A study of business succession in Indian family businesses in South Africa.

Abstract

The aim of this study was to identify and understand the experiences of Indian family businesses in South Africa with regard to business succession. A descriptive research design was selected as it was deemed to be most appropriate method to answer the research question for this study. A positivist research philosophy was utilised to address the research objectives, and inferential statistics were used to answer the research questions. A quantitative approach was selected as it was the most appropriate research methodology that aligned to the research strategy. The data collected through an online survey of 51 businesses owned by persons of Indian origin. The study focessed on six areas that influence business succession: the Stage of the Family Business and Family Control, External Factors, Family Culture and Relationships, Family Conflicts, Readiness of Successor(s), and Identification of Successor(s). The key findings of the study highlighted that relationships exist between Stages of the Business and Family Control, Family Culture and Relationships, Family Conflicts, and Identification of Successor (Relationship) with the level of preparedness for business succession. Additional factors influencing the implementation of succession planning in South African Indian family businesses included: the relationship of readiness for business succession and the stage of the business (1st/ 2nd/ 3rd generation), the size of the business, the level of conflict in a business, value-driven businesses, key desired attributes in potential successors, areas of conflict and the readiness of a business for the exit of key member(s). The implications of this study for theory and practice highlights the significance of the process of business succession and encourages those who have not started this process, to realise this and begin paving the way for a successful and sustainable multi-generational business