When is the right time for succession? Multiple cases of family businesses in Indonesia

Abstract

Purpose

Succession timing plays a key role in the part of the succession process. While much notice has been given solely to the viewpoint of predecessor and successor, less known about the schedule during this most critical family business dealings. The purpose of this research is to assess the right time for predecessors to let go of their leadership and allow the successor to take charge of the family business. Notably, it considers how the process of interaction between predecessor and successor may encourage successor capability, succeed the family business and following implications for the succession process as well.

Design/methodology/approach

An exploratory comparative case study design employed in order to disclose the time by time activities around the succession process. This study presented circa 11 case studies from family businesses of the food industry. Data gathered utilizing semi-structured interviews and formal secondary data from the organizations, all of whom operate in Java, Indonesia.

Findings

Findings reveal five critical outcomes. First, the results show that most of the respondents had no written succession plan and did not keep up the developmental stages, but the succession process was successful. Second, the study found a reduced age of successor even though the stages increase. Third, the respondents did not know when was the predecessor is getting busy managing the business, and some successors did not attend college as well. Fourth, the succession process of RC is the fastest and TY is the longest. Last, the succession process of the second-generation family business is faster than the third-generation.

Originality/value

This paper presents further evidence of the succession process of family businesses. It moves beyond a timing explanation of succession to develop a more sequentially aware understanding of the agility within the succession process. It contributes to the limited references of the family business in the food industry in Indonesia as well.

Citation

Tirdasari, N.L. and Dhewanto, W. (2020), "When is the right time for succession? Multiple cases of family businesses in Indonesia", Journal of Family Business Management, Vol. 10 No. 4, pp. 349-359. https://doi.org/10.1108/JFBM-10-2019-0064