Digital Dealer - October 2019 - 10

D E A L E R OP S & M ANAGEM ENT: Own e r shi p

By Loyd Rawls
Chairman,
The Rawls Group

Evolution
Revolution:
A Word to
Successors
I was traveling with Dr.
Merlot while visiting a
new client, and I witnessed
one of his famous tirades
that is worth sharing. Our
client was a gentleman in his
late 60s and the personification of "old school." He had
been in the same 20 Group
for the last 35 years, he did
not use email, and he
believed everything the
factory told him. The net
working capital of his five
dealerships was over four
times guideline. His daughter Sarah, age 35, had
contacted us after a visit at
NADA and all but forced her
dad to engage us. Her issue
was that her father should
have retired three years
earlier when she joined the
family business from a
marketing job in the big city.
There were no other children
active in the business, and
there were a host of key
managers, notably GMs,
who "Dad" considered part
of his family. We had
completed our Phase I
assessment, we had
connected well with Dad,
and he was confident we
could help him restrain his
daughter.
Sitting in the conference
10

OCTOBER 2019

room with him and Sarah,
we were endeavoring to
confirm the priority of the
succession plan deployment
action items.
"We are honored and
delighted to facilitate deployment of your succession
plan. Thank you for your
confidence and the opportunity to demonstrate our passion for your succession and
ability to help you achieve
your goals." With Doc on my
right, I continued with the introduction. "Here is our draft
Update Action Agenda. We
want to discuss and refine
these action items to confirm
a compatible strategy for the
achievement of your goals."
Dad was drinking his coffee and not paying too much
attention to the five-page
document we were reviewing, that confirmed this was
a target-rich environment for
succession planning. In contrast, Sarah was searching
through the pages, giving
me concern that we had
omitted something important. Then she stopped,
folded the pages back, and
pointed at the document.
"Why is 'Exit Strategy' number 26 on your list? That's
our number one priority!"

D I G I TA L D E A L E R . C O M

she proclaimed in her typical
dogmatic manner.
"Thanks for pointing that
out," I responded. "We
get it; exit strategy is one
of your highest concerns,
but we believe a few other
items may take precedent.
Confirmation of priority is
precisely why we are having
this discussion."
Her Dad quipped, "I don't
plan to go anywhere. Where
would I go? Until death do
us part does not mean that
your mom and I should
share lunch every day," he
offered in his typical jovial
tone. "We are making more
money than I ever dreamed.
The last eight years or so
have been the most fun in
my entire career. I no longer
worry about survival," he
broadcasted proudly.
Doc and I watched as
Sarah sat up to the table to
defend her point. "Dad, as
we have talked repeatedly,
this industry is changing
fast. We are stuck in the
90s which does jeopardize
our survival. You and your
cronies, including your
100-year-old accountant, do
not want to change anything;
DMS, vendors, you name it.
I am so frustrated arguing

over every little change that
I suggest. My twenty group
laughs at me. Your exit strategy has got to be our top
priority, or I am done!"
The girl's face had turned
red as she sat back in her
chair with arms crossed, as
though the verdict had been
read. To keep the dialogue
rolling, I jumped back in,
"Sarah, we hear you, and
we also agree Exit Strategy
should be a high priority.
However, we want you to
consider some competing
priorities such as your dad's
personal financial planning."
"I will not argue there's
a lot to do here," responded Sarah reflexively, "but
nothing is more important
than Dad's exit strategy!" I
was preparing to respond
when I was distracted by
humming from my right. I
looked over to find Dr. Merlot
tapping a catchy beat on the
conference table. I looked
back to Sarah and her dad
in wonderment, and then we
all looked back at Doc as he
was grinding out a seat-boogie, humming the words of
what sounded like a Motown
tune.
"Evolution, revolution,
doo, da, doo, doo. Evolution,
revolution, doo, da doo, doo;
and the beat goes on!"
Doc noticed that we were
watching and poorly tried
to look surprised. No doubt,
he had been planning this
performance. "Oh, sorry,"
he offered with an impish
smile. "While I was listening
to Sarah, a song came to
mind that just absorbed me.
I'm sure you know the tune,
'Evolution, Revolution, doo,
Continued on pg. 12
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