Succession Planning: Perceptions of South African Family-Owned Small Enterprises

ABSTRACTThis research investigated the perceptions of family-owned small enterprises on the reasons of the absence of written succession plans, and the implications of the proposed successful succession framework. Quantitative research was used, and the study is descriptive and explanatory in nature. Family-owned small enterprises based in the Gauteng province of South Africa were the population of this study. The unit of analysis was thus the owners/founders and managers of the enterprises. A total of 257 valid questionnaires were returned from the sampled 384 family-owned small businesses, yielding a response rate of 66%. The results showed that family-owned small enterprises appreciate the importance of succession planning, however, they do not regard it as an urgent undertaking. They believe that succession planning is only about successor selection. The results also divulged that the lack of written succession plans is influenced by several reasons, namely, the entrepreneur never thought of succession planning, family members are not interested in taking over the business, the business is still small, and the children are still young. In response to the findings, the research proposes a successful succession planning framework and its implications to assist small family-owned enterprises to plan for succession.KEYWORDS: Family enterprisessuccession planningfamily-owned businessessuccession frameworkownership transfer Disclosure statementNo potential conflict of interest was reported by the author(s).