Succession Process in the Family Business: A Case Study of Pekalonganese Batik Cloth Enterprises, Indonesia

Abstract

Purpose: The main purpose of this study is to explain the role of parents in teaching business management to their children from an early age for the success of family business succession.
 Methodology: It was a qualitative study and data were collected by observation, in-depth interviews, and documentation. The focus of this study was the succession process of the PekalonganBatik business analyzed from the entrepreneurial learning perspective. Interview questions focused on entrepreneurial learning and how parents teaching business management. Interviews conducted into 6 Informants. Each interview took between 35 – 45 minutes.
 Main Finding: The results of this study showed that parents usually introduced business management to their children from an early age. They made their children involved in the business to know about the planning, producing and marketing of Batik cloths. The indicators of giving entrepreneurial learning to children are involving them in business activities; they learned to manage the business by doing those activities at their parents’business.
 Implications/Applications: This study can be useful for another batik enterprises center to guidelines for succession.
 Novelty/Originality: This research was to explore the parents to involve their children from an early age to help manage businesses in preparation for business succession.

The Challenges of Family Business Succession Process: a Case Study of Two Major Batik Peranakan Entrepreneurs in Pekalongan and Solo

“…Kusumantoro and friends in their research on Batik entrepreneurs in Pekalongan also found that succession planning was carried out by parents by involving their children from childhood in the business processes of family companies, both in terms of production and management by involving them little by little in the company's operational activities (Kusumantoro et al, 2020). While Umans' research from inter-generational relationship's point of view found that the higher the quality of relationship between predecessor and successor the more it strengthens positive effects of the succession intention on the succession planning level (Umans et al, 2019).…”

“…Employees who work on a complex series of batik processes will also be included in those who will be transferred to successors. Not to forget, people who have become customers of family batik, become part of the legacy that is passed on by successors (Kusumantoro et al, 2020). Not only tangible inheritance is passed down, no less important is intangible abilities such as passion and other soft skills required, namely the ability to innovate, communicate and negotiate, make decisions (Duh, 2014).…”

The resilience of Chinese minorities: Transformation of Chinese entrepreneurs in Lasem batik industry, Central Java, Indonesia

“…The batik business is generally managed by family members up to several generations, either by immediate family or extended family. All business activities of the Chinese community are closed, so that non-family members are omitted (Kusumantoro et al, 2020;Sharma et al, 1997).…”