Game Theory and Family Business Succession

2012 ◽  
Vol 26 (1) ◽  
pp. 51-67 ◽  
Author(s):  
Tim Blumentritt ◽  
Timothy Mathews ◽  
Gaia Marchisio
Keyword(s):  
Game Theory ◽  
Family Business ◽  
Family Businesses ◽  
Business Succession ◽  
Succession Events ◽  
Family Business Succession ◽  
Primary Contribution

One of the most significant challenges to enduring family businesses is the process of passing the leadership of a firm from one generation to another. This article introduces game theory as a model for examining succession as a set of rational but interdependent choices made by individuals about a firm’s leadership. Its primary contribution is demonstrating the application of game theory to understanding the decisions and outcomes of succession events.

scholarly journals Family Business Succession in Different National Contexts: A Fuzzy-Set QCA Approach

2019 ◽  
Vol 11 (22) ◽  
pp. 6309 ◽  
Author(s):  
José António Porfírio ◽  
Tiago Carrilho ◽  
Joseph Hassid ◽  
Ricardo Rodrigues
Keyword(s):  
Family Business ◽  
Fuzzy Set ◽  
Qualitative Comparative Analysis ◽  
Family Businesses ◽  
Expectation States ◽  
Succession Plan ◽  
Limited Applicability ◽  
Expectation States Theory ◽  
Business Succession ◽  
Family Business Succession

Family business succession is a key topic that has attracted considerable attention from researchers, especially in the last decade. Most research, however, is based on case studies with limited applicability and fails to present comparisons across international contexts that highlight differences in succession processes. We apply expectation states theory to analyze a sample of 128 observations in two Southern European countries, Portugal and Greece. We study configurations of successors’ characteristics, family business characteristics, the existence (or absence) of a succession plan, and successors’ motivation to succeed. Our aim is to reveal how these issues affect successors’ perceptions of preparation for succession using fuzzy-set qualitative comparative analysis (fsQCA). Family businesses are a dominant organizational form all over the world, and succession issues are critical for the sustainability of family businesses. Our findings suggest that different configurations of conditions influence successors’ perceptions of preparation for family business succession. Moreover, we verify the influence of cultural differences on these processes. This research helps fill a gap in the literature, showing the role of a set of characteristics in successors’ perceptions of preparation for family business succession. Our conclusions provide insight into the types of policies that can promote successful family business succession.

Cultural values and their implications to family business succession

2019 ◽  
Vol 10 (4) ◽  
pp. 281-292 ◽  
Author(s):  
Grisna Anggadwita ◽  
Werda Bagus Profityo ◽  
Dini Turipanam Alamanda ◽  
Anggraeni Permatasari
Keyword(s):  
Cultural Values ◽  
Family Business ◽  
Family Businesses ◽  
Chinese Family ◽  
Content Type ◽  
The Family ◽  
Succession Process ◽  
Business Succession ◽  
Family Business Succession ◽  
Practical Implications

Purpose The family business is one of the business entities that contribute to the economy of a country. Succession in the family business occupies a strategic position, especially in maintaining the company’s sustainability. The Chinese family business has unique characteristics in maintaining and growing its business with the cultural values that underlie how their business. The purpose of this paper is to discuss the cultural values of Chinese ethnic and their implications in the succession process in small family businesses in Bandung, Indonesia. Design/methodology/approach This research uses a qualitative method with the in-depth interview method as a data collection technique. The sampling technique uses purposive sampling, while to test the validity of research data using a triangulation technique. A total of four small Chinese-owned family businesses participated as informants in this study. The study will identify the stage of succession process in the Chinese family business. Findings There are several stages identified in the succession planning of small Chinese-owned family business in Bandung which include succession antecedents, succession activities and desired outcomes. The results showed that small Chinese-owned family business in Bandung has not applied the rules and procedures in the succession process. Most of the Chinese family business in this research still holds Confucianism culture; they prioritize boys as business successors, who have a greater responsibility rather than successor with other gender. Practical implications Several implications are discussed. One of them is the Chinese family business holding cultural values in the process of family business succession. Originality/value This research is expected to provide theoretical and practical implications for academics and family companies with similar cases.

Succession in the Family Business: Challenges for Successors from an Entrepreneurial Perspective

2014 ◽  
Vol 15 (4) ◽  
pp. 279-284 ◽  
Author(s):  
Daniela Weismeier-Sammer ◽  
Isabella R. Hatak
Keyword(s):  
Family Business ◽  
Family Businesses ◽  
Teaching Case ◽  
The Family ◽  
Succession Process ◽  
Business Succession ◽  
Business Challenges ◽  
Family Business Succession

Kronmann Wholesale and Retail is an outstanding family business with more than 300 years of history. This teaching case tells the story of two cousins who follow their fathers into a business full of tradition. The case gives students the opportunity to gain insights into the complex succession process of family businesses, as well as the challenges with which successors are confronted in the course of family business succession.

scholarly journals Family Business Transgenerational Continuity in Transition Economies: Towards a Conceptual Model

2013 ◽  
Vol 4 (2) ◽  
pp. 150-167
Author(s):  
Olga Štangej ◽  
Vida Škudienė
Keyword(s):  
Soviet Union ◽  
Conceptual Model ◽  
Transition Economies ◽  
Family Business ◽  
Former Soviet Union ◽  
Outcome Measurement ◽  
Family Businesses ◽  
And Performance ◽  
Business Succession ◽  
Family Business Succession

Within classification of emerging economies, Lithuania as part of the former Soviet Union belongs to the group of transition economies. In this paper, we discuss how theorizing leadership succession may contribute to the key strategic questions of succession arising among family businesses in transition economies. The purpose of this study is to revisit the phenomenon of family business succession and linkages among the goals of succession and performance measures of family business. Our study aims at providing three contributions to the current literature. First, it highlights the role of transgenerational continuity of family businesses in transition economies. Second, it revisits the concept of succession through identification of the third – leadership – dimension alongside management and succession. Third, it provides a conceptual model of family business succession outcome measurement and implications for further research.

scholarly journals Family Business Succession: What’s Motivation Got to Do With It?

2019 ◽  
pp. 089448651989475 ◽  
Author(s):  
Marylène Gagné ◽  
Connor Marwick ◽  
Stéphanie Brun de Pontet ◽  
Carsten Wrosch
Keyword(s):  
Intrinsic Motivation ◽  
Family Business ◽  
Family Businesses ◽  
Global Business ◽  
Local Economies ◽  
Psychological States ◽  
Successful Business ◽  
Business Structures ◽  
Business Succession ◽  
Family Business Succession

Family businesses represent 80% of global business structures, but the low rate of successful transgenerational succession can have drastic implications for employees and local economies. A 12-year longitudinal study of 89 Canadian family businesses revealed that successors’ confidence and perceptions of incumbent support predicted successor intrinsic motivation to take over the business, which in turn predicted whether the business was successfully transferred 12 years later. Incumbent support and intrinsic motivation mediated the relation between incumbent trust in the successor and successful business succession. This study demonstrates the dual importance of incumbent and successor psychological states in determining succession outcomes.

scholarly journals Family business succession in the Mazovia Region in Poland – needs and barriers

2019 ◽  
Vol 50 (1) ◽  
pp. 81-90
Author(s):  
Ludmiła Walaszczyk
Keyword(s):  
Family Business ◽  
Family Businesses ◽  
Business Activity ◽  
Local Authorities ◽  
The Family ◽  
The Future ◽  
Succession Process ◽  
Business Succession ◽  
Family Business Succession

Every year many companies disappear from the market due to the fact that there is no possibility to find the successor, who could take over the business activity. The owners do not wish to transfer their business to the heirs, not even mentioning the external successors. Thanks to the indication of needs and barriers of the family business successions, it will be possible to develop tools and services, which will improve the succession process in family companies and will help to maintain family companies in the future. In the article, the author presents the latest state of knowledge about the needs of and barriers to the succession of family businesses in the Mazovia Region in Poland. The author focuses on the results of unstructured interviews with entrepreneurs from family companies and representatives of local authorities.

scholarly journals The Determinants of a Successful Family Business Succession in Indonesia: A Multiple Case Study

2018 ◽  
Vol 1 (2) ◽  
pp. 87
Author(s):  
Suresh Kumar ◽  
Qireina Prameswari
Keyword(s):  
Family Business ◽  
Significant Proportion ◽  
Family Businesses ◽  
Related Factors ◽  
Business Context ◽  
Multiple Case ◽  
Business Succession ◽  
Relationship Of ◽  
Family Business Succession

<p>Family businesses play an important role in both developed and developing countries. They employ a majority of workforce establishing the newest jobs and generating a significant proportion of the gross domestic product. About 96% of the 165,000 companies established in Indonesia are family businesses. However, the survival rate of passing through the stage of second generations in family business is very low. This research has been conducted to analyse the determinants of successful family business successions. Qualitative research method was used to study four families. The conclusion from the study was that the determinants of successful family business succession are managing a complex relationship of successors and incumbent related factors, family context, business context, and having a structured agreement system.</p>

scholarly journals The Transition of Family Business Leadership:

2018 ◽  
Vol 2 (3) ◽  
pp. 101-104
Author(s):  
Dahliana Kamener ◽  
Norasekin Ab. Rashid ◽  
Daniati Puttri
Keyword(s):  
Family Business ◽  
Succession Planning ◽  
First Generation ◽  
Second Generation ◽  
Family Businesses ◽  
Business Leadership ◽  
The Family ◽  
Family Leadership ◽  
Business Succession ◽  
Family Business Succession

The issue of succession is very important because the successful succession leads to the sustainability of a family businesses (Sharma & Dave, 2013). Generally, the family businesses are difficult to flourish and even many have bankrupt. Some family businesses are bound on the first generation  and some have collapsed in the second generation.  Literature shows that just 30 percent of family businesses can be passed along to the second generation, and 70 percent fail after first generation step down because there are no preparation for succession and inability  of the next generation to control and run the company (Aronoff, (2004).  The study purposed to examine six hypotheses and the result showed the succession planning, non-family leadership, and decision making authority unsignificantly affect on the succession of the family business. Nevertheless, founder's influence, successor and strategic planning variable affect significantly to the success of family business succession at Padang city, West Sumatera.  

scholarly journals Business succession and its impact on change management in family businesses

2021 ◽  
Author(s):  
◽  
Julius Wilhelm Bornschein
Keyword(s):  
Change Management ◽  
Family Business ◽  
Building Materials ◽  
Family Businesses ◽  
Change Implementation ◽  
Home Improvement ◽  
Actual Change ◽  
Business Succession ◽  
The Impact ◽  
Family Business Succession

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.

Promoting Family: A Contingency Model of Family Business Succession

2008 ◽  
Vol 21 (1) ◽  
pp. 15-30 ◽  
Author(s):  
Susanne Royer ◽  
Roland Simons ◽  
Britta Boyd ◽  
Alannah Rafferty
Keyword(s):  
Family Member ◽  
Conceptual Model ◽  
Tacit Knowledge ◽  
Family Business ◽  
Family Members ◽  
Family Businesses ◽  
Contingency Model ◽  
Business Succession ◽  
Succession In Family Business ◽  
Family Business Succession

Succession is a challenge to family businesses for a number of reasons, including the need to address the issue of intergenerational handover. This article focuses on one aspect of succession in family business by investigating when family members are preferred as successors. Results from 860 family businesses indicate that specific (tacit) knowledge characteristics combined with a favorable transaction atmosphere, in certain contexts, make a family member the most suitable successor. A conceptual model is presented that outlines when inside-family succession is preferred.

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