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Family Business Succession in Austria - Satisfaction and the Incumbent-successor Relationship

2016; Corvinus University of Budapest; Volume: 47; Issue: 11 Linguagem: Inglês

10.14267/veztud.2016.11.04

0133-0179

Wolfgang Ziniel, Peter Voithofer,

Migration, Ethnicity, and Economy

The year 2006 marks an important date concerning family business succession.The history of the family company K. K. Kongō Gumi ended, after a lifecycle that had endured for 1428 years.The Takamatsu Construction Group took over the company from Masakazu Kongō.He was the 40 th and the last Kongō in the lead of the family business (Daspit et al., 2016).These numbers are certainly not representative of the actual situation in Austria or elsewhere, yet it is a fact that on average family companies are older and provide more stability than other companies in Austria (Doerflinger et al., 2013).There is a great need for research into the structure and characteristics of family companies in Austria as 9 out of 10 companies are run as family businesses 2 .71 % of the labour force in Austria and 68 % of the employees work in family companies.There are more than 260,000 family companies, more than 1.8 million labour force and nearly 1.6 million employees.61 % of revenues are generated in family businesses or, in other words, family companies generate revenues of nearly € 383,000 million per year. 3Nearly 60 % of the business transfers in the next 10 years are expected to happen in the context of family companies.These numbers make clear that failed business successions could have significant impacts on the Austrian economy.Failed successions are not always the result of weak business decision making.According to Hennerkes (2005, p. 58) conflict is the greatest destroyer of value in family enterprises.Satisfaction with a transfer can be analysed on two levels, the satisfaction with the process and on a personal level (i.e. the relationship to the incumbent and the activity in his/her role as successor).The perspectives of the successor, of the incumbent and of the employees have to be considered.All constructs are likely to be interrelated.The aim of this analysis is to reveal these correlations.It seems that subject-related literature has not devoted enough attention to these aspects so far.The issue of emotional factors in incumbent-successor relation-Wolfgang ZINIEL -Peter VOITHOFER FAMILY BUSINESS SUCCESSIONS IN AUSTRIA -SATISFACTION AND THE INCUMBENT-SUCCESSOR RELATIONSHIPThe transfer of businesses contributes to the dynamics and the development of the economy in Austria.Successful transfers generate numerous positive impacts.Securing both employment and investment, creating new jobs and stimulating growth are some of these effects.Failed transfers can contribute to negative effects, including the loss of jobs and an economic slowdown.Over recent years the number of business handovers in Austria has been rising.The forecasts show that this number will remain high over the next few years.Between 2015 and 2024 more than 42,000 economically sound SMEs will face the challenge of finding an appropriate successor.This means that 26 % of all Austrian SMEs (excluding one-person businesses) and 29 % of all employees in these companies will be affected.The aim of this paper is to provide a multi-faceted discussion of the relevance of affective components in family business transfers.A "good" relationship between the successor and the departing owner fosters the success of a transfer.This relationship involves, among others, the willingness to share relevant information, openness and respect.The satisfaction (with the completed business transfer) is closely interrelated with the relationship between the successor and the departing owner.Consequently, we can assume that affective and emotional components can indeed shape the success of business transfers.Based on that, new future research opportunities are outlined.