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Entrepreneurship – Who Should You Partner with or Hire? -
Part III
By Karl. A. Parker, P.E., MBA Board Chairman, Parker Family
of Businesses
The Truth Contributor
In the previous articles,
Part I and Part II, I discussed how my father, Edward Parker
Sr., operated in the informal underground economy with the
many businesses that he owned and operated, and how my
oldest brother, Edward Parker, Jr. launched his first
business with the similar philosophy- Parker & Carter Home
Improvement. Parker & Carter Home Improvement failed when
internal family strife emerged and basically destroyed the
business.
Consolidated Electrical
Contractors and Engineers (CECE), a collection of family and
friends, specifically my uncles Chuck and Willie, my sister
Sandra, my brother Edward and my brother-in-law Louis, was
then founded. The company was located on Elm St in North
Toledo.
The company was focused on
residential and small commercial electrical construction.
This is when I launched my official electrical career as an
apprentice electrician in 1978. (I actually have a copy of
the card.)
The company grew rapidly,
won contracts to install electrical systems for churches,
stores and large residential complexes. This growth was
fueled with family and friends. However, my brother’s
appetite for growth and the company’s success required
additional personnel.
So CECE launched a
Department of Labor-approved electrical apprenticeship
program to train electricians primarily from the central
city to join our company. Several of these individuals were
close friends or family.
However, even with the
apprenticeship program, our human capital strategy could not
keep up with the growth. Additionally, a lurking figure
would emerge from the shadows who would eventually doom CECE.
Recall when I discuss in
Part I, a family business requires trust and loyalty. My
family was adamant that you surround yourself with family
and friends, people you can trust. This was because when
times are difficult or issues emerge, most family and
friends focus on the success of the enterprise and circle
the wagons.
CECE was fortunate enough
to win two major contracts around the same time. One, the
remodeling of Ravine Park Village, an LMHA housing complex
located on the East side of Toledo, and a water treatment
facility in Delphos, Ohio.
Additionally, CECE had won
contracts with Central Lagrange Library, Ohio Bell
Substation and the Coast Guard. These were large projects
that required additional electrical construction personnel.
CECE’s human capital strategy just could not keep up.
The growth and success
also attracted the attention of the local contracting
community and the International Brotherhood of Electrical
Wworkers (this is the lurking figure I was referring to).
Members of IBEW began to picket and protest at Ravine Park
Village. They also threatened similar activity at the water
plant in Delphos, Ohio. The leaders of CECE resisted as
long as they could.
Eventually, the pressure
and the political strife associated with this (because the
local IBEW dominates the political scene), compelled the
CECE leadership team to cave in and become signatory to the
union in 1980. This was game-changing for the business. It
violated the fundamental principles set forth by my father,
which means trying to keep family and friends in charge of
crucial components of the business.
As contractors who are
signatory to the union, you no longer control your
workforce. For example, when you need an employee, you are
sent whomever was at the top of this long list of
electricians who were members of the union.
Back then, unfortunately,
CECE would continually receive commercial and industrial
electricians who did not know anything about installing
residential systems, which included ROMEX and Wire Mold, or
perform simple electrical circuit tie-ins. As a result, the
labor cost and even material costs of the Ravine project
spiraled out of control, which threatened the viability of
CECE.
Additionally, CECE
received employees for the Delphos water plant who lacked
the commitment to the business. As a matter of fact, the
eventual “foreman” for the Delphos project whom CECE
received from the union led to the downfall of CECE. (One of
the CECE leaders had to assume leadership of the Coast Guard
project therefore they had to ‘trust’ the union-provided
foreman.)
This decision to step
outside of the family and friends human capital strategy was
the impetus for internal leadership strife and eventually
caused the demise of CECE.
Ed. Note: To be continued in Part IV - Entrepreneurship –
Who should you partner with or hire? Parts 1 and 2 of this
series can be found online –
www.thetruthtoledo.com – in issues May 20 and
June 17, respectively.
Entrepreneurship –
Who Should You Partner With or Hire? - Part II |
