scholarly journals An assessment of the determinants of successor development in family businesses

2010 ◽  
Vol 10 (1) ◽  
Author(s):  
S. P. Van der Merwe
Keyword(s):  
Factor Analysis ◽  
Family Business ◽  
Family Members ◽  
Family Businesses ◽  
The Family ◽  
Management Succession ◽  
Generation Family ◽  
Successor Development ◽  
Measuring Scale

Purpose: The primary objective of this study is twofold: Firstly, to assess some of the determinants of successor development in family businesses with the focus on the role of the senior generation family members, and secondly, to make practical recommendations on actions that families can take to ensure successful management succession. Research methodology: The construct validity of the measuring scale was assessed by means of an exploratory factor analysis and by calculating Cronbach alpha coefficients. Thereafter, the correlation between the variables was explored by means of correlation analysis, t-tests and effect sizes. Findings: In this study the exploratory factor analysis provides some evidence of construct validity, but further research is needed before the measuring scale can be utilised to diagnose these issues in small and medium-sized family businesses. It is recommended that more advanced statistical procedures for scale validation, such as structural equation modelling, should be utilised in further development of the questionnaire. Supplementary research on the use of the measuring scale is also necessary to refine its norms. Practical implications: The importance for family businesses is that a better understanding of the determinants of the senior generation's role in the development of the prospective successor could contribute to the successful transfer of the business from the senior to the younger generation family members. It is, however, important to provide feedback on the diagnosis based on the proposed scale to individual family businesses. Originality/Value: Understanding the determinants of the role of the senior generation owner-manager in the development of the prospective successor is important to sensitise both role-players', as well as the senior and younger generations regarding their expectations, fears and needs in the process. This makes this measuring scale a useful tool to identify the state of these factors in the family business. Conclusion: This study confirms the important role that the senior generation family members play in the development of the younger generation successors to ensure that the prospected successor is competent to successfully manage the family business after management succession and to ensure the sustainability of the family business.

scholarly journals Portuguese and Brazilian Family Business: in Between Urgency and Delay Perceptions in the Succession Process

2020 ◽  
Vol 3 (2) ◽  
pp. 24
Author(s):  
Ana Paula Marques ◽  
Leandro Alves da Silva
Keyword(s):  
Family Business ◽  
Succession Planning ◽  
Family Businesses ◽  
Executive Succession ◽  
Family Conflicts ◽  
The Family ◽  
Management Succession ◽  
Business Succession ◽  
Depth Interviews

Family business has been the focus of several studies over the last two decades and its relevance has been supported by the interdisciplinary perspectives in the fields of management, entrepreneurship, economics, psychology, and sociology. Despite that, there is still insufficient knowledge about the key role of family influences in the business, namely the intergenerational management succession, its planning and effectiveness. According to a recent research focused on the entrepreneurial succession in Portugal (AEP, 2011), 50 percent of family businesses are not passed on to the second generation and only 20 percent reach the third generation. In fact, business succession planning has been identified as one of the most challenging steps in the life of the family firm, both in maintaining the competiveness of the business, and in overcoming intra/ inter family conflicts. Nonetheless, resistance to succession, relationship founder/ successor, planning of succession, and type of organisational culture, among others, explain how executive succession is one of the most important and hardest tasks in organisational life (Zahra, 2005). This paper will be supported mainly by qualitative data, taking into account the main results from the project “Roadmap for Portuguese Family Businesses” (NORTE2020/FEDER) developed in Portugal (Marques, 2018) and in Brazil (Silva, 2018), which analyses in-depth interviews conducted to Portuguese (N 23) and Brazilian (N 11) founders/managers/owners. In the present article we wish to discuss the main management challenges of a family business, particularly the importance of succession preparation and the role of the family in the socialisation of the second (third or subsequent) generation.

scholarly journals An investigation into the suitability of younger generation successors in small and medium-sized family businesses

2011 ◽  
Vol 42 (1) ◽  
pp. 31-44 ◽  
Author(s):  
S. P. Van Der Merwe
Keyword(s):  
Family Business ◽  
Family Members ◽  
Positive Influence ◽  
Family Businesses ◽  
Oblique Rotation ◽  
Independent Variables ◽  
Five Factors ◽  
The Family ◽  
Generation Family ◽  
Younger Generation

This study highlighted the importance of the suitability of the younger generation family members in small and medium-sized family businesses to successfully manage the business after management succession. Data from 270 questionnaires linked to 77 family businesses were collected and analysed. An Oblimin oblique rotation was performed on the principal components of the exploratory factor analysis. Five factors with eigen-values greater than one, explaining 65,78% of the variance, were extracted. These five factors describing the theoretical dimensions of the dependent variable, the suitability of the younger generation to manage the family business after succession, and the independent variables, namely value-adding by the younger generation, willingness of the younger generation, credibility of the younger generation and the degree of self-empowerment by the younger generation family members. The findings of this study indicated that the three independent variables, value-adding of the younger generation, the willingness of the younger generation to be in the family business and the credibility of the younger generation have a significant positive influence on the perceived suitability of the younger generation. Practical recommendations are suggested to ensure a smooth final transfer of the management and control of the business to the younger generation family members.

scholarly journals Analysis of Innovation, Proactive, and Risk Taking as Presentations of Entrepreneurial Orientation towards Business Success of Second and Third Generation Family Business in Indonesia

2021 ◽  
Vol 10 (1) ◽  
Author(s):  
Christina Whidya Utami ◽  
Damelina Tambunan ◽  
Metta Padmalia
Keyword(s):  
Family Business ◽  
Risk Taking ◽  
Entrepreneurial Orientation ◽  
Family Members ◽  
Family Businesses ◽  
Business Success ◽  
Third Generation ◽  
Scale Family ◽  
The Family ◽  
Generation Family

Research Objective: To analyze the effect of entrepreneurial orientation towards the business success of second and third generation family businesses in Indonesia. Methodology/ Research Approach: This study used a cross-sectional, correlation research design. The survey was conducted to 153 medium-scale family businesses that have run for 5-50 years and categorized as middle-scale business ran by the second and/ or third generation family. Hypothesis testing was done via a multiple regression using SPSS. Findings: there is a significant effect between entrepreneurship orientation, which is the independent variable of this study, that covers three indicators namely innovation, proactive, and risk-taking abilities. Innovative and proactive have a significant and positive effect, while risk-taking ability has a significant and negative effect on the success of family businesses in Indonesia. Research limitation/ implication: This study investigates strategies that family businesses use, in terms of entrepreneurial orientation. The limitations of this study are: Bias in assessment perspective of fellow families and the scale of the family business only focus on second and third-generation middle-scale family business. The implication of this research is to create an entrepreneurial orientation culture in family businesses that tend to be lacking innovative, proactive, and risk-taking behaviors, considering the amount of interference and involvement of family members in the management of their family businesses. Practical implication: It is hoped that the second and the third-generation family members show a better perspective exploration in seeing whether entrepreneurial orientation has been implemented and has an impact in creating business success. Thus, family businesses are expected to scale-up their businesses into large-scale companies, and at the same time, survive the succession phase of the next generation. Originality/ value: This study offers an analysis of a unique entrepreneurial orientation, given the personality, family, ownership, and management system in family businesses in Indonesia are different from other countries. Besides, there are influences of technological advances that may interfere family businesses, particularly the family system, in Indonesia

Family succession, professionalization and internationalization: a study of Brazilian family businesses

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Augusto Dalmoro Costa ◽  
Aurora Carneiro Zen ◽  
Everson dos Santos Spindler
Keyword(s):  
Family Business ◽  
Family Members ◽  
Secondary Data ◽  
Family Businesses ◽  
Three Dimensions ◽  
Content Type ◽  
The Family ◽  
Two Generations ◽  
Internationalization Strategies ◽  
The Relationship

PurposeThe purpose of this paper is to investigate the relationship between family succession, professionalization and internationalization in family businesses within the Brazilian context.Design/methodology/approachThe paper presents a multiple-case study method with three Brazilian family businesses that have at least two generations of the owning family involved in the business and an international presence of at least three years. In-depth interviews and secondary data were undertaken with family and non-family members of each case.FindingsThe authors' results show that a family business can boost its internationalization by introducing both succession planning and professionalization on international activities. As family members tend to be more risk-averse and focused on keeping the family business within the family, professionalization is a way of improving the firm's ability to expand internationally. This process tends to lead to lower performance by the firm for the first few months or the first year after the investment, but afterward, international performance tends to grow exponentially.Originality/valueOnly a few studies have been concerned on the relationship of these three dimensions. Thus, the research takes into account that professionalization and succession lead family businesses to improve their internationalization strategies.

Passing on the legacy: exploring the dynamics of succession in family businesses in Pakistan

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Asma AbdulRahim Chang ◽  
Muhammad Shujaat Mubarik ◽  
Navaz Naghavi
Keyword(s):  
Family Business ◽  
Succession Planning ◽  
Design Methodology ◽  
Family Firms ◽  
Family Members ◽  
Family Businesses ◽  
Content Type ◽  
Traditional Family ◽  
Interviewing Technique

PurposeBy taking the theory of entrepreneurial legacy as the baseline, this study explores the various aspects of succession planning in indigenous family businesses especially the role of female family members in succession and conflicts in family businesses.Design/methodology/approachThe study is qualitative in nature and adopts narrative inquiry to explore the aspects of succession planning. In doing so, the study utilizes an in-depth interviewing technique with nine participants who run their family-owned firms which are mostly in their second or third generation for analysis.FindingsThe findings are concurrent with the literature that indicates a lack of strategic succession planning although ordinary or natural succession does occur in some firms. The study also reports a lack of consideration for female members in succession, daughters in particular, for traditional family firms (FFs) in contrast to entrepreneurial FFs.Research limitations/implicationsThe study has many implications for family-owned firms in Pakistan as they need to align their family business with the theory of entrepreneurial legacy and its three strategic activities in order to ensure the longevity of their business.Originality/valueExploring how succession planning takes place in family indigenous family businesses and what is the role of female family members in succession and conflicts in family businesses are original contributions of this study.

Direct and indirect effect of entrepreneurial orientation, family involvement and gender on family business performance

2020 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Erny Rachmawati ◽  
Suliyanto ◽  
Agus Suroso
Keyword(s):  
Family Involvement ◽  
Family Business ◽  
Entrepreneurial Orientation ◽  
Business Performance ◽  
Family Businesses ◽  
Future Research ◽  
Content Type ◽  
The Family ◽  
The Relationship

PurposeThis study aims to determine the direct effect of entrepreneurial orientation on family business performance. This study also discusses the role of family involvement as a mediating variable and the role of gender as a moderating variable in the relationship between entrepreneurial orientation and family business performance.Design/methodology/approachA total of 328 hotels in Yogyakarta, Indonesia, were selected as samples by the convenience sampling method. Primary data is collected through structured questionnaires that are delivered by themselves to key people in the hotel such as owners, directors and key staff (HRD, financial, relationship). Hypotheses are tested by structural equation modeling procedures using AMOS 22.0. Sobel test is used to determine the indirect effect of the mediation variable.FindingsThe results showed that entrepreneurial orientation had no significant effect on family business performance. Family involvement acts as a full mediation in the relationship between entrepreneurial orientation and family business performance. Gender acts as a moderating variable that can strengthen the relationship between entrepreneurial orientation and family business performance. The results showed support for previous research.Research limitations/implicationsThe results of the study cannot conclude the national family business because it adopts convenience sampling and the sampling area is limited in Yogyakarta. Future research can use a larger sample. This study only researches hotels managed by family businesses, so it is not feasible to conclude for family businesses in general. Future research may choose to use several types of family businesses so that more varied results can be obtained. Future research could also compare hotels managed by family businesses with non-family businesses. The results also found that in addition to gender roles, respondent heterogeneity was an important component in the study of social identity. Therefore, research examining the influence of different cultures on the relationship between entrepreneurial orientation and family business performance should be an extraordinary topic for future study. Other results from this study also indicate that there is a role for religion in improving hotel performance. Future research is needed to further explore Islamic business modeling for family businesses.Practical implicationsThis finding has significant implications that can help family businesses in developing strategies that are suitable for business management. Entrepreneurial orientation occupies a strategic position in developing sustainable competitive advantage in the family business of the tourism sector especially the hotel business in Yogyakarta for the better. Besides, the results of the study also showed that entrepreneurial orientation had no significant effect on performance. This relationship becomes significant when combined with active family involvement. This finding also shows that entrepreneurial orientation has the potential to have a more beneficial effect because of the active involvement of the family in helping with business management, alleviating business-related problems, and having a significant influence when the family also acts as management.Social implicationsResearch findings indicate the role of gender in strengthening the relationship between entrepreneurial orientation and family business performance. This provides a good position for women in the social environment to show achievement. To place women on the side of gender equality and justice in the family business in Indonesia. By opening wider access for Indonesian women in the realm of business management, expanding women's participation in a family business, increasing the role of control for women, and increasing women's knowledge and skills to increase the benefits in managing family businesses so that they have sustainable resilience in the face of global competition.Originality/valueThe results of this study provide a new model in providing an overview of the direct and indirect roles (mediating and moderating) in the assessment of family business performance. This study uses three variables which are important in performance appraisal, namely entrepreneurial orientation (independent variable), family involvement (mediating variable) and gender (moderating variable). Where research that combines these four variables, directly and indirectly, has never been done before.

The Power of Invisible Women in the Family Business

1990 ◽  
Vol 3 (2) ◽  
pp. 153-167 ◽  
Author(s):  
Joanne Gillis-Donovan ◽  
Carolyn Moynihan-Bradt
Keyword(s):  
Family Business ◽  
Family Members ◽  
The Family ◽  
Comprehensive Picture ◽  
Power And Influence ◽  
The Invisible

Unacknowledged power and influence in the family business is often held by women family members who do not have formal roles or titles in the business. By clarifying the role of the “invisible woman,” consultants can provide a comprehensive picture of the multiple interacting emotional forces that influence both the family and the business.

scholarly journals Significance of Family Representation among Family Businesses in the Czech Republic

2020 ◽  
pp. 1-9
Author(s):  
Vojtěch MEIER
Keyword(s):  
Czech Republic ◽  
Correlation Analysis ◽  
Board Of Directors ◽  
Family Business ◽  
Family Members ◽  
Family Businesses ◽  
The Czech Republic ◽  
Level Of Involvement ◽  
The Family ◽  
The Board Of Directors

Family businesses are the foundation of any economy. They have been heavily influencing our society for many centuries. The level of involvement among family members is vital to flourish a family business. Therefore, research is conducted to assess the dependencies of six aspects of the selected family businesses in the Czech Republic. Several findings from the family survey are found in the correlation analysis: there is the highest indirect dependence between the number of directors and the number of family members actively involved in a family business, and some factors do not show dependence. This is evidenced by the relationships between the number of members of the board of directors or managing directors and the number of family members who are not interested in family business. Correlation analysis methods are used on top of the methods of analysis, synthesis and comparison.

scholarly journals Knowledge Management Untuk Menciptakan Daya Saing Bisnis Keluarga Pada Pengelolaan Bisnis Kuliner di Kota Palembang

MBIA ◽  
2020 ◽  
Vol 19 (1) ◽  
pp. 66-74
Author(s):  
Trisninawati Trisninawati ◽  
Dina Mellita
Keyword(s):  
Knowledge Management ◽  
Human Resources ◽  
Family Business ◽  
Human Resources Management ◽  
Family Businesses ◽  
Resources Management ◽  
The Family ◽  
The City ◽  
Depth Interviews

The culinary business in the city of Palembang is one of the family businesses that has been passed down for generations, the culinary business in recent years can create growth opportunities for employment and increase the ability of human resources. Management of many family businesses is controlled and operated by one member or several families and many family businesses have non-family members as employees. This study aims to determine the role of knowledge management in creating human resources who are ready to compete in the culinary industry in the city of Palembang. by analyzing the factors that must be considered such as the next generation development factors, information technology, and business development. This research uses a qualitative approach through in-depth interviews and direct observation. The results of this study indicate that the culinary business in the family business is still carried out traditionally the application of technology is still limited so the need for the role of knowledge management in order to be able to identify knowledge can realize competitiveness and sustainability as a benchmark for the success of the family business especially the culinary business in the city of Palembang   Abstrak Bisnis  kuliner di kota Palembang merupakan salah satu bisnis keluarga yang sudah turun temurun,  bisnis kuliner tersebut dalam beberapa tahun ini dapat menciptakan peluang pertumbuhan bagi lapangan kerja dan peningkatan kemampuan sumber daya manusia. Manajemen bisnis keluarga banyak dikendalikan dan dioperasikan oleh  satu anggota atau beberapa keluarga dan banyak bisnis keluarga memiliki anggota non keluarga sebagai karyawan. Penelitian ini bertujuan untuk mengetahui peran knowledge management dalam  menciptakan sumber daya manusia yang siap untuk berdaya saing  pada industri kuliner di kota Palembang. dengan menganalisis  faktor- faktor yang harus diperhatikan seperti faktor pengembangan generasi penerus, teknologi informasi,dan  pengembangan usaha. Penelitian ini menggunakan pendekatan kualitatif melalui wawancara mendalam dan observasi langsung. Hasil penelitian ini menunjukkan bahwa bisnis kuliner dalam bisnis keluarga masih dilakukan tradisional penerapan teknologi masih terbatas sehingga perlu adanya peran knowledge management agar   mampu mengidentifikasi pengetahuan dapat mewujudkan daya saing dan berkelanjutan  sebagai  tolak ukur keberhasilan bisnis keluarga khususnya bisnis kuliner  di kota Palembang.

scholarly journals The father’s role in supporting the son’s business knowledge development process in Vietnamese family businesses

2019 ◽  
Vol 11 (2) ◽  
pp. 258-276 ◽  
Author(s):  
Thanh Trung Pham ◽  
Robin Bell ◽  
David Newton
Keyword(s):  
Family Business ◽  
Development Process ◽  
Second Generation ◽  
Family Businesses ◽  
Knowledge Development ◽  
Content Type ◽  
The Family ◽  
Business Knowledge ◽  
Succession Process

Purpose Many family businesses do not survive into the second generation. A common reason put forward for this is poor succession planning for the second generation. This paper is designed with the aim to explore the role of the father in supporting the son’s business knowledge and development in Vietnamese family businesses. Design/methodology/approach This research adopted an inductive qualitative approach using multiple face-to-face semi-structured interviews with five father–son succession pairs. The interview participants were a cross section of Vietnamese family businesses, where the father–son pair was involved in the process of business knowledge transfer and the succession process was at an advanced stage. Findings The results suggest that the father plays different roles at different stages of the son’s business knowledge development process. In particular, the father acts as an example during the son’s childhood; a supporter to encourage the son to gain more business knowledge from both formal education and working experience outside the family business; a mentor and trouble-shooter after the son joins the family business as a full-time employee; and as an advisor after the son becomes the leader of the firm. Originality/value Most Vietnamese family businesses are still operating under the control of the first generation, and as a result, research into the succession process in Vietnam can help to provide valuable insights. Furthermore, existing research into the role of the predecessor in the whole process from the successor’s childhood until the end of the succession process is ambiguous and requires further research to clarify this research gap.

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