Carrying a legacy Featured

8:00pm EDT August 26, 2008

By just about any measurement, Tony Martino was a healthy man. In his mid-70s, he was still active in the day-to-day operations of Maaco Enterprises Inc., the company that runs the eponymous auto body paint and repair shop chain he started in 1972. He was a highly successful, self-made businessman whose start-up credits also included co-founder of AAMCO Transmissions Inc. in the late 1950s as well as a Philadelphia-area recording studio and record labels.

Nothing kept his father down for long, says Mark Martino, so when he had trouble recovering from a series of colds last year, it drew some concern from those close to him.

“It was uncanny that it would take him two to four weeks to get over a cold,” Martino says. “In December, he caught a cold that was so bad it developed into pneumonia. He wasn’t a guy who ran to the doctor all the time, but he went to get some antibiotics for the infection. But they drew some blood, and when the tests came back, they found a few leukemia cells.”

Tony Martino spent 25 days in the hospital battling the disease. “We thought he was going to make it right up until the last few days,” Martino says. “But right at the end, he took a turn for the worse.”

He died on Jan. 27, less than three weeks after his 75th birthday. Though Mark Martino says his father was diligent about legacy planning, carrying on a business empire after the death of its founder is a daunting task, compounded by the personal grief of losing a parent.

Mark Martino succeeded his father as chairman and CEO of Maaco — which generated approximately $450 million in systemwide sales last year — and immediately began the task of piloting his family’s company through a difficult period.

“You have to work hard at every level,” he says. “Everybody is in a state of shock and mourning. You have to kind of cling onto each other as you evolve out of that stage.”

Focus on the tasks at hand

Well-known throughout the industry and the Philadelphia business community, news of Tony Martino’s death spread faster than the Maaco public relations staff could communicate. By the time the staff at Maaco had a chance to disseminate an official press release and call franchisees, many already knew what had happened.

“In an effort to put some formality to it, our Maaco public relations department put out press releases to the various communities my father was affiliated with — most specifically, a letter to all of our franchisees,” Martino says. “We also made sure every one of our franchisees was called personally by our in-house staff, so that they had something more than just an informal letter.”

With news of his father’s death spreading so rapidly, the focus soon shifted from merely informing the community and franchisees to plotting a course for the immediate future.

Martino — who had served as vice chairman immediately prior to his father’s death — gathered Maaco’s senior management team together. In addition to giving them some personal background on his father’s death, he wanted to set the ground rules for moving ahead with the company.

“I wanted to assure them that the vision for Maaco and the family’s interest in Maaco would continue,” he says. “I had been a part of Maaco in various capacities since its inception in 1972. I had worked with him in business for almost 40 years total by this point. But even though there was still some comfort in the business still being run by the family, those in the business were still pretty much in shock. They had to go through those first few weeks knowing that we had work to do to fulfill his vision and keep on moving forward.”

While still giving people closest to his father time and space to grieve and recover from the initial shock of his loss, Martino tried to focus as many people as possible on his dad’s legacy, not his loss.

“Our focus quickly turned back to where he had been directing the company over the last few years and look for ways to continue that or even accelerate that,” Martino says. “He put this company on a very good course.”

Tony Martino had made a career out of starting businesses, then leaving their long-term growth in the hands of others. Maaco was the one business he spent decades growing. Martino says that by the time of his father’s death, few other executives had his ability to guide a business through the ever-changing environment of the auto care industry.

“Over the last 10 or 15 years, there have been so many significant changes in the way cars are built, in the quality of materials, quality of metals, quality of paints,” he says. “So we had to develop an idea both from a marketing and a production standpoint to extend our brand and what our brand meant to consumers. At one time, it meant simply a paint job. My father worked over the past five or six years, and we’ve been extending that brand to mean a collision repair shop specializing in light collision damage.”

Martino says it was one of the greatest business lessons his father had to teach: Don’t shy away from a risk and don’t be afraid to change. With that lesson firmly embedded in Maaco’s culture, it made the transition to new leadership easier.

“Obviously, when you have a clean break from an icon to another individual, there are some concerns, but people understand that we are going to evolve and change as my father did,” Martino says. “There is always going to be an evolution in change.”

Build on the past

While Martino wanted to lead Maaco without deviating from the basic principles his father laid down, he says it would also have been a mistake to simply lead as though he is a carbon copy of his dad.

Every leader is unique, and though you might want to honor those who came before you, ultimately, you will put your own stamp on your company. If nothing else, changes in how business is conducted will force your hand.

In Martino’s case, he saw some definite ways he could take what his father had done and improve upon it, particularly in the area of technology.

“There is no doubt that my father was to be admired, but he did come from a different generation, born during the Depression and brought up in that era,” Martino says. “He had different perspectives on life and work than those of us born in the ’50s and ’60s. There are many things that can be done with Maaco to further it in the contemporary world of auto collision and body repair.

“My father was a techno junkie, he had every gizmo known to man, but he didn’t necessarily think successful businesses were predicated on the growth of technology, as you could well imagine for someone born in the ’30s.”

Martino says enhancing the computer network that connects the approximately 500 Maaco franchises with each other and corporate headquarters is among the most important issues the company is addressing moving forward.

“My father was right in that you aren’t going to build a successful business just because you have good technology,” he says. “But technology is an enhancement to training and fostering business at the field level, along with improved materials and more sophisticated techniques. It’s always a challenge to get people to change and see the opportunities that are emerging for us.”

Martino says his father also emphasized the importance of surrounding yourself with experienced leaders. At the time of his death, Tony Martino had assembled a leadership team with nearly 200 combined years of experience in the auto body industry. As a company grows, one person can’t lead it alone. It’s something Martino says his father learned over the years and a lesson he taught repeatedly.

“When my father started Maaco, he was 39 years old,” Martino says. “He was a young man with a lot of energy when he started the first Maaco centers. I was with him when he started the pilot operation in Wilmington, Del., and the first franchises in Tucson, Ariz., and Albuquerque, N.M. He was very involved in every aspect of the business.

“He was right there were the rubber meets the road for the first 20 years or so, and then as the company matured, more people were hired, and many people took on that role. The quality of the senior management and the character they had due to being mentored by my father for these last 10, 20 and 30 years, I can’t say it has been easy [to continue on without my father], but because of our senior management, it hasn’t been insurmountable to continue on with the business.”

Remember estate planning

Preparing an estate, particularly one that includes a large business entity like Maaco, involves some large-scale planning. But if the past 10 months has taught Martino anything, it’s that the problems are in the details.

“In a fundamental way, my father was very astute, and with regard to his estate, he had worked with very top-notch people and had everything really drawn up, all the I’s dotted and T’s crossed,” Martino says. “I can see how important that is, because as specific as it was, it really doesn’t take into account all the intangible things that occur when someone of such magnitude passes away, all the small issues.

“You have to sit down and take time to think about all the ramifications. Everyone involved did a very good job, but there are so many loose ends that you have to figure out.”

If your business is part of your personal estate, Martino says it’s never too early to put your wishes down in legal writing and discuss the future of your business with your family.

“Even though my father was 75, my grandfather and grandmother passed away just in the past couple of years, and they had both just turned 95. So it was a shock in that he expected to live another 10, 15 or 20 years,” he says. “You have to be prepared. Even if it’s properly presented and written up, it’s important to, at some point in your life, express your desires to your family members.”

However, don’t become entirely focused on your physical estate as the sum total of your legacy. You might leave money and assets for your family and your business, but your real legacy in business will be how you conducted yourself. That is what Martino would like people in the business world to remember about his father.

“In today’s business world, you have to sign contracts,” Martino says. “But behind that are the relationships that bind our franchisees to our franchisors. We don’t have supplier agreements, and we don’t have a lot of contracts because my father’s word was his bond. That impressed me about how important that is in business. Having been with him for so long, I’ve seen how valuable that is over the long haul, when people believe you and have faith in you and are willing to give you the time to develop your concepts and ideas.

“All throughout his life, he delivered hard work in business. You have to put in the time, you have to care. It’s really more of what you do than what you think or say. That was one of his most memorable attributes.”

HOW TO REACH: Maaco Enterprises Inc., (610) 265-6606 or www.maaco.com