Saturday, June 9, 2007

It isn't Luck!

Many people think that starting a business, and having it succeed is just luck. It may be because the perception that it is. The real truth is that setting up a business, and making it succeed puts you in a state of mind that will make you grasp opportunities as they come along. This is quite true of a large construction company in my state that was on the brink of catastrophe when nature provided the area with a disastrous flood in August 1955. The three brothers who owned this company were in a position to capitalize on the disaster. Although the were on the brink of going out of business the disaster provided their company with a plethora of new business that they were able to take advantage of. Today, 52 years later this small construction company is one of the leading construction companies in the US. The three original brothers who were there in 1955 are still alive, and have turned the operation of the company over to their son’s and grandson’s.

There is no doubt that they had some really good luck in being able to take advantage of the disaster when it came their way. The real truth though is they were in such a mindset that when disaster came calling they were able to use it to their advantage.

Although the company was founded by their father in the early 1920’s it remained dormant for many years until the three brothers got out of the service at the end of WW II. They reformed the company after the war and for many years it staggered along. This was a period when they were forced to borrow machinery a,d equipment from other contractors to keep their heads above water.

I can remember one episode very vividly because it involved my own family. My father was going to swing some iron in conjunction with a factory building he was building a year before the 1955 flood, and the founders came to him to see if they could get the job. My father gave them the job. When they showed up on the jobsite I didn’t see their name on the crane they would have too use. Instead there was the name of some other construction company painted on the crane.

Sometime after the flood the three brothers got to fighting among themselves. They got into such a row that they wound up firing each other. Then they thought about what they just did, and realized that no one was running the company. With that they cast about for a consigliore, and came up with one of the two brightest people I have ever known. They tasked this man with operating the company which he has done ever since. It wasn’t luck that they came up with their consigliore it was more mindset between the three brothers.

This mindset was also sufficient for them to hand off the day-by-day operations of the company, and changed the roll of the brothers from forming policy to that of forming long range strategy. It has been an extremely successful company. For a company that probably has over a billion dollars in revenue per year it is still privately held.

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