“See the road ahead,” Tim O’Keeffe advised the National Fastener Distributors Association in a presentation on the lifecycle of companies.

A company’s spot in a lifecycle is not based on age, sales, assets or employee headcount, and each stage has its advantages and problems, O’Keeffe said.

“We’ve got the space, we have equipment, we’ve got the cash, we’ve got the customers, we have the product,” says Tim O’Keeffe, owner of G.L. Huyett. “We have everything we need‚ except the people.”

Problems are normal and it is not a leader’s role to prevent problems, but to focus on the organization recognizing and resolving problem, the owner of Kansas fastener manufacturer G.L. Huyett advised the NFDA.

O’Keeffe quoted Dr. Ichak Adizes, author of Managing Corporate Lifecycles: “The same methods that produce success in one stage, can lead to failure in the next.”

Stages of the company lifecycle:

• Courtship: Focus on ideas and future possibilities and build on the founder’s enthusiasm.

• Infancy: Attention shifts to acquiring cash and sales. In the infancy stage there is little attention to paperwork, processes or control. “The founder tries to do everything.”

The founders can become “the enemy” by losing interest or developing materialism and arrogance.

A “family trap” can develop if unqualified family members join the company or unaware difference between shareholders and managers.

• Adolescence: A company is “reborn” in finding a way in post-founder years. The founder hires management an old employees become spectators. The focus changes from sales to process.

“The primary goal is to find a life apart from that provided by the founder,” O’Keeffe said.

There must be commitment to change and the owner needs to ask if he has the resources, stamina and a plan for the company.

Questions for the owner during the adolescence phase: Can you fire those socialize with? Are you honest with yourself?

This stage can bring high turnover and gravitation to factions, divorce and premature aging.

O’Keeffe, a business broker before acquiring fastener manufacturer G.L. Huyett in 1992, described the Kansas company as being in the adolescence.

The rural Kansas manufacturer was founded in 1899 by German immigrant Guy Lamson Huyett. Upon acquiring G.L. Huyett, Tim and Carol O’Keeffe added computers, a pick-and-pack system, published the first catalog, built a 25,000 sq ft building in a Kansas wheat field and introduced Huyett’s first employee benefits package. Since the beginning of the Millennium, G.L. Huyett built a 25,000 st ft addition to manufacture key stock, machine keys, pins and other products. In 2004, Hayes reached the 100-employee mark and in 2006 another facility was acquired to bring the total to 65,000 sq ft.

O’Keeffe said adolescence can be a good place for a company.

“Do not assume Prime is where you want or need to be,” he said.

Founders of companies in the adolescence stage need to ask themselves if they have the commitment, resources, stamina, power and authority to change, O’Keeffe said.

• The Prime phase includes a clear vision, planning and “everything coming together.” Customers are cared for and new businesses can be incubated or created.

• Stability: The aging starts. The prime goal becomes profit and cash flow and complacency sets in. “If it ain’t broke, don’t fix it.”

• Aristocracy: Cash rich, strong financial statement – but a greater bureaucracy. Company may seek acquisitions rather than organic growth.

• Early Bureaucracy: Numbers fall and recrimination begins.

• Bureaucracy: “Maintenance mode.” Usually results in death. Web: nfda-fastener.org