Any of his sons could handle the job—provided he had the support of the other two. This fact inspired what may have been Jack’s fourth lucky mistake. Although many experts maintain that successful changeover from one generation to the next requires the founder to appoint his or her successor (see “Wine Estate Planning”), Jack determined that his children should decide among themselves. He discussed the idea with Dolores, then sat his sons down and explained what he wanted them to do. Over the course of several meetings, under the guidance of consultant Dr. Craig Aronoff, cofounder and principal of the Family Business Consulting Group in Atlanta, the three men ultimately chose Bruce—the youngest and the son with the least business experience—to step into their father’s shoes as president and chief operating officer. In the following conversation, all four Cakebreads consider their unusual approach to resolving the succession question.

Timing is Everything
Jack: The passing of the baton is a very delicate operation, because some families are dysfunctional, and others seem to make no effort whatsoever. In our case, I have an outside board (they don’t own anything, but they are retired CEOs), and their comment to me was: “Jack, it’s time for succession planning, or do you want to have the boys do it in the sedan coming home from the cemetery?"

Bruce: The idea was to do our succession planning when everybody was healthy, the business is strong, and we can all deal with the issues. When you wait for someone to die, you don’t have control over the timing. It makes sense to do it early. But it does take forward-thinking people throughout the whole family to realize that this is best for the business—and to decide whether this is a business-business or a business run for the family.

All three could handle the job, but if I picked one, I was going to alienate two.

Steve: From the founders’ side of this, my mother and dad get a lot of credit for being open enough to let those discussions go on before a management change was even contemplated. This is hard to do when you’ve put so much passion into building a company. But the beliefs that, fundamentally, the family is successful when the business is successful and the business is successful if the family is successful really go hand-in-hand.

The Family Pact
Jack: I thought, “Let’s decide now.” But I agonized over this. All three of them could handle the job, but if I picked one, I was going to alienate two, and it’s never been pulled off in this valley that a family business has transitioned from one generation to the other without losing a family member somewhere along the line. So I came up with this brilliant idea that it’s not my problem—it’s their problem. I got all three of them in the office, and I said, “OK, here’s my plan.” We got them some professional help—we didn’t just throw them off the deep end of the pool—and it took them about a year and a half to figure out which one of them the other two would support and trust.

Steve: It was fairly insightful of my parents, the board and my two other brothers to perceive that, if the three of us didn’t agree on who the successor was, that individual would have one hell of a time leading the company. Once we got to that conclusion, it was really down to the three of us hashing out who was the best person to take the company forward.