The Power Broker Roundtable is brought to you by the National Association of Realtors® and Jim Imhoff, NAR’s Liaison for Large Residential Firms Relations. Watch for this column each month, where we address broker issues, concerns and milestones.
Moderator: Jim Imhoff, Chairman & CEO, First Weber Group, Madison, Wisc., NAR Liaison for Large Residential Firms Relations
- Jason Waugh, President & CEO, Berkshire Hathaway HomeServices Northwest Real Estate, Portland, Ore.
- Linda Sherrer, President & CEO, Berkshire Hathaway HomeServices Florida Network Realty, Jacksonsville, Fla.
- Sheryl Chinowth, CEO & Co-Founder, Chinowth & Cohen REALTORS®, Tulsa, Okla.
- Greg Zadel, Broker/Owner, Zadel Realty, Firestone, Colo.
Jim Imhoff: On our worst days—and sometimes even on our best days—the most successful of us dream of sailing out to sea on a sleek little cruiser or spending our days on the green. But how many of us focus on how we’ll make that getaway, or have some sort of exit strategy in place? Does a succession plan require a formal document? A handshake? A discussion around the dinner table? It’s an issue worth exploring, and to do so, we’ve invited a sampling of company owners—franchisees and independents—to share their know-how and experience. Jason, you were already steeped in the business when your Dad decided to retire. What were the factors you needed to consider, and how was the transition made?
Jason Waugh: I think the main consideration for us was that my Dad and I shared the same vision. He had built a very successful company with a lot of public trust, and the goal was to stay true to his mission and principles no matter who was running the company. I had gone to law school and tried another path, but I’d had my real estate license since I was 19 and I’d worked for the firm in one way or another for most of my adult life. By the time I took over, we were clearly in alignment about the company’s culture and direction.
JI: Did you feel the need for formal documents?
JW: No, it was a pretty informal process, although we did call in an unbiased business coach—someone we had worked with before—to advise us on issues like the timing of the transition and the communications around it.
Linda Sherrer: Even when you have a child in the wings, so to speak, every situation is different. For instance withmy daughter, Christy, for a long time I thought there was no way she would take over the company because we are so very different in personality. But when she felt she was ready to leave another field and come into the firm 14 years ago, I was willing to give it a try—and I challenged her with a really tough assignment. She handled it quickly, efficiently and gracefully, and I had my first inkling that maybe we could make this work. Today, she is my executive vice president, with full responsibility for several aspects of the business while I control other aspects. And while we have no formal contract in place, one of the first things we did was distribute a formal organizational chart, with our responsibilities clearly defined, so that everyone within and outside of the company knows who they must answer to.
JI: Sheryl, you have sons in the business, don’t you?
Sheryl Chinowth: Yes, my husband, Lee Cohen, is my business partner, and our sons—one of whom left medical school to come into the real estate business—have been successfully managing various aspects of the company for several years. Like the Waughs, we met with a business advisor, and our wishes are spelled out in our personal trusts, but we have a lot of respect for what the boys have accomplished, and we know they are capable successors. In fact, for the past few years, they have become the face of the company in our advertising and such.
JI: And Gregg, you’re in a different position?
Greg Zadel: I am. As a small independent with no natural successor, I confess I don’t spend a lot of time thinking ahead. We have a handful of agents, and a family-like culture, and one possibility, if it came to that, is that the business might be divvied up, like a co-op, between the agents. Another, of course, is that the business would be acquired by another agency.
JI: Absolutely. My company has acquired many Wisconsin firms over the years because their owners were retiring. So how important is it, do you think, to have a written plan in place?
JW: Well, I’m still fairly young—a long way from retiring and too young to know whether my kids will grow up with any interest in the business. On the other hand, what if I stepped off the curb tomorrow and got hit by a bus? That’s the reason our franchise owners ask us to have a plan in place. We do some succession planning every year—planning for the unexpected—and that requires grooming of possible successors from within the company.
GZ: I’ll agree with that—watching your people as time progresses. Who has that indefinable “it” —a talent for managing and innovating?
JI: And what’s the key to increasing the odds your successor, and the company, will thrive going forward?
SC: Instinct counts. And, as Linda said, providing the challenge and watching how they step up to the plate.
LS: And a willingness to let go when the time is right…you must have respect for one another, and be willing to relinquish authority.