Why execs turn to grandma for business advice

October 31, 2011, 3:55 PM UTC

By Vickie Elmer, contributor

FORTUNE — Some people turn to a mentor or maybe even a boss for management insights. Others look to Peter Drucker’s books for pearls of business wisdom. Atlanta-area attorney A. Wayne Gill counts on the wisdom of his grandmother.

Gill runs a law firm outside Miami; he’s bought and sold a few businesses and he is the author of Tales My Grandmother Told Me: A Business Diversity Fable. Despite his considerable business experience, he often recalls lessons he learned while at his grandparents’ general store in Jamaica, which he visited in the summers as a child. The store, which was located in the town center in Moneague, Jamaica, sold fish, meat, rice, sugar, sandwiches, and sodas for workers. His grandmother offered ice cream and even ran a small bar in the evenings.

“She was just such a central figure,” Gill says. She served as the sales person, and the deal maker, managing figures in her head and creating an ideal business environment.

Gill’s grandmother was all about diversification. She bought land and a couple of gas stations. Gill followed her model by moving into public speaking and minority business consulting.

His grandmother, known as Doris (her real name was Irene Macosta) also taught him to deal fairly with vendors and other business people. “My grandmother was already practicing win-win,” he says, which to him means being strong in your negotiations but not going overboard. Suppliers always wanted to do business with her, he recalls. Now, when he’s negotiating: “If I get a little less, if I make the other guy happier, we can have a long-term deal, and treat each other with trust and respect.”

A silent army of grandma disciples?

Gill is far from alone among executives who refer to their grandmothers as leadership guides, whether her name was Estee Lauder or Louisa.

Tim Sanders, a former executive at Yahoo and currently an author and consultant, weaved his grandma Billye’s insights and lessons on gratitude and confidence into his latest book, Today We Are Rich.

“She taught me confidence, and with confidence I could do anything at all,” says Sanders. “I understand where it started. I’m challenging other gurus and biz authors to ‘fess up’ on their grandmothers’ contributions.” Sanders says that he runs into half a dozen people a week who refer to their grandmother as a source of business inspiration.

Executives do not spend much time talking about their family and family histories, but their impact is considerable, says Michael Useem, director of the Center for Leadership and Change Management at the University of Pennsylvania Wharton School. “I’ve always been impressed in how many people I encounter — how much the family, their ancestors did what they did and influenced how they think about life now,” he says.

Sometimes it’s grandma or grandpa, and other times it’s an ancestor going back several generations. When Useem asks people who participate in his leadership programs which leaders they most admire, he often hears Nelson Mandela or PepsiCo’s Indra Nooyi or the recently deceased Steve Jobs. Around 10 to 15% refer to their parents, which is an extension of grandparents’ influence, Useem argues.

Cultivating a grandmother’s business sense

It may seem like a quaint idea in an era of constant change, where we receive a barrage of management insights and ideas via Twitter, blogs, and other sources. Leaders today must understand international finance and world economic crises, changing social media platforms and evolving societal tastes and trends. So how can grandma’s ideals or sampler-stitched wisdom really resonate amid such a dense business landscape?

Some say they use their grandmother’s wisdom as a firm foundation for how to behave in the business world. They rely on her principles and ethical standards.

Michael Platt, co-founder of hedge fund BlueCrest Capital Management, credits his grandmother with starting him in stock trading. “My grandmother was a serious equity trader,” he told Bloomberg News in an interview last year.

Alexandra Lebenthal, president and CEO of Lebenthal & Co., works at a desk that her grandmother used every day and says that she sees her lessons as useful in navigating Wall Street’s unsure waters. “She was very passionate about doing things the right way. I definitely got that from her,” she says of Sayra Lebenthal, who co-founded the Fifth Avenue municipal bond trading firm in 1925 with her husband Louis.

Her grandmother would always encourage clients to educate themselves about finance and their investments. “She would always caution people not to live beyond their means, which is important to business as well,” Alexandra says. So while other Wall Street honchos talk up a complex new product, if Lebenthal doesn’t see it clearly, “at the end, I say no.” This bit of wisdom has saved her from investing in some faulty products in recent years, she says.

Tim Sanders was raised by his grandmother, from the age of five until he graduated from high school. Grandma Billye, who is now 96 years old, loaned him $100 to start his first business, a fireworks stand he established in the 8th grade. When he hired friends and gave too much to them, she helped him understand profit margins. “You’ve got to get better at hiring people,” she told him.

Billye showed Sanders the lesson of the pecan — “eat the nut, dump the shells” — after he was teased at church camp. They called him squeaker because of his high voice. Billye showed him a pecan and asked him, “Can you eat this thing?” He said, “of course not,” and was then told to crack it open. “Every piece of criticism is a pecan,” Billye said. “Your job is to crack it open and find the nut and throw away the shell. What can you see that’s good? Every piece of criticism is a gift. Every failure is a gift — if you throw away the shell.”

Sanders says that he returns to this notion all the time, as he’s promoting his book and seeing reviews or receiving feedback from a speaking engagement. “People are incredibly direct, both negative and positive,” he says. Yet the criticism teaches you something you need to know; a lesson learned that would make any grandma proud.