Abstract:
A significant number of businesses operating in South Africa can be categorised as familyowned
businesses and contribute substantially to employment creation, poverty eradication
and wealth creation. Nonetheless, their longevity through generations remains a major
cause for concern for all stakeholders. South African economy is characterised by a history
of apartheid, where prior to 1994, the black majority only owned less than 5 percent of the
businesses active in the economy. Since then, black majority participation in the economy
has increased driven by the Black Economic Empowerment (BEE) legislation. Therefore,
the aim of this study is to understand the influence of the incumbent, the successor, the
family and the business, on management succession within black family-owned businesses
in South Africa.
The study followed an exploratory qualitative approach, using semi-structured interviews.
Thirteen black family-owned business incumbents were interviewed with a view to answer
the research questions. From the literature, 17 of the most widespread factors that
influence management succession in family businesses were derived and formed the basis
of the constructs or themes adopted during data analysis. All the interviews were recorded
and then transcribed into text. A directed content analysis using ATLAS-ti was used to
analyse the data, while constant comparative analysis using a meta-matrix was used to
establish common themes to specific groups of respondents.
The key findings showed that incumbent of black family-owned business regard the
successor and incumbent-related factors as the predominant drivers of management
succession. Commitment and interest of the successor towards the business and the
quality of the relationship between the incumbent and the successor have a strong
influence on decisions and criteria design across all the stages of the management
succession process. From the family perspective, natural succession based on birth order
and gender was considered to be the key determinant of the succession pool composition.
Support of the successor by the family members through acceptance of the choice and not
passing judgement when mistakes are made emerged as the critical family dimension that
will influence the overall management succession process. In terms of the business itself,
the size and nature of the business and change in market conditions were established to
have a major influence on the succession process.
