by David Smale
Allen Bank & Trust Co.
Andrew County Mutual Ins Co
Argentine Federal Savings
Armstrong Teasdale, LLP
Bank of Belton
Bank of Grain Valley
Bank of Lee’s Summit
Bank of Odessa
Buckley Insurance Agency
Burnham, Colman, Kaelin & Walker
Burns & McDonnell
Cameron Insurance Co.
Capitol Federal Savings & Loan
Charlton Manley Inc.
Citizens Savings & Loan Association
Clay County Title Corporation
Columbian Bank & Trust Co.
Columbus Corporation/Bank of Stanley
Commerce Bancshares, Inc.
Cullum & Brown, Inc.
DeSoto State Bank
Exchange National Bank & Trust
First Community Bank
First Kansas Bank & Trust Co.
First National Bank of Leavenworth
First National Bank of Medicine Lodge
First National Bank of Olathe
First State Bank of Kansas City, Kansas
Gold Banc Corporation
Gordon & Gordon, P.C.
Harvey A. Jones Engineering Co., Inc.
Inter-State Federal Savings
Intrust Bank, N.A.
Kansas City Life Insurance Co.
Lathrop & Gage L.C.
Layne Christensen Co
Legacy Financial Group Inc
Lind Merrill Inc
McAnany, Van Cleave & Phillips, P.A.
Missouri Bank & Trust Co.
Nodaway Valley Bank
Oppenheimer & Co.
Rothenberg & Schloss Inc.
Security Benefit Corp.
Shafer Kline & Warren
Shook, Hardy & Bacon LLP
Stinson Morrison Hecker LLP
Swanson Midgley, LLC
Trustco Bancshares Inc.
U.S. Engineering Co.
Wells Fargo Financial
Wrenn Insurance Inc.
There’s something special about driving a classic automobile. The time-honored craftsmanship makes that vehicle much more than a collection of nuts and bolts and sheet metal. Driving it, while it may not provide the same rush as one of today’s fuel-injected, turbo-charged sports cars, gives the operator a sense of accomplishment.
In the same way, there is something gratifying about running a company with a tradition and history that dates back more than 100 years.
Ingram’s surveyed several of the top executives of area companies in the professional services industry that are at least 100 years old to see if they feel any extra pressure in “driving the classic company.”
Greg Graves is the President/CEO of Burns & McDonnell, a 107-year-old engineering firm founded by Clinton Burns and Robert E. McDonnell. After Burns’death in 1924, the McDonnell family (Robert E. and then his son, Robert H.) controlled the partnership until 1971. It was sold to Armco, a large steel company, which sold it back to Burns & McDonnell employees in 1985. Through more than a century of operation, Burns & McDonnell, number three on this month’s list of largest area engineering firms, has had only six CEOs.
Is it more difficult to carry on a tradition of this vintage?
“I do not feel any extra pressure because we’re 100 years old,” Graves said. “I feel a lot of pressure because we’re an important provider in the city, the county and the region.” Graves feels the greatest pressure from the fact that the company is employee-owned. As Graves sees it, there is more than their livelihood at stake. It’s their life savings. “People are counting on you and you don’t want to let them down.”
For most 100-year-old companies, managing the present and planning for the future far outweighs reflecting on the past. This is true for Burns & McDonnell as well.
“Because you’ve been around a long time, there’s a lot of built-in culture,” Graves said. “We think a lot of that is very good, but it isn’t always modern.” The biggest challenge for a company of this age is to maintain the part of the culture that’s good, while not letting the firm get complacent or fall behind technically.
“We’re in the business of science,” Graves said. “It’s important for us to be on the edge of technical excellence.” Staying on that edge requires Burns & McDonnell to run faster today than it did yesterday and then to run even faster tomorrow. Yet we want to maintain the part of our culture that has allowed us to survive through 100 years, including through things like the Depression.”
Diversification of services, where appropriate, is a good way to expand and make sure the business survives and grows. Another method is to expand the company’s territory. Argentine Federal Savings of Kansas City, Kansas, recently expanded into Overland Park to try and grow its customer base.
“For any business, maintaining business and getting new customers is the key,” said Mark Rielley, Argentine’s President.
But the decision on where, when and how to expand is a delicate one. Graves said his company has the advantage of plenty of past experience to guide it in the decision-making process.
“When you’re old, you don’t make decisions for this year’s revenue and budget, because you’re blessed by people in the past who didn’t do that,” he said. “We’re going through some development that will not benefit our employees financially for several years. I guess that’s how you get to be a 100-year old company.”
The challenge for companies with long histories, regardless of size, is staying current without leaving behind the people who helped you reach the present. John Gordon of Gordon & Gordon, P.C., has clients who have been with the firm for decades.
He says there is an expectation that clients have, especially those who have been with the firm for a number of years, not only for good service but prompt service. “The challenge is to still be moving forward while working with the older customers,” he said. “An older clientele doesn’t want e-mail. It is not an acceptable medium for communication.
Gordon also says that the firms older clients also have to get used to a more collaborative approach between lawyer and client. “In the old-days, it was paternalistic—a male-dominated business—and it tended to be more of an authoritarian situation,” he said. “The client would ask the question and be expected to accept the answer. There’s more of an exchange and a team effort. A client and an attorney brainstorm how to solve the issue.”
Regardless of the industry, looking back is not a luxury top-level executives have much time to do.
“By focusing on the future, there is little time to worry about the past,” said Darwin Copeman, President/CEO of Cameron Mutual Insurance, established in 1892 as Farmers’ Mutual Tornado, Cyclone and Windstorm Association of the Third Congressional District of Missouri. “The pressure is about exceeding last year’s objectives and creating value for our policyholders.”
There certainly are advantages to having a long history. Chris Jones, President of Harvey Jones Engineering Company, notes that the company’s reputation is its strength. She is married to the son of Harvey Jones, whose grandfather founded the company in 1852.
“We have so many ‘old-timers’ who come into the office and expect us to know exactly which survey they’re talking about, because Harvey did it,” she said. “It’s fun to work with them, because they expect things to be done with credibility and with a handshake.
“On the other side, young people expect everything to be on the computer. Obviously, our old files are not on the computer. The young people are amazed when they see the depth of our records. It’s a delicate balance.”
Jones feels some pressure to keep the firm in operation because of the depth of records. She says there aren’t many engineering firms in the state, or even in the country that have been around for more than 150 years.
“We have records that go back forever,” she said. “If this business closed, what would happen to those records? It puts a little more pressure on me.”
One key to longevity is differentiating between a fad and a trend. While executives want to stay away from fads that can lead to far more negative outcomes than positive ones, if a company waits too long to adjust to industry trends, the competition will leave them behind.
Lathrop & Gage Managing Partner Tom Stewart says the key is to not overreact.
“It helps to stay rooted in what satisfies our lawyers-achievement, challenging work, recognition,” he said. “We are always on the alert to steer steadily without overreacting to trends, but we pay attention so we are, more often than not, positioned for the ones that have a long life for us and our clients.”
So what is the best way to decide?
“The only way to tell a fad from a trend is to wait around,” Graves said.
The best way to avoid jumping in on the latest fad is to keep a good mix of senior leadership, according to Darold Shelton, President of Allen Bank & Trust of Harrisonville.
“Our senior lenders and officers have seen the historical issues and difficulties and have assisted us in staying true to our standards and practices,” he said.
To that extent, you must be able to keep your key employees, as with any business. “I think if you listen to people and try to ensure you are providing a good place to work, where people are treated fairly, you will be on your way to managing effectively,” said Frederick Greenbaum, President of McAnany, Van Cleave & Phillips, P.A.
“The biggest challenge is providing an environment where everyone works hard together for the best results for the client. You need to recognize everyone’s strengths and use those to benefit your clients and your business.”
Even the personnel side of operating a professional services business has changed, and adaptation is a key. “The old Lathrop & Gage considered itself 90 percent a profession and 10 percent a business,” Stewart said. “For most law firms today, that scale has tipped precipitously the other way, to 80 percent a business and 20 percent a profession. I work to steer us somewhere in between the old and the new and to let all our offices thrive within the reasonable boundaries that define us.”
So the key is balance. “The biggest challenge to leading a 100-plus-year-old company is retaining the fundamental reason it was established while rein-venting it to address the needs of today’s marketplace,” Copeman said. “The customer of 1892 had very few choices for insurance companies and required fairly unsophisticated products to meet their needs.
“Today’s buyer looks at a plethora of companies with multiple product choices and demands very sophisticated products and services to protect their assets. Yet, they both should benefit from the financial strength and stability that a mutual insurance company can offer.
“Even though we have evolved from an organization that relied upon face-to-face, then mail, and finally telephone/e-mail contact to conduct our business, we have resisted the temptation to use voicemail as the primary means to communicate. We want our staff to be ‘problem solvers’ for the independent agents who place their clients’ business with CMIC.”
As with any business, customer service is the key. “We have to keep in mind our reputation that we have established through relationships with the community and clients that are decades old,” said David Herndon, President of the First State Bank of Kansas City, Kansas. “I have a tin coin box in my office that a person brought me a couple of years ago. He bought it at a garage sale. He brought it in because we were where his first account was, in 1942, and he wanted us to have it.”
Argentine’s Rielley says that the banking industry is homogeneous, which makes the method of delivery of services key to gaining and keeping customers. “Good customer service is what brings the customer back for a second and third time,” he said.
Mark Foster, Managing Partner of Stinson Morrison Hecker agrees. “Everything we do we try to make client-focused. We try to gauge everything by, ‘Does this add to our ability to be the best lawyers for our clients?'”
Foster says the subject of his firm’s business has changed as business itself changed.
“When I started practicing law more than 30 years ago, our business dealt mostly with local businesses,” he said. “Now local businesses have become national businesses. Our local client base has been acquired by larger businesses located outside the area. There is no such thing as standing still.”
Foster also notes that history has its encumbrances.
“Our firm is a product of a merger of two firms in 1998: Stinson Mag & Fizzell and Morrison & Hecker. The thing that is unique about law firms is how everyone becomes attached to the name. At the time of the merger, there was some significant discussion about what to name the new firm, regarding keeping the names, even though all five of the original partners were deceased.
“We determined which names would be kept by a flip of a coin. The next morning after the decision was made, a 90-year-old neighbor of mine said, ‘Mr. Mag’s name is not in the new name. There are only three letters and one syllable in his name. Couldn’t you have found room for it somewhere in the name?’”