Family Business Succession Planning

1.1 Introduction

the purpose of this phenomenological evocative mixed method is to reveal the challenges that are faced by Kuwaiti family businesses. The research seeks to give an explanation of how Kuwaiti is affected by internal factors such as lack of Business Planning, women enhancement in the succession planning process, Government effect on policies of family business succession and how insufficiency in management affects Family businesses succession. The research also explains the influences that the demographic factors such as, intrusive (achievement, recognition, advancement, responsibility, and patient mix) and extrusive (salary, supervision, organization policy and administration, working conditions, and involvement in research) factors have on the succession of the family businesses. Various tools are used in order to determine how the factors influence the succession of family businesses.

1.2 Problem Statement

For the achievement of the objectives goals of the study, both quantitative and qualitative approaches are used. In order to determine the succession of the business and how it is related to the factors such as ages, salary, supervision, administration, the qualitative method is used. It helps us to find out how the employees ages are related to the succession of the business. Later the quantitative inquiry is used. The quantitative enquiry aids in the determination of how various factors are related to the succession of family businesses. In quantitative analysis the factors such as demographic, intrusive, extrusive factors that affect the workers of family businesses are determined and how they are related to the succession of the businesses. The design of the research that was used is descriptive. The basic reason for the study is to find out “relations”. The following needed to be found out;

The relations that exists between the succession of the family businesses and the salaries of the workers in the organization.

The effects of extrinsic factors on the level of businesses succession in the family businesses.

Hoe both the intrinsic and extrinsic factors determine businesses succession and how they are related to the demographic variables that are identified in the list above.

Administrative effects on the level of businesses succession.

. 3.4 Methodological Framework

The purpose of my study is to establish the nature of family business succession in Kuwait. It seeks to answer the question on why business succession may or may not fail in Kuwait I have sought to identify factors that limit smooth and successful family business succession. In order to adequately address the question collection of data would consists of primary methods particularly a questionnaire.

This entails sampling, data collection procedures and sampling and rationale.

Part one; A letter should be used in the explanation of the intention of the study. The letter clarifies the objectives of the study and its purposes. It also gives a clarification of time that the interview should take (approximated duration). It is through the letter that the respondents are assured that the information that they provide will only be used on the purposes of the study (confidentiality). They are further affirmed to that they are free to give that data or not. Refusal to give the information will not have any side effect in the future. They should do it at their own will but not at the interviewers. For the qualitative part, twenty mangers and twenty employees from family businesses are sampled randomly and given interviews. The interview should be one to one and not through phone or any other electronic. The selected group is interviewed on the succession of the family businesses. The interview finds out how factors like, salary, supervision, administration; organization policy influences the succession of the family businesses.

Part two: Part two involves quantitative analysis. A Likert scale survey (questioner) is to be distributed to three or four major departments in the family businesses. the questioner entails the information that is aimed at achieving how the Family business succession is related to demographic factors, intrinsic and extrinsic factors, administrative influences on the successions of the businesses. The intention is to send to more than 800 respondents. All the responses to the factors that determine the succession of the family business will be recorded on the will be given a response on the 7-point Likert scale. The responses to the succession of the business on the 5- point Likert scale. After the completion of the collection of all data, the total scores are obtained by getting the average across the items. Here factors like, demographic, intrinsic, extrinsic are taken to be independent. This succession of the Family business is hence dependent variable.

Dependent variable will be measured by the Minnesota Satisfaction Questionnaire formulated by Weiss et al (1967) with an approximate Cronbach’s alpha of 0.91. The independent variable measured using the elements that were designed in the questioner that was used in the process of data collection.

To be accessible to the managerial skills in the businesses, 20 participants will be asked to respond to the questions involves descriptive rudiments of leadership behavior as built up by Bass and Avolio (1992). The multifactor Leadership Questioner (MLQ) (1992) by Bass and Avolio will provide a good basis and guidance for the purposes of measurements and assessments of the of the interviewers perspicacity of various factor that resolve the succession of the family businesses.

A sample strategy will be used in identification of the people to be interviewed. The main aim of the study is to find ou5t how the factors are related to the succession of the family businesses, twenty employees and another twenty employers are selected for the interview (Mishler 2004).

The size of the interviewers is large and so a large quantity of data is expected. The data should therefore be collected in a very short period of time and should be detailed to enhance the accuracy and for the better relation comparison levels.

1.3 Research Objective

The objective of my research was to determine how business succession planning in Kuwaiti is affected by:

insufficient management;

demographic factors ((gender, age, social class, level of education, family);

intrinsic and extrinsic factors

lack of business planning;

the role of women in the succession planning process; and

the effects of government policies on family business succession.

The section that follows is a sample questionnaire that as an interviewer used in carrying out the research.. The questionnaire is divided into four different sections each section catering for each objectives. All the questions in the questionnaires are directed to the owners of the businesses.

Sample Questionnaire;

Questions are to ask effectively in order to achieve the questions objectives. This also increases the efficiency and accuracy of data obtained.

Section 1: business management

How do you usually mange you businesses?

What is the level of their education and experience in business world?

What is the proportion of you share in this business?

Section 2: business planning

What strategies have you placed for the succession of the business?

In the current moment do those in charge of planning analyze the economic situation when doing their planning?

Are the policies made by the policy makers (planners) ever implemented?

Does the planning process involve the business maintenance budget?

Section 3: the role of women in the business succession planning

Do women have any role in the business succession plan and to wht percentage

What according to your opinion should be the role of women in succession planning?

In your known case will, if you have started planning for your business succession plan do you involve your wife and daughters in this plan?

If you have not started planning for the succession; will involve your wife and daughters?

Section 4: the effects of government policies on business succession

What are government policies in place are concerned with business succession?

What are the effects of these policies to the issue of business succession?

Government policies change with time; what is your take on changes that have been put in place concerning the issue of business succession.

2.1 Major research questions

The questions of this study will be:

Do government policies affect family business succession?

What is the impact of insufficient fund on the success process?

Does preventing women fro the process affect succession?

Does lack of succession plan affect the process?

Hypotheses

Government is ignorant of the succession plan.

Many family businesses fail because they lack succession plan.

Women have been denied the chance to participate in family businesses

Many family business struggle due to lack of funds.

Variables

Dependent variable is the success of succession process.

Independent variables include funds, women participation, government policies and succession planning.

Assumptions and limitations

Almost all researches or studies make assumptions (Robert, 50). Sample represents the whole population under consideration. Another common assumption is that the instrument used in data collection has validity and is measuring the required variables; i.e. the questionnaire that I will administer will be able to get the necessary information. Still researchers assume that respondents will cooperate and answer the questions of the survey with truth and honest. Therefore it’s important that researchers state the assumptions made.

Due to the great number, the size of data is to be limited and hence a shortfall in the research.

There may be failure of respondents to cooperate or give false information.

All items are assumed to be consistent with the characteristics of normal distribution.

3 RESEARCH DESIGN

Experimental research design would do because I intend to carry out repeated measure on factors affecting family business succession. Although lack of cooperation by the subjects sometimes prevent experiment from being performed, I consider experiment as the best approach because in experimental study one does more than just observing the objects.

3.1 Target population and sampling method

The population in this study is defined as all businesses held by families during the sampling time frame. There are numerous sample methods from which to choose from. To select the sample I would use random selection procedure since it is considered by many researchers as the safest way to ensure that the sample is representative (David, 34). In selecting the sample I will; first identify the population and then narrow down to a specific region particularly the one width high concentration of family owned businesses. Secondly after identify the region to use, them using the random sampling method I will select the sample from which I will issue the questionnaires to collect data.

Obvious the whole country represent the survey population and it would not be easy to conduct survey across the whole country (Graeme, 3). Therefore I would work with a sample of subjects rather the whole population and then generalize. In choosing the sample I would ensure that, the sample is a representative of the population. The number in the sample is very important since the effect of changing the number of the sample reduces or increases the sampling error. When sample is not representative of the population, there is possibility of selection bias. Thus in avoiding bias, the proportion of the people selected as subjects should show high compliance. The key point is; the sample must be large enough to assure that I am likely to get most or all the data that might be important. The research study is expected to take three months (July to December) such that a get enough information and reach many people as possible.

4 DATA ANALYSIS

All categorical items will be changed to an ordinary scale that rangers from the minimum value (i.e. don’t agree at all).to maximum value (i.e. fully agree). The questioners tat did not get an6y response will be coded as omitted values and the scale values calculated as average of the single item. Qualitative technique will be used to handle quantitative data. For example, the segments will be demarcated within the qualitative data and then coded. The highly-structured data will be coded without any further subjection to segmentation. This makes such data analyzable using both qualitative and quantitative techniques (Denzin and Lincoln 2000). The zero order, the multiple, partial, and the interaction association coefficients will be calculated for the qualitative data. Cross-classification technique proposed by Denzin and Lincoln (2000)be will be used, in which the dependent variable ( businesses succession ) is cross-classified with the independent variables so that the ultimate partitioning of the variation in the dependent variable is achieved just as it would be for a regression analysis in a quantitative data. This method is appropriate since the data to be collected is multivariate and hence can be cross-classified.

Descriptive statistics and Analysis of Variance (ANOVA) will be performed to evaluate whether there is significant relationship between business succession and the various quantitative variables like the demographic factors. The relationship between the various variables will be measured through the Pearson product-moment correlation coefficients (Grinnell & Unrau 2007).

Hierarchical regression analysis will be applied to investigate the degree, to which business succession is subject to business needs. The variables will be arranged in different hierarchical steps. The first step will entail assessment of the background variables such as; intrinsic and extrinsic factors, and demographic factors.

In the second step, management will be evaluated to establish their relationship with business succession. In this step management will be assessed to establish how they relate to business succession. Job demands like the quantitative demands and emotional demands will also be assessed while another step will entail an evaluation of the job resources for instance social support at workplace and leadership.

All the p-values will be two-tailed. P-values of less than 0.05 will be considered significant given that the significance level will be 0.05 or 5%. The values will be given as mean and standard deviation and the data will be calculated using SPSS Version 17. From the research study it is evidenced that there is correlation between family business succession and funds, women participation in the business, government policies, and succession planning.

Works cited

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Nigel Finch. Identifying and Addressing the Causes of Conflict in Family Business University of Sydney – Faculty of Economics and Business pp 45-56 2005

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