Implications of Company Succession on Resilience of Small and Medium Size Companies
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Sascha Frohwerk
Abstract
Small and medium-sized enterprises represent a significant economic factor. Their continued existence is often closely tied to the owner, as ownership and management are typically unified. As a result, the succession process plays a crucial role in ensuring long-term business continuity. To assess a company’s resilience, this article utilizes the Creditreform Rating creditworthiness index. An analysis of all successions supported by a guarantee bank in Germany over the past ten years identifies key factors that contribute to strengthening resilience. One notable finding is the particular relevance of the successor’s age, which – consistent with existing literature – is primarily associated with greater experience. To further explore this aspect, a survey was conducted among 200 successors, focusing on both existing and missing knowledge. While overall experience was rated positively, retrospective insights highlighted a desire for stronger competencies in management, personnel leadership, and legal fundamentals. These results offer valuable implications: they suggest how potential successors can enhance their preparation and how succession processes might be more effectively supported.
Abstract
Small and medium-sized enterprises represent a significant economic factor. Their continued existence is often closely tied to the owner, as ownership and management are typically unified. As a result, the succession process plays a crucial role in ensuring long-term business continuity. To assess a company’s resilience, this article utilizes the Creditreform Rating creditworthiness index. An analysis of all successions supported by a guarantee bank in Germany over the past ten years identifies key factors that contribute to strengthening resilience. One notable finding is the particular relevance of the successor’s age, which – consistent with existing literature – is primarily associated with greater experience. To further explore this aspect, a survey was conducted among 200 successors, focusing on both existing and missing knowledge. While overall experience was rated positively, retrospective insights highlighted a desire for stronger competencies in management, personnel leadership, and legal fundamentals. These results offer valuable implications: they suggest how potential successors can enhance their preparation and how succession processes might be more effectively supported.
Chapters in this book
- Frontmatter I
- Contents V
- Preface VII
- Strategy Development in the Light of Radical Change: A Perspective on the Evolution and Revolution of Family Businesses 1
- The Importance of VUCA and BANI in Developing Sustainable and Long-term Oriented Strategies in Family Businesses 27
- Employee Resilient Behavior and Its Leadership Prerequisites: Strategies for Founder Generation Family Firms 53
- The Impact of Family Ownership on SME Resilience: A Three-Circle Model Analysis 73
- Implications of Company Succession on Resilience of Small and Medium Size Companies 85
- Passing the Torch: Perceived Risks and Opportunities in Family Business Succession 103
- Convenience Study of Criminal Deviance in the Entrepreneurial Family Business: Husband as Lawyer and Wife as Accountant in the Law Firm 119
- The Adaptive Capacity of Tourism Family Firms – An Owners’ Perspective on Risk Resilience 147
- Corporate Social Responsibility during the COVID-19 Pandemic: Learnings from Austrian Family Businesses 169
- Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View 183
- The Impact of AI-Induced Downsizing on Family Businesses 201
- List of Contributors
- Index
Chapters in this book
- Frontmatter I
- Contents V
- Preface VII
- Strategy Development in the Light of Radical Change: A Perspective on the Evolution and Revolution of Family Businesses 1
- The Importance of VUCA and BANI in Developing Sustainable and Long-term Oriented Strategies in Family Businesses 27
- Employee Resilient Behavior and Its Leadership Prerequisites: Strategies for Founder Generation Family Firms 53
- The Impact of Family Ownership on SME Resilience: A Three-Circle Model Analysis 73
- Implications of Company Succession on Resilience of Small and Medium Size Companies 85
- Passing the Torch: Perceived Risks and Opportunities in Family Business Succession 103
- Convenience Study of Criminal Deviance in the Entrepreneurial Family Business: Husband as Lawyer and Wife as Accountant in the Law Firm 119
- The Adaptive Capacity of Tourism Family Firms – An Owners’ Perspective on Risk Resilience 147
- Corporate Social Responsibility during the COVID-19 Pandemic: Learnings from Austrian Family Businesses 169
- Resilience beyond Metrics: How Hidden Resources in Small Family Firms Challenge the Resource-Based View 183
- The Impact of AI-Induced Downsizing on Family Businesses 201
- List of Contributors
- Index
