Ahmed Ghaith

Studies of family business succession are of particular interest in Europe as each year 690,000 businesses and 2.8 million jobs are affected by this phenomenon and the number is still growing. This study will review the business succession process in Austria where family business succession is predicted to be approximately one fifth of all companies and jobs in the decade between 2009 and 2018. The majority of these affected jobs are positioned within small-sized family businesses - which build the backbone of the Austrian economy - facing an external succession process from outside the firm. Regarding the succession survival rate, less than two thirds survive in the long-term. Looking at family businesses only 30% make it to the second generation. It can be said that successful business succession is of critical importance. And it is crucial to note that transferring ownership AND leadership at the top of the firm is a delicate task, which has and continues to gain a great deal of attention with scholars from all over the world. However, shareholders (owner-managers) tend to be the centre of the aforementioned scientific interest and other stakeholder groups, such as employees, are neglected. This study will identify gaps in knowledge, which will be filled through the production of a taxonomy of essences, theoretical propositions, and a model to demonstrate the employee’s role and satisfaction with the external succession process in small-sized Austrian family businesses. When using the term employee in the context of this study it is always a synonymous for non-family employee. In addition to the theoretical gaps in knowledge, practical management recommendations for incumbents and successors will be developed in order to increase awareness of the employee’s relevance for the effective succession process. Business succession in general has developed over time into a complex range of concepts with global scientific interest. Looking at the variety of existing process models, it can be concluded that the overwhelming majority concentrates on the owner-manager roles including incumbents, successors, and their family members. But there are many other stakeholder groups affecting or being affected by the phenomenon of a business succession process. An employee is such a stakeholder and by now there is no coherent body of knowledge about their role and satisfaction in the context of the external family business succession process. This study follows a continuous ‘qualitative’ research methodology. It starts from the inner foundation of the philosophical framework, which has subjectivist ontology, a phenomenological epistemology, and an inductive research approach in order to investigate the employee’s role and satisfaction in the succession process. The project’s research method strategy derived from the philosophical framework follows a four-step process, which includes a literature review, an initial set of interviews with business succession experts, single interviews with non-interrelated stakeholders, and a multiple-case study with interrelated stakeholders. The study’s main research outcomes are a taxonomy of essences identifying different themes and clusters, theoretical propositions including critical success factors influencing the employee satisfaction outcome and the effectiveness of the external business succession process, an employee satisfaction model, and practical management recommendations for affected incumbents and successors in order to increase awareness and understanding of the employee’s relevance for effectiveness. Therefore, to consider the role and satisfaction of the employee within succession planning is strongly recommended in order to increase effectiveness and survival of affected businesses in the long-term.