Understanding the influence of culture on succession planning in South African Muslim-owned family businesses
Year: 2013
Type: dissertation
Abstract: The significance of the family firm in the South African economic environment is\ngrowing each year. This increasing relevance is owing to growth experienced by family\nbusinesses in South Africa. Family businesses are found to provide jobs to a large\nunskilled population in South Africa, and in turn contribute to the stability and growth in\nthe communities in which they operate. However, family firms experience a 70% failure\nrate in their second generation of operation and an 88% failure rate in their third\n(Downes, 2011). It is found that one of the major issues in the failure rates of\nsubsequent generations of family businesses is due to the inability of family businesses\nto manage the dynamics that influence the succession planning process.\nThe aim of this study is to provide insight into the family business’s characteristics,\ndynamics and practices, primarily those characteristics that govern cross-generational\nownership. According to Adendorff and Boshoff (2011), Gupta and Levenburg (2010),\nPapalexandris and Panayotopoulou (2004) and Taruwinga (2011), the organisational\nculture is amongst the most important dynamics that influence succession planning.\nThis study therefore focuses on understanding the influence of culture on the\nsuccession planning process of family businesses. Eight South African Muslim-owned\nfamily businesses have been selected as the sample for the current study and\ntherefore provide a unique insight into the influence of culture on succession planning\nin family businesses of religious commonality. A Rapid Ethnographic research\nmethodology was adopted to provide insight into the cultural elements of the\nbusinesses.\nCultural elements were found to influence the planning for the handover, the selection\nprocess of the successor, the training and development of the successor, the handover\nprocess and the management stage of the businesses. The study found that certain\ncultural aspects were influenced by religious practices and sentiments stemming from\nthe Islamic belief system. These cultural aspects were found to be the most influential\ncultural elements in the succession planning process of South African Muslim-owned\nfamily businesses. This study therefore implicitly provides insight into the strong\ninfluence that religion has on organisational culture and ultimately on succession\nplanning of family businesses.
Author: Ziyaad Jina
Language: English
Domain: Social Sciences
Open Access status: green
OpenAlex ID: W130088315