Successful Succession in Family Businesses: Individual Level Factors and Succession Planning Models

Abstract

Master Thesis within Business AdministrationIntroduction: Succession process is the family firms is a complex phenomenon. One of the major factors which affect this succession process is the predecessor related individual factors. These factors act as enablers or otherwise for the successful succession process. Different succession planning models present a pathway for the successful succession of the family business. However these models are based on not only individual factors but take into consideration many other factors surrounding the organization. There is little research available only studying the individual factors in relation to the succession planning models. Purpose:The issue under investigation during this research will be that how central is the role of predecessor at the individual level to the succession process. Also this thesis will analyze why family firms succeed or fail in passing the business to following generations on the basis of different succession planning models in relation to the individual level factors. Method:A qualitative approach was used to fulfill the purpose of this thesis. Interviews with seven individuals were made to gather information regarding the role of predecessor during succession and succession planning process. All the interviews were conducted via telephone. Conclusion:Individual level factors related to the successor have a central role to play in the succession process of the business. When these factors are viewed in relation to succession planning models, the study shows that these factors have a direct relation to these models in terms of success or failure of the succession process. The major contributing factor to the success or failure of the succession process is that of the leadership provided to the organization by the predecessor. These leadership qualities change from one form to another during different phases of the succession planning models.