An Integrative Conceptual Framework for Sustainable Successions in Family Businesses: The Case of Taiwan

Abstract

Family businesses have long been one of the mainstream business models in developing countries. The smooth succession of control in family businesses is the key to their sustainable development. However, compared with other companies, succession in family business has demonstrated unique complexity, which also affects the development of the business. The paper is based on a review of the existing literature, starting from the theory of family business succession and combining with grounded theory. After that, we conducted field interviews of experts, coding the key factors affecting succession in family businesses in Taiwan. Finally, we explored the considerations and implications of the succession for inheritance planning. The results of this study show that consideration of succession in family businesses involves a multi-dimensional and complex decision-making process. Among the key considerations, it is found that corporate characteristics, family capital and niche inheritance are the most important without consideration of whether the continuation of the business after succession will be doomed to failure. In addition, the family relationship of affection and trust and commitment between both predecessor and successor are important factors that cannot be ignored, especially in a rapidly changing competitive market environment.

As Competências Centrais do Sucessor de Negócios Familiares a partir das Representações Sociais de Fundadores, Gestores e Herdeiros

“…Buscando garantir o desenvolvimento da empresa e a harmonia das partes interessadas, as primeiras gerações de sucessores de empresas familiares dependem fortemente dos fundadores, pois eles são os responsáveis por todo conhecimento (Liu, 2018). A figura do fundador é repleta de simbolismos, crenças, valores e tradições, que são difundidos sobre os membros da família/empresa (Teston & Filippim, 2016).…”

“…Logo, um dos fatores que pode contribuir para a sobrevivência, sucesso e sustentabilidade desses negócios é a sucessão efetiva (Ghee, Ibrahim, & Abdul-Halim, 2015), um processo crítico para a sobrevivência das empresas (Hillen & Lavarda, 2020;Richards, Nadine, Kammerlander, & Zellweger, 2019;Mair & Bitsch, 2018;Teston & Filippim, 2016;Costa, Nunes, Grzybovski, Guimarães, & Assis, 2015). O processo sucessório não é visto somente como uma transição de liderança de uma geração para outra; envolve também a transferência de patrimônio, valores de família (Liu, 2018), questões financeiras e emocionais (Mahto, Chen, McDowell, & Ahluwalia, 2019). Embora Lévesque e Subramanian (2022) entendem que o esse planejamento sucessório parte de uma reorientação estratégica, comunicado de forma apropriada para todo o grupo familiar para que haja expansão dos horizontes do negócio.…”

“…Portanto, define-se a sucessão como um conjunto de ações, eventos e acontecimentos ao longo da transferência de poder de um membro da família para outro (Teston & Filippim, 2016). É considerado um modelo de herança convencional, no qual os negócios da família são passados de geração em geração (Liu, 2018), o que distingue as empresas familiares das empresas não familiares (Mahto et al, 2019).…”

Communicating innovation and sustainability in family businesses through successions

“…Moreover, as long as the incumbent approves the successor professionally in the business after the successor’s accumulation of experiences both inside and outside the family business, there will be a positive influence on successor’s attitude, motivating the successors to continue the business ( Wang et al., 2019 ). The consideration of sustainable succession of family businesses consists of complexed and multi-dimensional decision-making process ( Liu, 2018 ). In a competitive and ever-changing market environment, positive relationships, trust and commitment between the incumbents and successors: along with corporate characteristics and family social capital are the key determinants that the businesses’ sustainability and survival through generations.…”

Difficulties in Building Relationships with External Stakeholders: A Family-Firm Perspective

“…There is a considerable agreement among researchers on the role of family businesses in the economy, especially in the context of stimulating economic growth and, as a consequence, societies' wealth [1]. The multifaceted phenomenon of family enterprises results from many factors, such as management and governance of firms, succession patterns, an ability to innovate, their entrepreneurial orientation [2][3][4][5][6], and inolvement of the owning families [7,8]. Likewise, family firms are in the constant process of searching for solutions which will strenghten their competitive advantage.…”