A typology of motives in family business succession planning: institutionalisation, implosion, imposition and individualisation

This paper examines the understanding of motives in the family business succession planning literature. It identifies two main motives on the part of incumbents for family business succession planning: family business continuity across generations and family harmony. Yet these motives are routinely conflated in the literature. This is at least partly because both motives are routinely undermined by individualistic self-interested behaviour, consistent with the model of homo economicus. The cross-tabulation of these motives produces a typology which suggests four distinct pathways in relation to succession planning: institutionalisation, implosion, imposition and individualisation. The two most obvious of these pathways are fully elucidated in the literature: specifically, the institutionalisation of succession planning, and family business implosion. The other two pathways are not so well understood. They include those circumstances where incumbents impose succession arrangements irrespective of family harmony, and those where family business succession planning involves liquidation of family business assets in order to divide assets between individual family members. The proposed typology highlights the repertoire of motives that inform family business succession planning, above and beyond homo economicus. It also suggests future lines of research, moving beyond the dichotomous pathways identified in the literature.