and change his ways?

The consensus for these sons and daughters caught in a bad situation is a common desire to do more, want more and get more than they are currently getting. They see their Dad stuck in the past, not letting go, not trusting them to make major decisions or take over anytime soon. They are tired of working lots of hours, getting jobs nobody else wants, not participating in profit sharing and not seeing immediate or long term rewards for their efforts and contributions. They are frustrated reaching for the carrot that doesn’t ever seem to be available. They want more and don’t know what to do. But, they also don’t want to upset or confront their Dad, so they write and hope for a magic solution to the problem.

Sons must earn ownership!

Before sons or daughters are given ownership, they must answer these questions:

– How do you contribute to the bottom-line?

– Do you bring in new customers and business opportunities?

– Are you an expert in managing and leading a company?

– Do you understand financials and accounting procedures?

– Do you understand risk, banking, bonding and insurance?

– Do you understand legal contracts and commitments?

– What financial strength do you bring to the table?

– How much are you willing to pay for stock or ownership?

– Are you willing to lose everything if the company goes broke?

– Why do you have the right to tell your Dad what to do?

– Why should he have to listen to your ideas?

– Why do you deserve to be an owner in your Dad’s business?

– Why should Dad give you more than his key employees?

Commit or say good-bye!

Before sons or daughters should be considered for ownership of any company, they must earn their position of leadership and contribute to both the bottom and top line. If earned, the Dad must be then willing to sit down with his son or daughter and tell them the straight truth about his ownership transition plan. Often the Dad strings his kids along by never making a decision when or if the transition will take place, how the ownership will be earned or distributed and when the Dad will step back and retire. These unclear plans and unstated promises cause the son or daughter to get frustrated and unhappy. The Dad must take responsibility and write out his plans and review them with his son or daughter early in their careers. If this doesn’t happen, they will finally confront their Dad and can cause the family to split.

My recommendation for sons or daughters who don’t clearly understand Dad’s transition plan is to ask for one. If they don’t get satisfactory answers, amounts and dates, start looking for new jobs. I have heard too many stories of sons waiting for their Dads to give them the company only to find out it won’t happen for twenty or thirty more years.

My three sons!

Three brothers in their forties ran and managed their Dad’s plumbing company. The threes sons do everything including sales, customers service, operations and management. As Dad got up into his seventies, he still hadn’t offered profit sharing or ownership to the boys and pays them less than they could get with other companies. Dad uses the old line “hang in there and eventually you’ll get it all.” The Dad only comes in one or two times a week to approve major decisions the boys need to make. The Mom continues to come in on Thursdays to pay the bills and sign the checks. Dad also pays himself a six figure salary, has three company owned vehicles and takes lots of company expensed trips. This causes the company to struggle and be tight on cash-flow which doesn’t leave much for business growth.

The three sons know they’re in a bad deal but don’t want to upset the family. Eventually the youngest son quits and starts a competing plumbing company. He becomes very successful on his own and makes four times the money the remaining boys make working for their Dad. Now the problem worsens as the Dad promises the remaining two sons he will think about some new financial arrangement if they continue to run his company. So they keep working without additional compensation, stock or ownership. What should the boys do? Is it time to fire the Dad and quit working under a promise they might get some more money some day?

People don’t change!

People don’t change unless they want to change. You can’t change people unless they see the need to change. The Dad in these stories doesn’t have any reason to change, let go or give his boys profit sharing or ownership. Sons or daughters who want more, won’t get it until they confront their Dad, communicate exactly what they want and tell him the consequences if they don’t get it. For them to get Dad to change and offer ownership, more accountability and additional responsibility, they must lay out a positive plan for their increased role in the company. Then they can hope Dad agrees. If Dad won’t agree or doesn’t want to change, they must be willing and ready to quit working for the family business and get on with their lives.

Should I work for my Dad?

A high school senior wants to work for his Dad’s construction company some day. He can’t decide if he should go to college or start working right out of high school. He is leaning towards starting work without college. His Dad says he could use him out on the jobsite now. Plus, he argues, a college degree is expensive and won’t really matter if he works in the family business.

Why would a young high school son or daughter want to start working immediately for their Dad after graduation? To me, going to work for Dad is the easy way to go instead of doing what’s best for his son or daughter. By going to work for his Dad, the son won’t have to take any employment risks, won’t have to experience the challenges of college or worry about finding a job in the future. And the son thinks he might get to run his Dad’s company some day. But does the son have any assurance the company will fulfill his dreams and promises? Will the company still be around when his Dad finally turns it over to him fifty years later? Will not having a college degree hurt him in the future? What if the son doesn’t like construction and wants to change his career path?

Why Do Dad’s hire their children too early?

– They are easy to hire.

– It eliminates interviews and looking for qualified employees.

– Untrained sons will do things Dad’s way without questions.

– Employees make demands, must be respected and treated fairly.

– Sons can be asked to work lots of hours without compensation.

– Sons don’t have the right to complain or make demands on parents.

– Sons can be asked to do anything for the good of the business

– Sons can be trusted even if they’re not qualified.

– Sons can be paid less than they’re worth.

– Sons will keep working without ownership or profit sharing forever.

– Sons won’t ask for too much money as long as Dad acts poor.

What should my boy do?

My advice to sons and daughters of construction company owners is to go to college and get a degree in what they feel is best for their future. If construction is their career path, get a degree in construction management or civil engineering. After graduation, go to work for a major construction company that has an intern training program for college engineering graduates. Learn as much as you can from the professional company, their managers and systems. Work hard and get promoted to Project Manager, Superintendent or Estimator. Practice and perfect your newly acquired skills and grow into a valuable management team player and contribute to the bottom-line in a major way.

When you become a success on your own, you’re ready to apply for a leadership position at your Dad’s company. But only accept an offer under your terms with a written agreement about your responsibility, stock ownership and profit sharing will occur in the future. Be ready to work harder than anyone else in the company. Expect no special favors and earn your pay like a professional. Get promoted to stockholder and help the company grow to the next level as your Dad backs off and let’s go.

When a son or daughter works for their Dad’s company, they should always ask themselves if they could do better, make more money, have more fun or get ahead faster at another company. They should never postpone their future waiting for Dads to potentially give them a piece of the company someday. Fathers and sons should discuss, agree on and put the following into writing:

– Stock ownership transition plan

– Buyout options

– Compensation packages

– Management accountability transition

– Chain of command & authority

– Joint review of financials monthly

– Participation in major decisions

Sons and daughters, if your Dad isn’t willing to be open and honest with you about the future of his company, ownership, transition and compensation; you have no choice but to fire him by quitting. Aren’t family businesses fun?


George Hedley owns Hedley Construction and Hardhat Presentations. He is the author of the “The Business Success Blueprint Series” now available in 8-workbook & audio CD sets. He is available to speak at your organization on his proven system to build profits, people, customers and wealth. Construction company owners are invited to attend his 2-day ‘Profit-Builder Circle’ boot camps held regularly. E-mail him to receive a free copy of his book entitled “Everything Contractors Know About Making A Profit”, signup for his free management e-newsletter, visit his online bookstore, or receive more information. Call 800-851-8553, visit his website at www.hardhatpresentations.com or e-mail George at gh@hardhatpresentations.com.

George Hedley HARDHAT Presentations

3300 Irvine Avenue #135
Newport Beach, CA 92660
Phone (949) 852-2005 Fax (949) 852-3002

Email: gh@hardhatpresentations.com website: www.hardhatpresentations.com

George Hedley owns a $75 million construction and development company and Hardhat Presentations. He speaks to companies on building profitable businesses, leadership, and loyal customers. He holds 3-day in-depth “Profit-Builder Circles” open to construction company owners in an interactive roundtable format every 3 months. His “Profit-Builder System” includes proven tools to always make a profit, build equity, create wealth, win profitable jobs, motivate your people, and enjoy the benefits of owning a profitable company.


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