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Investigating Appropriate Solutions for Transferring Family Business to Next Generations

Author Affiliations

  • 1 Department of Management, Institute of Management and Planning Studies, IRAN
  • 2 Department of Executive Master of Business Administration, Alborz, Qazvin, IRAN
  • 3 Dept. of Master of Business Administration, Science and Culture University, IRAN
  • 4 Dept. Entrepreneurship Management, Tehran University, IRAN

Res. J. Recent Sci., Volume 4, Issue (3), Pages 25-33, March,2 (2015)

Abstract

In today's growing world, family businesses have a great importance in economic growth and development, and creating employment. In a general definition, family business can be considered as an organization in which the main decisions and operational plans, especially management transmission and replacements, are directed and influenced by the members of one or a number of families. Despite the fact that the results of different studies show the high importance of family business in proceeding economic goals of countries, including Iran, unfortunately the success rate of such businesses is generally low. Hence, this study aims at investigating effective factors in a successful transmission of family business to next generations, considering the existing background and records. To this end, five factors were identified which are namely: harmonious activities of the present members of the family and the next generation, expert advisors, holding family meetings, preparation and choice of successor. For the purpose of investigating the above factors, family businesses located in ten industrial cities in the province of Alborz including 105 industrial units were considered as the statistical population. To access all the members, total count method was applied and data was gathered from the owners of these businesses by the use of the designed questionnaire. To check the validity of the questionnaire, content analysis method was applied and Cronbach's alphawas applied for checking the reliability of the questionnaire. The results indicated an acceptable validity and reliability for the questionnaire. To test the study hypotheses and checking if there is any relationship between the variables, Pearson Correlation test and Multiple Regressions were applied. The obtained results showed that there is a significant and positive relationship between the successful transmissions of the family business with all the factors under investigation, except the use of expert advisors.

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