Succession Planning

Management succession in family firms is different from that in non family firms. First, the age and experiential gaps between the incumbent and successor are counted in decades rather than years. Second, the incumbent who retires and family candidates not selected to be the CEO can continue to have a long‐term influence on the business through their family membership and potential co‐ownership. Therefore, management succession planning in the family firm must also be different. This article highlights seven important issues that must be considered by the controlling family as part of the succession planning process if it is the family's intention to have a family member in the next generation take over the leadership of the business