Jan 1, 1991

Daddy Dearest

 

Jake's toughness toward his family was the flip side of the affection he showed his workers. A bare-knuckled manager and driven businessman, Jake nonetheless helped found the sheet-metal union local at Artkraft. "He felt very strongly about people who put themselves out for him," says Marshall. "Since we were so involved with the theater business, deadlines were extremely important. Many times, to meet a deadline, guys would work around the clock. It was not unheard of for them to work until 12:00 or 1:00 in the morning, then crawl up on the workbench and sleep a couple of hours before waking up and going back to work."

* * *

When Jake died, in 1976, his son, Mel, then 58, had already toiled for 37 years under his father. Mel at last had the autonomy he had hungered for. Whether he had the knowledge was another matter. As Phil Marshall notes, "The business was largely confined to one man -- Jake -- who carried it around in his head. That deprived Mel of learning certain aspects of the business."

The relationship between Jake and his son could be described as a family-business archetype. Jake as the founder wasn't about to cede control. Mel as the denied heir grew only more bitter with time. Tom Hubler, a Minneapolis consultant to family businesses, says that the central issue between founder and son is a contradictory one. "The founder has a tremendous fear of letting go." On the other hand, "the founder desperately wants his son to take over the business." Those two conflicting impulses lead to confusion and bitterness. "The founder would feel betrayed and hurt if his son went and worked somewhere else," Hubler continues. "The son is not allowed to emancipate himself because he is told the business needs him. Yet he is not really allowed to grow within the business. Consequently, he gets frozen in his confidence and self-esteem."

When Mel took over at Artkraft, in 1976, the company employed about 75 people and had sales of $5 million. In 1980 Mel suffered a heart attack that would slow him down, cramping Artkraft's fortunes until his death. Under Mel, Artkraft suffered nearly a decade of no real growth. Tama Starr reflects wistfully on her father's ill fortune: "My dad did not have the physical energy or the hunger to take risks. I remember his saying, 'I'm sick and tired of being sick and tired.' "

Mel ruled the business with the same iron fist but not the same hands-on genius that had been his father's trademark. He had studied advertising in college; he focused on sales. Mel was Mr. Broadway, a walking neon sign, known for the Runyonesque figure he cut around town: the plaid suits, the gold chains, the gaudy wide ties, and the silver toupee. Mel even carried around in the breast pocket of his coat a trademark pair of chopsticks, with which he ate everything from filet mignon to ice cream.

Mel ran Artkraft out of his expense account. He loved doing deals in smoky nightclubs, sealing them with a handshake and a few numbers scrawled on the back of a cocktail napkin. Yet he lacked his father's acumen. As the business grew more complex, Mel tended to underbid big jobs just to close the deal. Then he would let people back at the office worry about how to keep the company from losing its shirt on the project. Mel lived for making the deal happen, not the details. Recalls Tama of her father: "Mel was kind of a romantic. He really did deal in abstracts, being a sales man and a designer. He was highly verbal, not the hardheaded businessman my grandfather was."

Mel steadfastly resisted updating the manufacturing process. He saw computers as gimmicky tools. Any kind of financial analysis of the business -- tracking how money was spent -- made little sense to him. Mel became a stranger to his skilled work force, which his father had carefully cultivated. Each of the three unions at Artkraft grew increasingly combative and less willing to go the extra mile. Thefts of equipment and supplies increased.

The world and the sign business were changing fast around Artkraft and Mel Starr by the time he died, in June 1988, at age 69. At the rate things were going, the business would soon follow. "We were shrinking," says Jonathan. "At a certain point we would cease to exist. We had lost our technical edge. We had an aging sales force. We were watching the world pass us by." Despite a few good years in the late 1970s, Artkraft's sales -- stuck at around $8 million -- had gone nowhere in a decade. Outdated equipment and underbidding consumed profit.

All that would remain for Tama and Jonathan Starr would have been to close the place up. Sleeveless to sleeveless in three generations.

* * *

The constant in any business is change, yet in family businesses change is often resisted. "A lot of family businesses are in maturing industries," notes Dennis Jaffe, a family-business consultant in San Francisco. "They are not innovative, and they don't invest in the future. The business really needs to be transformed every generation, and in some businesses a generation is now as short as three to five years." Obstructing change are the unreal expectations family members develop. Heirs proliferate on the payroll. Beholden to the company, they fail to question its direction. To change that tendency, says Jaffe, potential heirs must liberate themselves from the business in order to develop a sense of their own competence.

Independence took different forms for Tama and Jonathan Starr. In summers as a teenager Tama worked for the company, starting out as the receptionist and helping to write sales proposals. After college, in the late 1960s, she went to her grandfather and asked for a position in the company. He growled back that Artkraft "was no place for a lady." Rebuffed, Tama moved away. From 1970 to 1982 she lived in Hawaii and in California. She built a house on Maui and powered it with a windmill. She scratched out a living as a free-lance writer and songwriter. She formed a performing-arts troupe.

In 1970, at age 19, Jonathan told Jake he was going to India. With a male heir, Jake's impulse was to bind him to the family and the business. Jake forbade such a venture. Jonathan defied him. He was gone for eight years: seven in India and one in Africa. Jonathan, who never went to college, saw to his own education. He became a master printer and a photographer. He also found work as a sound engineer and a software writer.

Jonathan believes his act of defiance earned his grandfather's respect, perhaps because it stood in marked contrast to a similar family showdown that had occurred some 30 years earlier. Then Mel, fresh out of college, had gone to the West Coast to take a job with an outdoor-advertising company. Jake had pursued him and commanded him to come back to New York and work at Artkraft, and Mel had dutifully complied. "That was a major turning point in my father's life," says Jonathan.

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