Success Factor Priorities for the Succession of Family Firms
This research explored the opinion of incumbent CEOs of family businesses on the critical issue of the sustainability of a family business, succession. The incumbent CEO has the irreplaceable rights to make important decisions with regard to business succession. We used Analytic Hierarchy Process (AHP) methodology by dividing variables into two tiers. The first-tier has four categories 1) the relationship with a successor, 2) a successor’s management ability, 3) a successor’s self-efficacy, and 4) a succession plan. Each first-tier has three sub-dimensions which comprise the second-tier. The findings showed that the successors’ management ability was the most important factor, followed by the relationship with a successor, succession plan, and successors’ self-efficacy. In the second-tier the importance of successors’ interpersonal management ability is highlighted. Successors are expected to maintain good relationship with both family and non-family members. Implications for the successful succession of a family business are drawn.