Business succession and its impact on change management in family businesses

Abstract

The thesis “Family Business Succession and Its Impact on Change Management” aims to discover whether business succession and the business transition accompanying it has an impact on the implementation and management of change in family firms. It focuses on medium-sized family businesses in the wholesale building materials and home improvement retail industry in Germany. Although there is a plenty of research into the two study fields—change management and family business succession—research into the combination of both topics, especially the impact of one on the other, is rather limited. Therefore, this thesis aims to contribute to theory by reducing the gap in research into the combination of the two study areas. Furthermore, it addresses additional research needs and aims to enlighten the research gap by providing ideas with additional research needs. Especially in family businesses, business transition and internal changes are significant due to high failure rates in family business successions. Change management, however, is mainly connected throughout the research to changes resulting from changing markets and changing customer demands. Nevertheless, external change also requires internal adaptation in companies. With a focus on the wholesale building materials and home improvement retail industry in Germany, interviews are conducted with family business successors and predecessors concerning the business succession process and the implementation of change within the company over the period of the succession process. General ideas and findings from the data collection section are cross-checked with existing literature for the two fields individually first. Then, the results are merged in a chapter about the impact of business succession on change management in the final part of this research. The research results show that a differentiation between propensity towards change implementation and the actual change implementation must be made. There is a higher propensity towards change implementation among family business successors. Thus, the actual change implementation and the success of implementing change is furthermore dependent on other variables, such as employee base and culture, the predecessor’s and successor’s visions and ideas, financial aspects, and the successor’s human capital.