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Article
Publication date: 6 June 2022

Lil Rodriguez Serna, Dorothea Maria Bowyer and Sheree K. Gregory

Although the use of management control systems (MCS) is known to support organizational strategic success, the role played by MCS to monitor stakeholder satisfaction, thus…

Abstract

Purpose

Although the use of management control systems (MCS) is known to support organizational strategic success, the role played by MCS to monitor stakeholder satisfaction, thus minimizing stakeholder relationship severance, during uncertain events such as business succession remains underexplored. Thus, the authors investigate why succession creates uncertainty and how can stakeholders' concerns assist in contingently adapt the family businesses (FB) MCS to assist decision-making during succession.

Design/methodology/approach

The authors use a qualitative approach and a multiple-case study design. The authors conducted 30 in-depth interviews within 6 Australian FB SMEs. Interviewees included owners, successors, senior managers, customers and suppliers.

Findings

The authors' findings suggest that owners' perceptions, that intergenerational succession causes minimal stakeholder disruption, results in MCS not adapting to monitor the uncertain event. Other stakeholders, on the contrary, highlight the need for MCSs to evolve and adapt during the process to assist owners monitor stakeholder-derived success factors to secure the long-term sustainability of the FB.

Originality/value

The novelty of this research is based on the inclusion of non-family stakeholders, such as customers and suppliers, as part of the sample. This approach allowed for stronger conclusions and a broader overview of the succession issue.

Details

Journal of Small Business and Enterprise Development, vol. 30 no. 2
Type: Research Article
ISSN: 1462-6004

Keywords

Article
Publication date: 16 July 2021

Lil Rodriguez Serna, Dilupa Nakandala and Dorothea Bowyer

Successors' unwillingness to participate in the family business is known to impede intergenerational succession. However, little is known about why those considered eligible, do…

Abstract

Purpose

Successors' unwillingness to participate in the family business is known to impede intergenerational succession. However, little is known about why those considered eligible, do not choose to become the next chief executive officer (CEO). The authors investigate why some eligible successors withdraw from the succession process while others remain involved. The purpose of this paper is to build theory for which the authors made use of purposive sampling techniques that complied with certain criteria.

Design/methodology/approach

The authors use an inductive, exploratory multi-case study design and investigate six Australian food manufacturers.

Findings

This paper's analysis reveals that successors' decisions are driven by dimensions: pursued outcome and reciprocity. Eligible successors withdrawing from succession are concerned about personal financial sustainability and the business' growth potential; this is accompanied by negative exchanges with the incumbent.

Research limitations/implications

The authors studied a limited number of organizations and these were mainly managed by owner/founders. In this type of organization, successors have been widely exposed to the business and its struggles from an early age. Differences can be present in businesses managed by later generations whose emotional investment, therefore, socio-emotional needs might be different from the cohort being investigated. Second, the authors' aim in carrying out this study was to build theory for which we made use of purposive sampling techniques that complied with certain criteria. Further studies aiming at generalizable results would shed light on the usefulness of the typology and whether other rules apply to the incumbent–successor relationship while ascertaining how the exchanges contribute to the successor's decision to remain or withdraw from the family business.

Practical implications

This study reveals the crucial nature of the incumbent in the succession process. Their role is not limited to how they interact with the successor but how deeply incumbents manage to understand and monitor the successor's motivations and concerns. Incumbents aiming at retaining eligible successors need to thoroughly understand successors' motivations for agreeing to become the next CEO.

Originality/value

This paper is one of the first to investigate successor withdrawal post training. The authors' methodology includes the responses of non-family senior managers to provide an objective view on the family dynamics.

Details

Journal of Family Business Management, vol. 12 no. 4
Type: Research Article
ISSN: 2043-6238

Keywords

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