Succession and conflict resolution
Succession: The critical issue
Transitioning a family business from one generation to the next can be a challenging time.
The passing on of a business can augur a time of reinvention, renewal and strength… or one of destructive imbalances, especially if the succeeding family members lack the skills to take the business on -- or if, as is often the case, there are unresolved conflicts that could upset the stability of the on-going enterprise.
Fortunately, 8 in 10 respondents told us that they have at least one conflict procedure or mechanism in place, and a quarter have already made provisions for a third-party mediator.
The very essence of a family firm -- its strength as well as its potential vulnerability -- is that the business is in some way embedded in the family structure. This year’s survey underscores that the way the family handles the moment of transition – and the years leading up to it – can make or break the firm’s future success.
Own, manage, float or sell?
Significantly, although just over 40 per cent of family businesses told us they intend to pass ownership and management to the next generation, more than half of those were unsure whether the next generation would have the requisite skills (or enthusiasm) to do this successfully.
Others were more than unsure. Fully one quarter (25 per cent) intend to pass on their shares but bring in professional managers, citing the next generation’s lack of skills as the main reason. Another 17 per cent have decided they will sell, or float, their family business outright when the time comes.
Overall our survey revealed strong trends among family businesses around the world -- some of which underscore their fundamental similarities in the face of this critical issue, and some of which reflect larger regional and cultural differences.
Dive into the details
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Helping you to understand how you compare
How do your challenges, strengths and resilience compare to those of your peers across the world? We've got the qualitative and quantitative data from our large-scale survey of 1,952 family businesses across over 30 countries. We've used this knowledge to create a benchmarking tool that will not only help you see where you are, relative to your peers, but help you set a strategic course for where you want to go. Benchmark your company
What family businesses told us
- Eric Andrew
- Global Network Middle Market Leader
- Tel: +1 604 806 7500
- Oriana Pound
- Global Middle Market Director
- Tel: +44 (0)20 7804 8611
- Jillian Murphy
- Global Family Business Survey Project Manager
- Tel: +44 (0)20 7804 0774
Download
Family Business Survey 2012: Family firm: A resilient model for the 21st century
Learn more about the qualities that make family business unique, the current and future challenges they face and what they believe they need to do to compete in an increasingly global market place.
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Scale, skills and succession: Tackling the tipping points for family firms
How are companies like yours preparing to become more international? How are they recruiting and retaining the right talent? How are they preparing the business to hand over to the next generation?