Avoiding the Best Practices Trap in Family Business Succession

Sathe, Vijay; Enrione, Alfredo; Finley, Donna

doi:10.1016/j.orgdyn.2021.100876

Cited by 3 publications

(2 citation statements)

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“…Nigeria, a developing country, exemplifies the prevalent post-transition challenges of family-owned businesses (Oguonu, 2015; Luan et al ., 2018). Most studies have been carried out to explain why family firms seem to experience a decline in productivity and subsequently collapse after the founders' demise (Dalpiaz et al ., 2014; De Massis et al ., 2008; Kandade et al ., 2021; Le Breton–Miller et al ., 2004; LeCounte, 2022; Miller et al ., 2003; Nave et al ., 2022; Sathe et al ., 2021; Sharma et al ., 2003; Steier and Miller, 2010). Studies on profitability constraints of family businesses, particularly after the transition period, indicate that most family firms fail to sustain the success of the founders (Luan et al ., 2018), and the propensity for failure is amplified after the founder's demise.…”

Section: Introductionmentioning

confidence: 99%

Leadership transition and survival strategies for family-owned SMEs in an emerging economy

Nwuke

Adeola

2023

JFBM

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PurposeThis study explores the different survival strategies employed by family-owned small and medium-sized businesses in Nigeria. The study delves into the dynamics of ensuring business continuity from founders to successors and identifies the success factors that can facilitate seamless leadership transition outcomes.Design/methodology/approachThis study utilised a qualitative multiple-case study approach, with the population consisting of founders from three medium-sized family businesses in Nigeria. Semi-structured interviews were the primary data collection tool used in the study. Furthermore, company documents were analysed to gain further insights into the leadership transition strategies employed in the selected businesses.FindingsSuccessful transition and survival of family businesses are dependent on the founder's desire and support for transition, successor preparation, building trust and credibility in successors, and instilling a clear vision for the business.Research limitations/implicationsThe study's findings will provide valuable insights to leaders of family-owned SMEs, specifically in the development of effective leadership transition action plans. It should be noted that the study is limited to three family-owned businesses in two locations in Nigeria, which may restrict the generalisability of the findings. Despite this, the study offers novel contributions to the current literature by presenting practical strategies for achieving the survival of family businesses in an emerging economy.Originality/valueThis study proposed strategies for business survival, continuity, sustainability and seamless leadership transition for small and medium-sized family-owned businesses. Importantly, the study recommends action plans for present and prospective family business leaders to deepen succession pathways.

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Section: Introductionmentioning

confidence: 99%

Leadership transition and survival strategies for family-owned SMEs in an emerging economy

Nwuke

Adeola

2023

JFBM

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“…Family business leaders might consider planning how to make their family business more approachable for the next generation to consider as their main career choices. Building a strong and healthy relationship with a next-generation leader in the family business and gaining an understand that the older generation will need to surrender the company to the younger generation will certainly help build a positive perspective of continuing the family business for the next generation(Sathe et al, 2021). Secondly, entrepreneurial education will place a different emphasis for students on continuing a family business in the non-Covid era versus the Covid era.…”

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confidence: 99%

Succession Intention in Continuing Family Business in Indonesia during the Covid-19 Pandemic

Pribadi¹,

Agustiawan²

2021

Int. res. j. bus. stud.

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The Covid-19 pandemic disrupted many industries and created a different reality of function in terms of several aspects, including family business and succession. This paper discusses how family business successor intentions regarding succeeding the family business in the near future have been affected by the pandemic. The subjects of our study are senior undergraduate business students that could potentially become successors in their family business. Our model is based on the Intention Model from the Theory of Perceived Behaviors, modified from our previous study with Intention to succeeding family business as the dependent variable. Data of 203 valid respondents was collected through quantitative survey and analyzed using a multiple linear regression model. The results of our study show that, during the pandemic, the intention of the heirs of the family business in succeeding his/her family business will be determined by the successor’s own attitude in succeeding family business, campus education, familiness, and resiliency of family business situation in facing the pandemic.

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“Who Comes Next?”: Planning and Managing Sustainable Initiatives that Facilitate Family Business Succession

Prazeres,

Ferreira,

Ferreira

et al. 2024

J Fam Econ Iss

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Family businesses are increasingly recognized for their significance in the global economy, constituting a growing portion of companies worldwide and elevating the importance of this topic on governmental agendas. Unique challenges confront family firms, intertwining business decisions with familial repercussions. Among these challenges, the succession process emerges as a critical threat to their continuity. Inadequate solutions to the question of succession often lead to organizational failure, underscoring the urgency of addressing this issue. This study endeavors to construct an analysis model to support decision-makers throughout the succession journey, integrating a constructivist approach that merges cognitive mapping and interpretive structural modeling (ISM). This dual methodology facilitates the swift identification and analysis of factors crucial for smoother family business succession. The model development leverages insights from an expert panel and entails delineating cause-and-effect relationships among identified determinants and prioritizing these factors based on their significance. Subsequently, the model undergoes validation through a consolidation session with experts from the Associação de Empresas Familiares (i.e., Family Business Association in Portuguese), who assess its practical applicability. This includes perspectives from a Brazilian expert renowned for his understanding of family business dynamics within an emerging economy—Brazil. The insights gleaned from these sessions inform recommendations on implementing the tested procedures within real-life family enterprises, thereby contributing to the sustainability and longevity of these businesses.

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Avoiding the Best Practices Trap in Family Business Succession

Cited by 3 publications

References 0 publications

Leadership transition and survival strategies for family-owned SMEs in an emerging economy

Leadership transition and survival strategies for family-owned SMEs in an emerging economy

Succession Intention in Continuing Family Business in Indonesia during the Covid-19 Pandemic

“Who Comes Next?”: Planning and Managing Sustainable Initiatives that Facilitate Family Business Succession

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