An evaluation of succession planning in family business: a case study of Tholakonke group.

Abstract

Many family-owned businesses lack strategies regarding succession planning. Succession planning is a company's way of embracing the future. The majority of South African family-owned businesses do not survive to the second generation, and it is estimated that only 3% of family-owned businesses make it past a third generation. This descriptive case study explored strategies that leaders of a family-owned logistics and property development business use to prepare future generations to assume leadership roles in their company. The theory of family systems and the theory of organisational and business development were the conceptual frameworks for this study. In-depth interviews with purposively selected members of the small family-owned business were supplemented with a review of documentation from archival records. Yin’s 5-step analysis guided the coding process of participants’ response, capturing essential elements using the participants’ own language. Member checking was used to validate the transcribed data. The major themes of the study revealed the owners’ strategies relating to comprehensive business development and sustainment, examining the family systems, strengthening retention of all employees, examining organisational theory, planning for the future with contingency strategies, strengthening team building, training and support, and understanding leadership knowledge and leadership competency. This study may benefit small businesses by providing lessons learned on ensuring organisational sustainability. This study’s implications for social change include contributing to social stability and continuing economic growth within the South African context.