DETERMINANTS OF SUCCESSOR SELECTION: EVIDENCE FROM FAMILY-OWNED SMES IN MOROCCO

The Covid-19 dilemma has resulted in a slew of restrictions that have had major economic ramifications around the world. Most economic actors are in a difficult condition as a result of the prolonged crisis. Every business, particularly family businesses that play an important role in the global economy, has been impacted by the crisis in some manner. Small and medium-sized enterprises (SME) make up the majority of family businesses, which account for a significant share of the economy. Given the obvious importance of family SMEs, the current crisis necessitates an urgent investigation into the strategic measures that family SMEs employ in order to survive. This research sought to answer the question of what strategic actions Romanian family SMEs are taking to deal with the Covid-19 crisis situation. Qualitative research method was used to carry out this study. Seven Romanian family SMEs in the IT, e-commerce, construction, design, building, education, and sports industries were interviewed in twelve semi-structured in-depth interviews. The findings revealed that in order to deal with the crisis, Romanian family SMEs employ different sets of strategies. The implementation of strategic measures was discovered to be dependent on five key factors: the impact of the crisis on the enterprises, the firms' industry, the particular governmental constraints, the firms' crisis readiness, and the strategic measures' evolution through time. One noteworthy finding was that, despite the challenges of supply chain interruptions, all of the enterprises in the sample profited financially in the long term from the crisis.

PurposeThis study explores the different survival strategies employed by family-owned small and medium-sized businesses in Nigeria. The study delves into the dynamics of ensuring business continuity from founders to successors and identifies the success factors that can facilitate seamless leadership transition outcomes.Design/methodology/approachThis study utilised a qualitative multiple-case study approach, with the population consisting of founders from three medium-sized family businesses in Nigeria. Semi-structured interviews were the primary data collection tool used in the study. Furthermore, company documents were analysed to gain further insights into the leadership transition strategies employed in the selected businesses.FindingsSuccessful transition and survival of family businesses are dependent on the founder's desire and support for transition, successor preparation, building trust and credibility in successors, and instilling a clear vision for the business.Research limitations/implicationsThe study's findings will provide valuable insights to leaders of family-owned SMEs, specifically in the development of effective leadership transition action plans. It should be noted that the study is limited to three family-owned businesses in two locations in Nigeria, which may restrict the generalisability of the findings. Despite this, the study offers novel contributions to the current literature by presenting practical strategies for achieving the survival of family businesses in an emerging economy.Originality/valueThis study proposed strategies for business survival, continuity, sustainability and seamless leadership transition for small and medium-sized family-owned businesses. Importantly, the study recommends action plans for present and prospective family business leaders to deepen succession pathways.

Family businesses are founded with a vision of long-term sustainability and longevity over generations. Therefore, succession in a family business is an important prerequisite for achieving this goal, representing one of the greatest challenges for contemporary family businesses. We are now in an era in which the millennial generation, which is known for their interest in innovation and technology, is among the potential successors. However, the relationship between family business innovation as a potential motivating factor and the next generation’s intention to take over the family business has not been sufficiently investigated. This study examines the relationship between family businesses’ innovativeness and potential successors’ intention to take over the family business. On a sample of 18,000 responses from university students in the role of a potential successor to a family business, we demonstrate a positive correlation between the intention to take over a family business and the innovativeness of that business. Although the Cramér’s V coefficient indicates weak association, it is evident that the relative number of potential successors of family businesses increases with a higher rating of innovativeness. We also show that this trend has not changed over the last five years. The innovativeness of the family business plays an important role in the next generation's decision whether to continue with the business and ensure the longevity of the family business over generations. Our findings may therefore be relevant for owners of family businesses in addressing potential succession issues.

Family businesses contribute significantly to the national economy, especially in the micro, small, and medium enterprise (MSME) sector. The sustainability of family businesses is largely determined by the succession process, namely the transfer of leadership from the founding generation to the next generation. This study was conducted to examine the influence of family background on succession in family businesses by considering family communication as a mediating variable among students majoring in Entrepreneurship at Universitas Muhammadiyah Gresik. The novelty of this study lies in the analysis of the role of family communication that mediates the relationship between family background and business succession in the context of the younger generation, especially students as potential successors to family businesses. This study was conducted using a quantitative method through a questionnaires. The research group consisted of students who came from business owning families, with a sample size of 66 respondents. Data collection was carried out through a questionnaire based on indicators of family background, family communication, and business succession, which was then analyzed using the Partial Least Squares (PLS) program. The results of the study prove that family background had a significantly influences family communication (T-statistic = 3,065) and business succession (T-statistic = 14,754). In addition, family communication also has a significant effect on business succession (T-statistic = 2,275), thus acting as an intermediary that strengthens the relationship between family background and readiness to face the succession process.

This paper presents an abstract of the final phase of an on-going research project aiming at investigating the antecedents and consequences of research and innovating within Lebanese small and medium-sized enterprises (SMEs). The role of training personnel and introducing supporting activities in moderating the relationship between R & D and introducing knowledge management systems within Lebanese small- medium –sized innovation in Lebanon still suffer from funding shortages, short of IT personnel training and lack of the ability to adequately use existing knowledge. Ashrafi, and Murtaza suggest that “Large organizations have enough resources to adopt ICT while on the other hand SMEs have limited financial and human resources to adopt ICT” (Ashrafi and Murtaza, 2008 P. 126). Even though, Lebanese government is trying to create a digital economy, Lebanon ranked 94th out of 144 countries on the Network Readiness Index in 2012 and “In the Arab world, Lebanon ranked in 10th position, right behind Morocco (89t...

Purpose This paper aims to explore and explain how predecessors (incumbents) of ethnic Chinese family small and medium-sized enterprises (SMEs) in Indonesia or appropriately called Chinese-Indonesian family SMEs nurture their successors in procuring transgenerational entrepreneurship. Design/methodology/approach A total of 25 participants were involved in this qualitative study which employed a multi-method triangulation design with the following research instruments: semi-structured in-depth interviews with experts, incumbents and successors of Chinese-Indonesian family SMEs, field notes from conversations and observations during engagement with participants affiliated to the family SMEs, a focus group discussion with academicians and literature reviews. Another key approach is source triangulation, where different participants – e.g. from among the experts, from among the incumbents, successors and family members in each family business case were interviewed and engaged outside the interview sessions. Findings The proposed theoretical framework depicts comprehensive attributes of nurturing Chinese-Indonesian successors to continue enterprising at the helm of family SMEs. Propositions are used to explain the impacts these attributes have on transgenerational entrepreneurship specifically. At the personal level, incumbents have to focus on discovering the successors’ passions and nurture them in formal education, childhood involvement, as well as bridging them in entrepreneurial knowledge through cultural values, mentorship, autonomy and role modelling. Incumbents also had to plan for their retirements to provide autonomy for successors. At the firm/family level, incumbents must be able to set a foothold on family governance, firm governance and ownership distribution to reduce conflicts in their family businesses. Furthermore, as a minority group with past traumatic experiences, Chinese-Indonesian family SMEs usually equip themselves with contingency plans to protect their assets for the long-term future. Research limitations/implications This study was conducted in Indonesia amongst Chinese-Indonesian family SMEs and thus it is not generalisable in other settings. Literature reviews on family SMEs succession are still scant, especially on the Chinese-Indonesian. Practical implications Predecessors/incumbents of Chinese-Indonesian family SMEs could consider implementing the proposed nurturing strategies to their successors to sustain the longevity of the business based on trust, stewardship and harmony. The theoretical research framework resulted from this study offers general suggestions on how to nurture the next generation specifically from personal/interpersonal perspectives, which must be accompanied by specific scopes of family and firm aspects. This study extends beyond indicating the factors (ingredients) by explaining how to nurture transgenerational entrepreneurship (cook the ingredients) in SMEs for a tactful transition. Hence, the incumbents play vital roles and must be poised to adjust their mindsets to certain aspects indicated in this study. Social implications Most overseas Chinese businesses are family-owned, and besides Indonesia constituting the largest Chinese population outside the Republic of China, this 3 per cent of Indonesia’s people are known for controlling about 70 per cent of the economy. Furthermore, SMEs play a significant role in the Indonesian economy, as they provide about 97 per cent off the country’s employment and 57.8 per cent of the gross domestic product. Hence, the longevity of Chinese-Indonesian family SMEs must be well managed to bolster the economy and social welfare of the country. Originality/value A transgenerational entrepreneurship model in the context of Chinese-Indonesian family SMEs which incorporates the nurturing process of the successor to step up the helm of the business is proposed in the study.

This study aimed to review and analyze corporate entrepreneurship (CE) within family businesses and small and medium enterprises (SMEs), providing a review of the current state of research and suggesting a future research agenda. In a systematic literature review, 1040 articles indexed in Scopus were initially subjected to bibliometric and qualitative analysis. Finally, 53 papers published in various academic journals, focusing on corporate entrepreneurship, family businesses, and SMEs, were subjected to bibliometric analysis and qualitative research to identify the new potential state of the art in corporate entrepreneurship. CE in family businesses and SMEs is not a general research trend in the entrepreneurial area. This research shows that the literature on CE models and tools in family businesses and SMEs is still sparse. The review results correlate the actors of CE, behavior, and activities, including entrepreneurial orientation, entrepreneurial management, and entrepreneurial leadership and performance, as outcomes in family business and SMEs.

  The aim of the present article is to find out differences and similarities in inter-firm cooperative relationships among family and non-family businesses, in order to contribute to an integrated theory on strategic alliances and family businesses within the small and medium-sized enterprises (SME) context. We found important divergences between both types of businesses, namely in the perceived difficulties and in performance evaluation. The results underpin the importance of trust when family businesses undertake cooperative relationships. An argument for cooperation between family businesses is made. We also present new research issues in family business and strategic alliance research.   Key words: Family businesses, small and medium-sized enterprises, cooperation, alliances, Portugal.

Most of the businesses in Rwanda are family owned and managed. These businesses fall in the category of Small and Medium-sized Enterprises (SMEs). They face a lot of challenges including in their initiation, management, and lifespan, leading to most of them collapsing leaving many people jobless. Given that this study is an exploratory research, it uses a combination approach composed of positivism. The study’s sample is 49,000 SMEs registered on the Rwanda Revenue Authority (RRA) portal in Nyarugenge district. However, the study targets the managers/owners of these businesses. It uses simple random sampling to select the respondents. It did the Chi-square test to test for the determinants of entrepreneurship sustainability among family businesses. The results show a significant association between training and mentorship in entrepreneurs involving family members in the management, good family relationships, financial discipline, education levels, innovations, and business sustainability. The results also show that there is no significant relationship between financial resources and a business’ sustainability and that although the educational levels are significant for a business’ sustainability, these do not contribute much to its sustainability. The key factors that determine a business’ sustainability are innovations, involvement of family members in the management, training and mentorship of entrepreneurs, good family relationships, and financial discipline.

PurposeBy investigating the use of formal compensation practices in family small- and medium-sized enterprises (SMEs), the purpose of this paper is to provide important new insights in these issues for academics, as well as family business practitioners, prospective applicants and financiers of family businesses. Moreover, this study includes a contingency that allows to explore heterogeneity across family businesses in their use of formal compensation practices: the CEO type.Design/methodology/approachA survey of 124 small- and medium-sized Belgian family businesses to explore the use of formal compensation practices is analyzed by the author.FindingsThe results support the hypothesis that family firms with a family CEO adopt significantly less formal compensation practices than their counterparts that are led by a non-family CEO.Research limitations/implicationsGeneralizing the findings of this study must be taken with care, as the findings are based on a cross-sectional sample of family SMEs in one country, Belgium. Future research can build on these findings with studies on larger samples in other countries.Practical implicationsThis study may be interesting for family business practitioners and consultants, as it provides insight in the actual use of formal compensation practices that are recommended as a best practice in numerous practitioner handbooks. Also, the results of this study might be important for prospective applicants and financiers, since the compensation system is an important communication device to signal legitimacy to external stakeholders.Originality/valueCompensation issues are among the main challenges SMEs, especially family firms, face. Despite the clear importance of this matter, academic interest has been rather limited. This paper therefore displays sound descriptive survey results and empirically investigates the determinants of the use of formal compensation practices in Belgian family SMEs by distinguishing between different types of family businesses.

This chapter explores the factors that influence the adoption of digital marketing among Malaysian family businesses Micro, Small, and Medium Enterprise (MSME) owned by female entrepreneurs during the pandemic. Entrepreneurship has been around for centuries, and it is a field that is still growing today, but it was mostly associated with men. Women have long been successful entrepreneurs, and this has been affirmed by both feminism’s rise in the nineteenth century and the availability of the Internet and technology in the twenty-first century. Due to the pandemic situation, it is critical to find alternative ways to sustain the business, and the adoption of digital marketing as part of the business continuity plan is highly recommended. This study employed quantitative methodology, involving 384 female entrepreneurs via simple random sampling. As a result, perceive cost, subjective norm, and perceive benefit all had a significant impact on the adaptation of digital marketing during a pandemic situation in family businesses Micro, Small, and Medium Enterprise (MSME) owned by female entrepreneurs. Furthermore, this study discovered that government support and business awareness generated by digital marketing were insignificant factors influencing the adoption of digital marketing among Malaysian family businesses MSME’s owned by female entrepreneurs.

PurposeThe purpose of this paper is to investigate whether small and medium‐sized family businesses in Ireland have the potential to be classified as learning organizations.Design/methodology/approachThe research methodology adopted for this study is that of multiple‐case studies. In this research, personal interviews were selected as the data collection method. On the basis of Eisenhardt's premise that a study of between four and ten cases is suitable for qualitative studies, a total of six owner‐managers of family small and medium‐sized enterprises (SMEs) were interviewed.FindingsThe findings of the case studies support the argument that family businesses have the potential to be learning organizations. However, the extent to which these family businesses are potentially learning organizations depends on the size of the family business and the structure imposed on the business. Micro family businesses struggle to be classified as learning organizations due to the lack of a learning orientation. These businesses lack systems for the monitoring of information and lack the ability to be reactive to market changes. Small family businesses have the potential to be classified as learning organizations. This is due to the fact that small family businesses have learning at the core of their business and systems in place to deal with a learning orientation. Medium‐sized family businesses also have the potential to be learning organizations, although they need to ensure that systems are in place to allow learning to occur.Originality/valueThis paper presents original findings in a highly relevant, but under‐researched field – the family SME as a learning organization.

This study highlights the influence of selected business family values on the success of small and medium-sized family businesses. Success, for the purpose of this study, is measured using two variables, namely Harmonious family relationships and Perceived future continuity. The primary objective of this study is twofold: firstly, to identify the potential influence of selected business family values on the success of family businesses and secondly, to make practical recommendations on actions that families in business can take to ensure harmonious family relationships and the future continuity of their family businesses. The target population of this study was small and medium-sized family businesses in South Africa, and a total of 931 individual questionnaires were returned from 173 family businesses. The data collected was subjected to various statistical analyses, including exploratory factor analysis, calculating Cronbach alpha coefficients, and multiple linear regression analysis. The findings of this study show that the more family members perceive fair treatment in the family business, the more harmonious family relationships and perceptions of business continuity will be. In addition, the perceived level of trust, commitment and effective communication has a positive influence on family harmony and business continuity. This study has added to the empirical body of family business research, and provides an important first step in gaining insights into selected family business values that influence the effective functioning of family businesses.

PurposeThis paper aims to explore corporate governance (CG) and succession planning in family-owned businesses in the United Arab Emirates (UAE).Design/methodology/approachSemi-structured interviews are conducted with 16 owners and heirs of UAE family businesses. The interviews – face-to-face and asynchronous electronic – are conducted instead of a questionnaire to get an in-depth analysis of the topic in the context of both medium- and large-sized family businesses.FindingsThe responses are mixed with regard to governance challenges (duality, gender, internal control, transparency, etc.). The majority of the interviewees indicate that succession planning remains one of the biggest challenges for family businesses in the UAE. Fifteen of the sixteen interviewees document that a sound succession strategy must be in place to ensure the continuity of the business and prevent future disputes among potential successors. Similarly, the respondents also emphasise the importance of transparency and accountability for the sustainability of family businesses. The sustainability of family businesses relies on many aspects, such as national regulations, corporate systems and the succession process. Finally, most of the respondents from medium-sized companies opined that incorporating CG is a time-consuming and expensive process.Practical implicationsThe interviewees supported stewardship theory in case family members are occupying positions on the board as they have more long-term commitment and a greater sense of belonging to the business (socio-emotional wealth) compared to non-family members. The interviewees acknowledge that the lack of professionalism and conflicts of interest among family members can be offset by recruiting non-family members.Originality/valueFamily businesses are particularly significant in the Arab world as they account for over 60% of gross domestic product (GDP) and use above 80% of the workforce which make them interesting research subject. In addition, this paper explores the CG challenges faced by both large- and medium-sized family businesses in the UAE within the theoretical framework of stewardship theory.

According to the Organization for Economic Cooperation and Development (OECD), small and medium enterprises (SMEs) account for more than 95% of generating huge new jobs. There are many factors that need to be considered so that SMEs can continue to run well. One of the factors that need to be considered by entrepreneurs is the growth and development of the business they will undertake. The purpose of this study was to investigate the effect of attitudes, subjective norms and self-confidence of entrepreneurs on the growth of business results. The sample to be taken for this research is SMEs located in South Tangerang. By convenience sampling, as many as 90 SMEs. The technique of collecting data is by distributing questionnaires to the owners of SMEs who are the research sample. In testing empirically the research model uses a partial least squares (PLS) path modeling approach. The results of the study show subjective beliefs and norms have no effect on the growth of operating results. Attitude has an influence on the growth of business results. Keywords: Attitude, Subjective Norm, Self-Confidence, Growth