The 113-year-old family business has not gone the way of Milwaukee's Schlitz Brewing Co., collapsing after the family owners lost control. Not one has been inquiring about the rise and fall of the storied Johnson empire.
Instead, in a tiny, elegant sitting room at the headquarters here of the old Johnson Wax empire, three of the four Johnson children are seated knee to knee on a white sofa, listening to their father, Samuel Curtis Johnson, explain to a visitor his unusual plan to sustain one of the nation's largest family-owned businesses by splitting it asunder.
That plan -- to carve the $5 billion enterprise into three unequal parts, giving each interested child a separate company to run -- was more than 30 years in the making, Johnson said, and born out of earlier brushes with family disaster. Framing it has entailed patient planning and study, an eye toward history and careful stroking as the children were positioned for the future, each like a delicate chess piece.
"I read every article in a major publication about family enterprises," said Johnson, 71, and usually called Sam, as he described a succession plan that will fall into place in the next few months. "We think about what are the things that destroy family enterprises."
Like his siblings, Sam Johnson's first child -- also named Samuel Curtis Johnson, but called Curt -- heard horror stories about the collapse of other family enterprises as he was growing up. Rather than demand a birthright to ascend to his father's role, Curt Johnson, now 44, has agreed to run a unit of the business that sells to industrial customers. His sister Helen Johnson-Leipold, 42, was named chief executive of the family's recreational products business in March.
And later this year, the giant consumer product unit -- with a stable of familiar brands including Drano, Windex and Raid -- will be entrusted to their brother, Herbert Fisk Johnson, 41, who is named for his grandfather and great-grandfather and is called Fisk. (Winnie Johnson-Marquart, 40, their little sister, hasn't wanted to run a business. She has four children, lives in Virginia and works part-time for S.C. Johnson in public affairs.)
"Sure this is unusual," Sam Johnson said emphatically, speaking later in his office. But he is resolute that giving his children autonomy is the recipe for a successful transfer of power. "One thing I know about brothers working for brothers," he explained, "is that it always has the potential for disruptions."
If families like the Schlitzes, or the Binghams of Kentucky, whose media company dissolved as father battled son and brother battled sister, afford case studies in what can go wrong in the passing of the generational baton, the Johnsons would like to believe that their story will be a case study in what can go right.
Transitions, however, weren't always smooth. When Herbert Fisk Johnson, Sr. died unexpectedly in 1928, he left no will. A struggle ensued for control of the Johnson empire, pitting brother against sister. Eventually, a 60-40 split gave control to Herbert Fisk Johnson, Jr.
"It took my father 10 years before he was able to settle my grandfather's estate," Sam Johnson recalled. "Fortunately, it didn't wreck the family. My father said, 'I'm never going to let that happen to my son.'" In his will, he clearly designated Sam as his successor.
Sam Johnson wasn't going to let it happen again, either. After his father had a stroke in 1968, Johnson, by then the company's president and chairman, took a year off to reflect. When he returned, he outlined a plan to begin "downstreaming" his assets, setting up trusts for his children and grandchildren.
He diversified the company in the 1970s, buying makers of outdoor recreation equipment to form what has become Johnson Worldwide Associates, the publicly traded company that Helen Johnson-Leipold now heads, and starting the Johnson Bank, which is now one of the largest banks in Wisconsin.
These steps, he acknowledges now, were made as much out of fear as logic. "I thought the wax company might get smothered by Proctor & Gamble," said Johnson, whose wealth is now estimated at $3.6 billion by Forbes magazine. "I also thought these companies might make a good farm team for the children."
A family council was formed. Sam Johnson, his wife, Imogene, and all four children met regularly to discuss the business and the family. There were also family advisors with expertise in estates and other matters.
The Johnsons say there was little jealousy or competition, little currying of their father's favor. Yes, they "fought like cats and dogs" as youngsters, Johnson-Leipold said, but as adults, they just fell into place, largely because of their father's attention to the details. "We each found our spot," she said. "Curt was the wheeler-dealer entrepreneur, Fisk was the technician and I was the one interested in marketing."
Indeed, the Johnsons -- for all the dysfunction one can imagine their circumstances spawning -- seem a remarkably congenial bunch. They bank at Johnson Bank and eat at Johnson-owned restaurants. They love the outdoors; they love shared adventures.
Lessons from the Johnson Family of
S.C. Johnson & Co., the Fifth Generation
1.S.C. Johnson shares his dream with his children to sustain one of the nation's largest family-owned businesses.
2.The Johnson family has learned to communicate well with each other. They have differences of opinion, but never allowed to boil over into disruptive conflict.
3.A family council is formed to talk about business and the family.
4.The Johnsons come together after working hours. Examples: eating out, outdoor activities, shared adventures and vacations.
5.A dispute resolution plan is set in place when the three heirs have irresolvable problems.
6.Family seeks knowledge about succession planning.
7.They call on advisors to help guide them through the major challenges.
8.S.C.'s first born, Curt, agrees to run (collaboration) a unit of the total company rather than the entire operation.
9.Curt, 44; Helen, 42; and Herbert, 41, will each have their own autonomy. The transfer of power precludes one reporting to the other.
10.Each Johnson heir makes a major contribution to the business while executing their own personal training program.
11.Estate planning used as a safety net in event of accidents or health problems, becomes a priority for family members.
12.Sam Johnson prepares himself to let the three heirs do their jobs without his interference, but with council. Sam's outside activities: Johnson International, employee financial services and a banquet facility.
This article appeared in Mike Henning's Family Firm Advisor newsletter, for more information about receiving one free copy of our newsletter, visit us at our web site: www.mikehenning.com, e-mail: hfbc@mikehenning.com. or call -- 217-342-3728. Mike Henning is a nationally and internationally respected consultant and speaker on family business issues.
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