Abstract
The literature generally indicates that succession in family businesses takes the form of transfer from one generation to another, but succession planning appears to be left to chance by many firms. This neglect of succession planning and the emotions generated by the process make owners ill-prepared for succession. The objective of this study was to explore the factors that influence succession planning in family-owned businesses and their importance in ensuring the continuity and prosperity of businesses in the Wa Municipality, Ghana. A random sample of 205 out of 440 family businesses was systematically drawn, and an interview schedule was used to collect data which were analysed using descriptive and inferential statistics. The findings indicate that higher level of education of founders and communication of the succession decision, comprising the transfer date, and post-succession roles to all key stakeholders affect the succession process and the success of the transfer. When the founder's level of education is relatively high, there is the likelihood of succession planning in the business, but trust seems to be limited with respect to female owners. It is therefore recommended that family-owned businesses in the municipality should be encouraged by supervisory or oversight agencies like the registrar general or National Board for Small Scale Industries to improve their educational level, build trust, and set dates for transfer of responsibilities, specify post-succession roles of incumbents and communicate the succession decision to all key stakeholders in order to improve the succession process and ensure the continuity of the businesses.
Highlights
Micro and small-scale rural and urban enterprises are major areas of importance to many policy makers in an attempt to accelerate the rate of growth in low income countries
MSMEs and informal enterprises, account for over 60% of GDP and over 70% of total employment in low-income countries, while they contribute over 95% of total employment and about 70% of GDP in middle-income countries
Was the appointment of a family member and the least It can be concluded that highly educated business preferred (3.0%) option was liquidation of the business owners are likely to write down their succession plans as (Table 5)
Summary
Micro and small-scale rural and urban enterprises are major areas of importance to many policy makers in an attempt to accelerate the rate of growth in low income countries. These enterprises have been recognised as the engines through which the growth objectives of developing countries can be achieved. They are potential sources of employment and income in many developing countries. Empirical studies show that MSMEs contribute to over 55% of GDP and over 65% of total employment in high-income countries. Important contribution is on exports and on productivity growth [54]
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