Evaluating the Influence of Succession Planning on the Growth of Small and Medium Enterprises (SMEs) in Ahafo, Bono and Bono East Regions of Ghana

Abstract

Small and medium businesses (SMEs) are critical to any country’s national economic development. On the other hand, SMEs confront a considerable difficulty in succession planning: the lack of or inefficiency/ineffectiveness of succession planning. As a result, this quantitative correlational study aimed to evaluate the influence of succession planning on the growth of Small and Medium Enterprises (SMEs) in the Brong Ahafo region of Ghana. To reach the research goal, the study used a quantitative correlational research design. Data were collected from 140 respondents involved in SMEs from nine districts and municipal assemblies from the Bono, Ahafo and Bono East Regions of Ghana. The results revealed that most of the respondents, 113 (80.64%), agreed that employees or possible successors might leave the organisation for a better offer and 106 (75.71%) respondents indicated that owners of SMEs do not think about succession plan until there is a crisis. The results also showed that succession plan explains nearly (50%); thus, half the chances of survival of an SME in the Bono, Ahafo and Bono East regions are dependent on succession planning. There was a significant difference in succession plan practices among the different year groups of SMEs. The result also demonstrated no statistically significant difference in the service and manufacturing industries’ succession planning practices among the SMEs surveyed. It is recommended that business owners, policymakers and the state should support SMEs in succession planning development. If possible, succession planning should be part of the school curriculum and entrepreneurship training programmes in schools and business institutes. This will build the capacity of prospective business owners and create awareness about the effects of succession planning on the growth of organisations.