In it for the long haul?: succession planning within small entrepreneurial firms.
Entrepreneurial Executive › Nbr. 10, January 2005
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In it for the long haul?: succession planning within small entrepreneurial firms.
ABSTRACT
Small businesses, whether family-owned or not, need to plan for the eventual turnover of key contributors, especially owners/founders. Those firms that have not implemented or communicated a formal succession plan may not have qualified people to lead them in the future. A study was conducted among small manufacturing firms to explore succession planning practices. Only 40% of the firms studied engaged in formal succession planning. Key determinants of succession planning were top-management support of the initiative and having someone who possesses the knowledge to adequately implement succession planning. For those firms that had a formal succession plan, what determined whether or not they kept it a secret from employees was whether they believed the employees included in the plan would feel a sense of entitlement to the promotion. The results are discussed and recommendations are made for the small business owner/consultant. INTRODUCTION It has been reported that no more than three out of every ten small businesses survive past one generation of leaders, and only 16% survive to the third generation (Janjuha-Ji...See the full content of this document
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