Challenges in family business succession: the father-daughter transmission
Within the field of family businesses, there is little studies on female succession. However, it deserves to be studied since these women often face obstacles in family businesses simply because of their gender. There are some disparities between males and females concerning the transmission of family businesses. Women are actually essential elements in family businesses. Female management helps create a positive atmosphere in the workplace and thereby improves employee’s morale (Vadnjal & Zupan, 2009).
Driven by my future ambition to acquire my father's business, I decided to write my bachelor thesis on this topic to understand the challenges I might have to face if I ever decide to take the plunge.
Interviews of French female owners who took over the family business from their father were conducted. Their narratives were analyzed to come to some important challenges that they had faced during the succession process. These challenges can have some serious consequences on the father-daughter relationship. For more clarification, a distinction was made between challenges specific to the father-daughter succession et common challenges for any parent-child succession.
Common challenges for any parent-child succession
The father's unwillingness to cede control is seen as one of the main problems during the succession process. This might be even more intensified if the owner is also the founder. The business is very often considered as the father's baby, it is where he gets his energy and interest. It is even more difficult to relinquish control when the father has powerful connections with the company, such as financial dependence, or when he does not have interests outside the firm.
The father sometimes feels left out when the child takes over the business, since he does not control the firm anymore. Surprisingly this is more likely to happen in a father-son succession. Some evidence indicates that the need for power and control of a son may cause succession to occur too quickly, which does not enable the father to follow his own speed of relinquishing control (Rosenblatt, de Mik, Anderson & Johnson, 1985). However, it also happened to one of my interviewees and it was not because of the speed of the succession since this daughter was in the business for 20 years before succeeding her father.
The successor can also encounter challenges when it comes to the family members. Siblings can experience rivalry or jealousy because of the closeness the daughter might enjoy with the father since the succession. The daughter indeed gets closer to the father when taking over a business, they work together, creating bonds that other siblings do not have the chance to experience.
Additionally, the father-child relationship can be impacted by the difficulty to communicate. It is often tricky for the child to know how to communicate with the father. Should she/he communicate with him like a father or like a boss?
Challenges specific to the father-daughter succession
Non-family member employees can also be a challenge for successors when they refuse to accept the son or daughter as their new boss. Employees often see the arrival of the new boss as a threat of changement in the organization. If the new boss is a female she encounters more resistance. Especially in male-dominated companies, the daughter is often seen as not viable, weak and untrustworthy. However, I found that daughter’s previous work experience outside the family business and then inside the family firm as an employee may help the employees trust her and increase her credibility in the firm.
Additionally, balancing private and professional life when taking over a business is also challenging. The difference between a father-son and a father-daughter succession is that men often organize their private lives according to their jobs, compared to women, who seek a flexible private and professional life. When there are problems at work, going home does not prevent the daughter from continuing to think about these problems. Becoming a boss also means a lot of working hours in the business and these are at the expense of the family time.
Lastly, not being seen as a viable successor is also a big challenge the daughter might have to overcome. The daughter might have to work harder than men to prove her abilities. Gender stereotypes also do not help her case. Entrepreneurs have stereotypically masculine features, making it difficult to be seen as a viable successor. It obligates the daughters to work harder to disprove the stereotypes and change people’s mentality.
Written by Anna Polo
Bibliography:
- Rosenblatt, P. C., de Mik, L., Anderson, R. M., & Johnson, P. A. (1985). The family in business: Understanding and dealing with the challenges entrepreneurial families face. San Francisco, CA: Jossey-Bass.
- Vadnjal, J. et Zupan, B. (2009). The role of women in family business. Economic and Business Review, vol. 11, n°2, p. 159-177.
