All in the family

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The partners, from left, Daniel Denihan, Brooke Barrett, Lawrence Denihan, John Ferrari, Patrick Denihan and Donald Denihan. Ah, the joys of office politics. Who's really got the power? Who gets paid too much for what he actually does? Such questions cut twice as deep when you're related to your office mates. Many travel companies (including agencies) are family-owned, grappling with such issues as who will succeed the parent as head of the firm.

Some of these family-run companies are turning to outside sources for help. For example, the six related partners who own Manhattan East Suite Hotels meet regularly with family business consultant John Messervey of the National Family Business Council, Lake Forest, Ill. "It's always helpful to have an objective person who listens to people's comments without any hidden agendas," said Brooke Barrett, the only woman partner.

The family turned to Messervey after the company's founding patriarch, Benjamin Denihan, died. Though Denihan "did a lot of estate planning, he didn't leave anybody in charge," said Barrett.

Messervey helped the six develop a partnership agreement in which everyone basically had an equal share, though Barrett's brother, Patrick Denihan, is the managing partner. Now Messervey acts as "a regular sounding board to help us work and communicate better with each other," said Barrett.

For example, when the partners started thinking about strategic planning, Messervey helped them realize that "if we wanted to grow the company, we needed to have one of us focus strictly on development," said Barrett's cousin, Daniel Denihan.

"We realized that if we hadn't done that, the Benjamin [the company's latest property, which made its debut this April] would've passed us by."

The Benjamin, of course, was named for Barrett's father. For Messervey, the fact that the Denihans wanted to honor the company's founder was a sign of the family's basic strength. Unlike the more dysfunctional families he works with, the Denihans are "gentle and effective with each other," he said.

"As much as it's work to get along with my brothers and cousins, I love them all, and they're great to work with," said Barrett.

Avoiding family feuds

The partners with New York Mayor Rudolph Guiliani, second from the right, and their mother, Irene Denihan. "It's important to keep the lines of communication open" when you work in a family business, said Brooke Barrett, a partner in the family-owned Manhattan East Suite Hotels. To keep those lines open, the company has regular sessions with a family-business consultant.

For families interested in working smarter together, Barrett suggested the following:

  • Set up periodic meetings with a specific agenda.
  • Develop very specific guidelines for how your business is going to operate.
  • When you're dealing with a conflict between family members, "speak in 'I' statements, such as 'I feel hurt and angry when you do that,' which doesn't sound as confrontational as 'You did that and I'm mad at you.' "
  • Be grateful for the advantage of family businesses. "So many things are so much easier and more rewarding," said Barrett. "You make quicker decisions knowing that the buck stops with you and money doesn't go into shareholders' pockets."
  • Develop guidelines for bringing the next generation into the fold. Barrett's 28-year-old son and 27-year-old daughter are not in the business now. "I've said, 'Go do other things and think about it. If you're interested later, come to me,' " said Barrett.
  • With this strategy -- totally different from what Barrett's father did with her, which was to expect every child to join the business as a matter of course -- those who do come into the business do it by choice and can also enrich the business with skills they've picked up in the "outside world."

    Ways to work with your mother-in-law

    Here are more resources for family-owned agencies:

  • The Family Business Council of Greater New York. This is a Manhattan-based, nonprofit group set up to provide support to family-owned businesses. Members attend workshops on such topics as estate planning and tax saving; receive a bimonthly newsletter, and participate in small forums that meet regularly. The annual membership fee is $195 for individuals and $375 for companies. Call (212) 684-7144 or check out the group's Web site, www.fambizny.org.
  • Family Business magazine. This 80-page quarterly includes articles on such topics as succession planning and the problems women face in family-run firms. Subscriptions are $95; write to Family Business Publishing Co., Box 41966, Philadelphia, Pa. 19101-1966 or subscribe on line at www.familybuspub.com.
  • Check out the following books:
  • "Getting Along in Family Business: The Relationship Intelligence Handbook" by Edwin A. Hoover and Colette Lombard Hoover. Two psychologists' advice on achieving "relationship intelligence" by understanding the emotional dynamics of family-owned companies; $29.95, Routledge.

    "The Successful Family Business" by Scott Friedman. A lawyer and business consultant's take on the topic; $22.95, Upstart Publishing Co.

    "The Family Business: Power Tools for Survival, Success and Succession" by Russell and Roger Allred. Tips from two brothers who own a consulting business; $12, Berkley Publishing Group.

    Calling all family businesses

    How hard is it to be related to the people you work with? While we told one story above about a family-run travel business, we're looking for more case histories on the agency side.

    If you think you and your family are a good example of a business that runs well, let us know. We're especially interested in hearing from families who have successfully dealt with real-life conflicts. We're not looking to air dirty laundry, but the more specifics you can provide on problems you've overcome, the better.

    We're also looking for more stories about good-looking agencies. If you think your agency is a candidate for "Architectural Digest," or you have a story about how you've solved an interior-design problem, contact Agent Life editor Phyllis Fine at [email protected] or fax her at (201) 319-1947.

    Hit banks -- that's where the money is

    Richard Turen.Banks, savings and loans, and credit unions represent a major source of potential new business for leisure agencies. Think of it: Here they are, sitting on a customer base that can easily be broken down into segments based on the amount of money under deposit.

    The banks are in a competitive business. A shift of a half a percentage point in an interest rate can cost them a valued customer. So you come along and propose a program that aids client retention, brings in new customers and costs the financial institution nothing.

    First, set up a meeting with the director of marketing. Do it over lunch so you have time to properly make your pitch. Explain that the bank is sitting on a true affinity group and that you can provide a series of value-added benefits at absolutely no cost.

    Help it set up a travel club and it will produce an ongoing, renewable stream of upscale vacation business. The bank already sends monthly statements to its customers. Why not include cruise gift certificates, tour discounts, complimentary upgrades or limousine service to the airport? Why not set up a special bank hot line in your office so all travel program calls come directly to you? Why not pay the bank a percentage of sales or reward its marketing support with complimentary cruises or tours that can be distributed to their top employees as an end-of-year incentive award? The possibilities are endless.

    A good salesperson will never drive past a financial institution without thinking about the myriad of approaches one could use to secure its business.

    Richard Turen is managing director of the Churchill Group, a sales and marketing consulting firm, as well as president of the agency Churchill & Turen Ltd., both based in Naperville, Ill. Contact him at [email protected].

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