The Canadian Association of Family Enterprise GTA held its annual Family Business of the Year awards dinner on Thursday. What an inspiring evening of success stories from families who have overcome not only the usual host of market and competitive challenges, but real adversity and often personal tragedy to achieve prosperity and longevity for their companies. It was just the inspiration we all needed on a cold grey night at the end of winter at the end of a recession.
There were three presentations from award nominees (more about this in a future blog) and keynote address from Derek Oland, Executive Chairman and fifth generation owner of Moosehead Breweries Limited.
Now I have to confess to not being much of a beer drinker (other than the occasional Creemore Springs, the ‘town beer’ close to our weekend place south of Creemore) so I was largely ignorant about the Moosehead brand – and certainly its business story. But what a fascinating story it is!
Based in Saint John, New Brunswick, Moosehead is the largest privately owned independent brewer in the country. Its product is distributed in all Canadian provinces and U.S. states, and it also provides contract brewing for three global brewing giants.
The company’s history reads like a Hollywood film script: Its roots date back to the early 1860s in Halifax when the business was started, remarkably, by a woman, Susannah Oland. Her recipe for ‘Brown October Ale’ was a local hit and led her to open of the Army & Navy Brewery with a business partner. When her partner died just three years later, she took over the business, with help from her sons, bought controlling interest and renamed the business S. Oland Sons & Company.
In 1878, the brewery and family home were destroyed by fire. A brick brewery built in its place was destroyed by the 1917 explosion in Halifax harbour and one family member was killed, another injured. At one point, the family lost control of the business due to financial troubles – only to regain it in a future generation. One branch of the family went into direct competition. And, like most family businesses, Moosehead faced repeated struggles with inter-generational succession that threatened to derail the company.
It was on the subject of succession planning that Derek spoke particularly passionately and with authority. He’s clearly given the subject a lot of thought, having himself experienced a difficult transition from his father’s ownership and management of the company to his own. Derek bought out his sibling shareholders in 2007 and is preparing the business for its sixth generation of family ownership, with two of his four children now working at Moosehead.
With his permission, I am passing along Derek’s philosophy of succession planning which is very well thought out:
• Family members must have solid education
• They must work outside Moosehead beforehand
• They must express a desire to work at Moosehead
• A position will be found, if available
• They must be capable and hard working and willing to learn the business
• They must be willing to work with professionals in the company
• They must be willing to compete with professional managers for promotions
• Professional managers must believe they have an opportunity to lead the company – there is no such thing as ‘automatic’ ascension
On the last point, Derek was particularly adamant. Moosehead’s success depends on attracting top talent and that can only be achieved if non-family managers can see opportunities for progression.
Given 75% of family businesses do not survive to the third generation, learning from the lessons of one that’s prospered through six generations may be instructive for us all.
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