Leadership Succession in an Indian Family Business Context
Project Focus
Family businesses are becoming more common as they are being considered ideal in creating employment for the family members in a highly competitive workforce environment (Rothausen, 2009), where employability is becoming a common concern even for the university graduates (Dacre Pool and Sewell, 2007). Especially in reference to India, with a population of over 1.25 billion people (Mundkur, 2011), family businesses are becoming more commonplace in securing the wealth of the family over the generations. While these ventures strive to create wealth for the family members, a key area for concern is their leadership succession. This is because research points out that only 33% of family-owned businesses successfully transit from the first generation (founders) to the second generation (successors) (Ibrahim et al., 2001). Therefore, the proposed study is an analysis of leadership succession in an Indian family business context to deduce the challenges the businesses experience and profile the entrepreneurial benefits of a successful transition as well. (All the businesses are based in India.) As “a person who does not worry about the future will shortly have worries about the present” (Ancient Chinese Proverb)
Justification of Research
Most of the previous studies into the topic of family businesses are too general. They touch on topics such as governance and management, objectives, interactions and relations with human resources, and only a few of them have focused on leadership succession in family-owned businesses. Even for the studies covering leadership succession, they are too general as their focus is worldwide. Therefore, the studies are lacking a specific context that can help to understand cultural, regional, and cross-border differences in leadership succession of family businesses. Considering that many large-scale family businesses are mushrooming in India, such as