SUCCESSION PLANNING FOR A THIRD GENERATION FAMILY BUSINESS

Abstract

This study investigates the impact of succession planning practices on the performance of third-generation family businesses. The research addresses critical gaps in understanding how different succession strategies—formal plans, in-house training, mentoring, and external consulting—affect business outcomes. Utilizing a cross-sectional survey of 455 participants across various family businesses, the study employs quantitative methods to analyze the relationship between succession planning practices and business performance metrics, including revenue growth and stability. Major findings reveal that formal succession plans are positively associated with improved business performance. Additionally, in-house training and mentoring programs are found to be particularly effective, while the impact of external consultants varies. The study concludes that an integrated approach, combining formal plans with training and mentoring, enhances business success. These findings underscore the importance of comprehensive succession planning strategies in ensuring long-term business continuity and stability in third-generation family enterprises