Familiness, Interests, and Opportunities: Reframing the Landscape of Family Business Succession

Family businesses play a crucial role in the global economy, yet the complex process of family business succession remains a significant challenge. Scholarly attention on the survival and successful transition of family businesses across generations has been substantial, although a comprehensive understanding of this phenomenon remains an ongoing area of investigation. Through an iterative process involving literature review, interviews, and data analysis, we sought to uncover the underlying factors that influence the succession process (Babbie & Mouton, 2001; Yin, 2017). Contrary to a predetermined interplay, our approach involved an exploratory examination of multiple attributes. As the study progressed, we confirmed that Socioemotional Wealth (SEW) is shaped by the interplay of familiness and interests (Gómez-Mejía, Haynes, Núñez-Nickel, Jacobson, & Moyano-Fuentes, 2007; Swab, Sherlock, Markin, & Dibrell, 2020). The cornerstone of our findings is that a high level of SEW requires the alignment of both familiness and interest. However, a robust SEW does not guarantee a seamless succession, thus prompting us to consider the missing link, which we found to be the concept of opportunity (Eddleston, Kellermanns, & Collier, 2019; Shane & Venkataraman, 2000). Our second finding reveals that a successor’s decision to engage in succession is rooted in the harmonious coalescence of familiness, interest, and the prospect of business growth. Our empirical cases unveiled diverse scenarios where these factors interacted, thus guiding the formulation of the Familiness-Interests-Opportunities (FIO) model. Our study equips practitioners, particularly founders and succession consultants, to devise tailored succession strategies that cater to the nuanced attributes of potential successors and contextual business circumstances. We provide deeper insights into the interconnected roles of familiness, interest, and opportunity in shaping the trajectory of family businesses.