Back to the nest: the practices employed for succession of heirs in family businesses in Brazil

Abstract

Purpose

The present study aims to identify the practices employed to bring heirs into family businesses as successors.

Design/methodology/approach

We conducted an exploratory, qualitative investigation using a case study approach. Semi-structured face-to-face interviews were conducted with external consultants and with incumbent leaders, next-generation heirs working in the firm (and likely to become successors) and employees from three family firms from different industries and under ownership and control of different generations of their respective families (first, second and third and fourth generations). In addition to surveying their general perceptions of the succession processes in their firms, each informant was asked to rate the degree of importance of 12 succession practices identified in the literature and the extent to which they exist in their respective firms.

Findings

Our results showed that heirs typically enter the family business after a development process outside of the family business, which we have termed as coming back to the nest. This process was enacted through practices that we allocated to the following categories: continued development of heirs, developing relationships in the succession process, separation of roles and attitude of the successor heirs. Overall, 8 of the 12 practices derived from the theoretical framework were endorsed as important by representatives of the family businesses and 9 were endorsed by the consultants, 7 of which coincided in both groups. However, only 5 of the practices were identified as present in the firms’ succession processes by the representatives of the family businesses, while the consultants did not identify any of the 12 practices as present.

Originality/value

We present additional important practices, the adoption of which would be beneficial for family business succession, such as adapting external learning to the family business, acquiring leadership skills and experience and developing emotional intelligence. Our study advances the prior literature since we do not merely discuss succession planning but analyze in an applied manner how succession actually takes place in family businesses.

Citation

Monticelli, J.M., Bernardon, R.A., Schaidhauer, P.H. and Curth, M. (2024), "Back to the nest: the practices employed for succession of heirs in family businesses in Brazil", Journal of Family Business Management, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JFBM-05-2024-0104