Accu-Label, an Indiana-based label converter that was established in 1987, has experienced significant success in its 35-plus year history. To ensure continued growth for the next generation, this thriving label converter has begun exploring succession planning.

As the company transitions from first to second generation leadership, the Manning family sought the services of SPL Consulting, LLC and Brian Van de Water, CEO. According to SPL Consulting, 70% of companies don’t survive the transition from first to second generation ownership. Using an analytical process reliant on data is an effective way of easing the transition.

“The primary cause for this troubling fact is the next generation – family or not – is not prepared for the leadership demanded by the responsibility of leading a business,” explains Van de Water. “Companies like Accu-Label that recognize the need for this and establish development plans for aspiring leaders have the opportunity to prepare themselves for what lies ahead. This process sets performance expectations for developing leaders to ensure they can become competent in areas they will need to master. It can be difficult, but in the event a team member is unsuccessful in getting to the next level, having documented performance data helps ensure companies get the right person in the right seat to maximize future success.”

David Manning, president, and Mary Jane Hendricks, manager, recognized the value in an effective transition. “We’ve come a long way with our organization,” states Manning. “We’ve had a very fragmented organizational structure, and we wanted to drive it the way it needs to be for future success. We’ve always worked hard, but we needed more organization and delegation to make the structure work. We’re really at a crucial point with that. We realized we needed to look at the analytical side and prioritize the whole of the company and not just individual segments.”

Many companies, whether exploring leadership transitions or not, are not always effective when dealing with change. That could mean a new label printing technology or a new CEO. One of the key factors of this transition period is preparing leadership and their team for what is to come.

“Succession Planning at its core is managing and preparing for change,” says Van de Water. “To accomplish this, the plan must have routine follow-up, review, and feedback on milestones agreed upon for development. Without a disciplined approach to revisiting and holding ourselves accountable to execute the plan, many reach the end of the year and realize too late that they didn’t make meaningful progress. Similar to strategic planning, it must be systematically reviewed with commitment to take time out of busy schedules to make it a priority. Without accountability and focus, when the time comes for them to assume more senior leadership responsibilities, they are not prepared for the challenges they will be presented with.”

“I feel like this process has been managed very well, keeping us on topic and focusing on the goals that allow us to move the family forward,” remarks Hendricks. “We’re setting the tone of where we need to be looking. It’s just the diligence of after the meeting, staying focused on the roles people have and addressing how that evolves. Working with a third party can sometimes be intimidating, where you’re opening up and showing everything going on in your organization. But working with Brian has been easy since we’ve always been headed in the right direction together.”

The Mannings have been willing to embrace change, which has made the process more successful. Accu-Label began with DISC assessment to identify personality types. “We undertook this initiative because of the need to survive,” says Manning. “We realize  70% of second-generation businesses don’t work after the first generation is gone, and I don’t want that to happen here. I want it to be third and fourth generation, if in fact the second generation wants that.”

SPL also encourages companies to invest in establishing development plans for future leaders. This focus creates a plan for eventual transition, as well as clarity for where team members may go and what they need to demonstrate to achieve their goals. This can be instrumental in reducing turnover and keeping valuable team members over the long term.

“We have hit some roadblocks along the way, and it’s really personalities, pride, and everything you have to deal with in this process – and you have to address it head on,” notes Manning. “It’s not as easy as it’s made out to be. You want everybody feeling that they’re just as important as the next sibling, and that’s the key here. I think we’re breaking some of those barriers down, but we’ve needed a lot of work in that area. SPL’s approach has us talking like we should in addressing succession.”

“The main thing is just being diligent and making sure we’re all working toward the same common goal, which is service,” adds Hendricks. “We all are production minded, but we’re not a corporation we’re a family business, and family comes first – and that’s not just blood family but all the members of our team. We want everybody to feel valued with what they bring to the team, and that’s what will bring us to the next level.”