Founders aren’t just figureheads; they are the foundation of the business.
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Successful companies are the offspring of their founders and are rooted in the personality, values and philosophies of those individuals who were able to muster that American spirit of entrepreneurialism and take a plunge few dare to even consider.
That’s why the recent unceremonious ousting of Men’s Warehouse (NYSE:MW) Founder George Zimmer is so unfortunate. I fear this is another example of just how short-sighted publically-run companies (and Wall Street for that matter) have become in the new economy.
Regardless of perceived character flaws, founders should always have a role in their company because their personal commitments, connection to the brand and guiding values aren’t things that can be easily manufactured.
The personal obligation and emotional bond founders have with their business can’t be created overnight. The growth of a founder’s business and his/her personal life journey are intimately woven together and often drive each other. In a recent LinkedIn article by Ron Shaich, founder and chairman of Panera Bread Company (NADAQ:PNRA), he pointed out that a “founder's commitment runs far deeper and is often longer term in nature than that of the professional manager.”
Research from the Center for Management and Economic Research at École Polytechnique shows family-controlled businesses tend to outperform their professionally-managed counterparts during economic downturns and over the long-term. Emotional connection is a powerful motivator and one that shouldn’t be so quickly dismissed as it apparently was in the case of Zimmer.
Connection to the Brand
Zimmer wasn’t just the face of the brand, he was also the force behind the brand. Unless you have been living under a rock for the past 30 years, you’ve heard Zimmer’s famous tag line “You're going to like the way you look. I guarantee it." This is the kind of guarantee only a founder can make. The authenticity of his style and the way he delivers that line comes from a genuine connection to the brand consumers can sense.
Customers often associate brands with their founders and feel connected to them when they buy their products or patronize their services. Just take a look at the outpouring of support for Zimmer even though very little is known about what really transpired.
Strong brands are often rooted in the values and philosophies of their founders. Companies like Marriott (NYSE:MAR), Wells Fargo (NYSE:WFC), and Chick-fil-A retain and promote their brand’s strong commitment to their founder’s heritage and have been able to endure tough economic times.
Values are the core principles that guide us in how we make decisions, particularly in tough times. Because companies are often expressions of their founders, when founders have a strong set of values, their companies also have clear guiding values. These principles drive decision making at all levels and act as a compass in times of uncertainty. Let’s not forget that Zimmer’s decision making took Men’s Warehouse from a single store in Texas to more than 1,000 locations nationwide.
Founders don’t live forever, which is why savvy executives must remain true to those who came before to retain a company’s reputation and success. Just as we fall back on the country’s founding fathers as a guidepost for how to govern in times of uncertainty, so too should business leaders fall back on their corporate founders to keep them moving in the right direction. Founders like Henry Ford, Walt Disney and Steve Jobs are as important to their companies and American business as Benjamin Franklin, George Washington and Thomas Jefferson are to this nation. America is a nation founded on the spirit of entrepreneurialism, so let’s be sure to honor those who have and will continue to contribute to that success.