The determinants of successful family business succession

Abstract

Family businesses represent a large proportion of the businesses registered in South Africa today, however very few of these businesses will cease to exist after the first generation. This represents a great loss in skills and wealth transfer, and a chance to contribute to economic growth. Family businesses need to learn how to manage the factors that affect the succession process. Therefore the aim of this study is to provide family business owners and managers with a keen insight of the determinants of successful family business succession.This research project consists of the analysis of eight South African family business case studies. Primary data was collected through semi-structured, in-depth discussions with family members in various capacities of ownership and management in the family business. A conceptual model was created to try and assist family businesses to understand the determinants of successful succession.Five key determinants were identified with a plethora of antecedent factors. The model acts as a mechanism to try and understand the various elements of the family business system and subsystems, and how they interact with each other at different stages of the business life cycle.