Intra-family Succession in the Family Firm: The Role of Incumbent Proactive Personality

Abstract

In this paper, the authors introduce a theoretical model that considers one of the most powerful actors in the succession process within a family firm, the family incumbent leader of the firm, and how that individual’s personality and behavior are likely to influence whether or not succession takes place. In particular, because change is inherent in the succession process, the authors chose to examine the proactive personality trait, which captures an individual’s orientation towards change. The authors offer propositions which argue that incumbents high in proactive personality are more likely to engage in constructive change-related behaviors which are frequently associated with situations in which intra-family transfer of leadership within a firm takes place. Many of the behaviors associated with cases of intra-family succession taking place in family firms are consistent with behaviors described as “proactive” in the organizational behavior literature. Thus, the authors employed both the family firm literature as well as studies in organizational behavior to provide insight into exactly how incumbents may foster or hinder the succession process. In addition, the authors’ model considers the moderating influence of incumbent characteristics (i.e., organizational tenure and age) as these are likely to influence whether or not an incumbent engages in constructive change-related behavior during the succession process and firm characteristics (i.e., firm performance, firm size, and stage of family firm) which may determine the extent to which an incumbent’s behavior influences whether or not succession will take place.