Employee Incentive ESOPs: An Equity Tool to Promote Engagement and Performance

Employee stock ownership plans (ESOPs) are experiencing renewed interest in America. In recent years, new ESOP formation was largely driven by the aging of the Baby Boomer generation (widely defined as those born between 1946 and 1964), and their desire to liquify their ownership in closely held businesses while rewarding their employees. There are other new forces driving this trend—the quest for equitable solutions for the growing divide between have and have-nots, the need for employers to retain and reward employees in a competitive talent market, and succession planning. In this article, I will discuss how an Employee Incentive ESOP can be used to promote performance and engagement in a broad-based manner.

Succession Planning in Family-Owned Business Evidence From an Emerging Economy

Family-owned businesses (FOBs) play an important role in the economy of a country through the creation of jobs. However, most FOBs lack strategies regarding succession planning in both developed and developing economies. This study explores the strategies that are used by FOBs to prepare future leaders. Drawing on qualitative research design, this study employed a multiple case study approach and selected 13 cases by employing a purposive sampling technique from the FOBs of Pakistan. Semi-structured interviews were conducted with the successors of FOBs. The findings reveal that succession planning is pivotal for the development of business and the successful transition of FOB from one generation to another. Most of the respondents fully understand the importance of succession planning for the sustainability of the business. However, in some cases, socioemotional aspects of generational succession planning require strategies that concurrently focus on successor suitability, the consensus of the family, mode of transition, leadership, and challenges faced by the FOBs.

Organizing Human Resources in Family Firms During Generational Succession

HRM in family firm (FF) research has moved from its narrow focus on selection and succession planning towards studying the broader antecedents, content and outcomes of HRM. Today, HRM is acknowledged as a crucial factor for attracting new talent, improving employee attitude and behavior, enhancing performance, and fostering the long-term competitive advantages. The aim of this study is to identify which tools and practices FFs adopt with HR during succession planning. For example, do they use the replacement table with the aim of providing the firm and its management with a map that allows them to make the most appropriate decisions to replace a person who is no longer available to fill a certain position? Or is it possible to identify other tools? Similar questions help the authors to investigate around the importance regarding people in firms during generational succession.

Leadership Style and Succession Planning

The main aim of the chapter is to identify the leadership style that promotes succession planning through the existence of leadership development practices within organizations. The middle and top leaders are very important to identify and develop new leaders within the organization. The authors reach three main conclusions: 1) The laissez-faire leadership style is related to the succession planning. Succession planning is positively influenced by leaders that adopt a passive leadership style. 2) There are some practices of leadership development that are related to the existence of succession planning in organizations. 3) The 360º feedback and coaching/executive coaching are related to the succession planning. These practices promote the human capital development, so it is assumed that succession planning may be related to the leader development. Theoretically they concluded that organizations should have a leadership pipeline in order to prepare leaders to assume leadership positions.

Management succession planning and family-owned manufacturing businesses survival

It remains unclear how lack of management succession planning relates to the collapse of 87% of the Tanzanian family-owned manufacturing businesses (FOMBs) after the first generation. Also, the question of whether a firm’s background variables, namely; executive’s education level, business age, and business size, moderate the relationship between management succession planning and the survival of FOMBs remains unanswered. Therefore, this study investigated the relationship between succession planning and the survival of FOMBs, moderated by the firm’s background variables through the lens of resource-based theory as well as agency theory. A sample of 339 executives was randomly drawn from the FOMBs in Dar es Salaam city where the collapse of FOMBs after the first generation was revealed to be significant and surveyed using a structured questionnaire. Multiple linear regression was used as a quantitative data analysis technique with the support of SPSS as an analytical tool. Results revealed that management succession variables, namely; training the successor, successor involvement in business management and successor factors-work fit had a positive and significant relationship with the survival of FOMBs. However, the internal recruitment of the successor had an insignificant relationship with the survival of FOMBs. Therefore, management succession planning sustains the leadership pipeline and survival of the FOMBs through the involvement of the successor in business management, sufficiently training the successor, and handing over power to the successor whose competency and factors fit with the relevant work. The study contributes to an understanding of management succession planning variables and how they relate to the survival of family-owned manufacturing businesses. The study also provides a new conceptual framework on transgenerational management succession planning in the FOMBs.

Linking entrepreneurial orientation and managerial capacity to performance in dairy farms

The main objective of the study is to develop and test a model that emphasizes the relationship between entrepreneurial orientation (EO) and managerial capacity (MC) to the performance of dairy farms. This article also examines the effect of these variables on performance expectations as well as the succession planning of farms. Cross-sectional data were collected out of a sample of 158 dairy farmers in 2017 in Brazil. A path analysis approach has been applied to validate the hypothesized model. Results show that between EO dimensions, innovativity has the greatest impact on performance as well as on MC. MC is not significantly related to the current performance on dairy farms, but it is so to the performance expectation, which in turn has an impact on the succession planning of farms. The age of the farmers moderates the relations hypothesized in the model, especially between innovativity, proactivity, and MC in the farms’ performance.

Impact of effective governance structure on succession process in the family business: exploring the mediating role of management succession planning

PurposeThe aim of this research is to analyze empirical evidence of the effect of governance structure (GS) on perceived success of the succession process. It is also reported that in India, family firms have a more informal organization structure and governance and have an informal and unplanned approach to bringing the successors into family business. Previous studies have reported that GS is an important factor for a successful succession process. This study examines the role of management succession planning as an intervening variable to achieve perceived success of the succession process.Design/methodology/approachData have been collected using a questionnaire schedule with 113 respondents who are successors from family business firms in Kerala, India. The study uses snowball sampling technique. Partial least square-structural equation modeling has been used to do data analysis.FindingsThe results of the study showed that GS has a significant positive effect on the success of the succession process. GS has a significant positive effect on management succession planning. Management succession planning partially mediates the relationship between GS and perceived success of the succession process.Research limitations/implicationsThe results of the study indicate the effect of GS on the relationship between, perceived success of the succession process and management succession planning. The mediating role of management succession planning in the above relationship is also confirmed. Therefore, before starting the succession process a good GS should be put in place for ensuring the success of the succession process. Family firms must implement the succession plan well to make the succession process successful.Originality/valueThe main contribution of the study is to empirically investigate the effect of GS and management succession planning to enhance the success of the succession process.

SUCCESSION PLANNING AS A CRITICAL MANAGEMENT IMPERATIVE: A SYSTEMATIC REVIEW

This paper conducted a systematic review of succession planning (SP) articles published over the last decade. The Systematic Quantitative Assessment Technique was used to identify 174 SP articles. The review covered five key issues: 1) Time distribution, 2) Geographic distribution, 3) Article type, 4) Data collection methods, and 5) Themes explored. The findings revealed that interest in SP fluctuated over the last decade, and that South America and Oceania were the least represented by SP scholarship. The spread between conceptual and empirical SP articles were skewed towards the former, and survey was the most popular data collection method. Five themes were identified, with the most striking finding being that that if the ‘going concern’ principle of organizations is to be achieved, management must make deliberate efforts to formalize the SP process with the clear understanding that it is a continuous, transparent and participatory process, and thus a crucial management imperative.

Exploring the role of management in the implementation of talent management

The South African public sector institutions are faced with the challenges of proper implementation of talent management. The aim of this research is to explore the role of management in the implementation of talent management within the Department of Public Works, Roads and Infrastructure in the Limpopo Province. The inability by management to properly show their role in the management and implementation of talent management at all levels in the public sector has brought poor performance of duties by employees due to lack of motivation and low morale. A qualitative research approach was used. Purposive sampling was adopted using semi-structured interviews to gather data from participants. The findings revealed that challenges like career development, skills development, motivation, succession planning and remuneration packages including benefits allowances were the main limits which mainly prevented proper implementation of talent management in the Department.