We interviewed family business owners/managers and their successors in 20 family firms coming from different industries from production of carpentry, textile clothing, faucets, concrete products, jewellery, sport equipment, toys, pellet stoves, car batteries from the wholesale and retail trade of cars, textiles, carpentry, organic food, sanitary equipment, transport and logistics, and other car services (Table 6.1). The sample of companies was regionally dispersed as there were 6 (30%) companies from the Podravje region, 5 (25%) from the Osrednjeslovenska region, 2 (10%) from the Gorenjska region, 2 (10%) from the Savinjska region, 2 (10%) from the Notranjska (Carst) region, 1 (5%) from the Prekmurje region, 1 (5%) from the Primorska region, and 1 (5%) from South-East Slovenia (Dolenjska region). There were 7 (35%) medium-sized companies, 8 (40%) small companies, and 5 (25%) micro companies included in the sample. All founders (100%) were active in their companies. Ownership and management had been totally transferred to the successors in 3 (15%) companies, partly transferred to the successors in 2 companies (10%), and partly (ownership) and entirely (management) transferred in 3 (15%) of the companies; in 7 (35%) of the companies, ownership and management had not been transferred to the successors, 4 (20%) founders transferred management but not ownership to their successors, and 1 (5%) partly transferred ownership but not management to the successor.
|
Case no. |
Industry |
Established (year)/current generation |
Short description of company specifics |
|---|---|---|---|
|
1 |
Production of carpentry from wood, plastic, aluminium |
1990/second |
A leading producer of carpentry from plastic, aluminium, and recently from wood, awarded with golden medals for their wooden and wooden-alu pasiv windows; the founders retired, present in the supervisory board and procuration, management transferred to the son-in-law and daughters, ownership transferred partly to daughters. Medium-sized company. Podravje region. |
|
2 |
Road transport and logistics |
1992/first |
A road transport and services provider. The founders have transferred management, but not ownership to the successors. One is retired, but is active. Medium-sized company. Gorenjska region. |
|
3 |
Production of sport equipment |
1987/second |
A micro company developing sports equipment, holding patents, producing short skis and accessories for skis; founder just retired, has been actively present, but ownership and management are being transferred to the successor. Gorenjska region. |
|
4 |
Wholesale trade and production of toys |
1991/first |
A small company importing toys and developing and producing games for children. Management and ownership in hands of the founders. Successors are active in the company. Notranjska – Carst region. |
|
5 |
Maintenance and repair of motor vehicles |
1995/first |
One of the leading companies in the car glass repair industry. Due to the death of one of the founders, part of the ownership is in a transition phase, successors are active in the company. Small company. Osrednjeslovenska region. |
|
6 |
Production of jewellery |
1999/second |
The leading producer of jewellery, trading precious metals and stones. Ownership and management are being transferred from founder to his successors. Founder active in the company, but retired. Medium-sized company. Savinjska region. |
|
7 |
Production of pellet stoves |
1994/first |
A developer and producer of pellet stoves, holding patents. Management and ownership in hands of the founder. Successor is active in the company. Small company. Podravje region. |
|
8 |
Production of car batteries |
1974/first |
A developer and producer of car batteries and garden equipment. Management has already been transferred, but not ownership; founder retired, active in the company. Small company. Dolenjska region (South-East Slovenia). |
|
9 |
Wholesale trade |
1992/first |
The company is specialized for wholesale trade with Macedonian products. Management has already been transferred to the successor, but not ownership. Founder retired, but remains active in the company. Micro company. Osrednjeslovenska region. |
|
10 |
Wholesale trade and services—sanitary equipment |
1992/first |
The company is specialized in the development of sanitary equipment. Management and ownership have been partly transferred to the successors. Founder is employed. Successors are active in the company. Small company. Primorska region. |
|
11 |
Road transport, logistics, services, trade |
1989/second |
One of the biggest road transport companies. Ownership and management have been transferred from the founder to the wife and successive children. Founder retired, but active in the company. Medium-sized company. Osrednjeslovenska region. |
|
12 |
Retail trade—cars, service |
1990/second |
One of the strongest car traders. Management has been transferred to the external manager and the successive children. Ownership has been partly transferred. Founders have retired and are active in supervisory board. Medium-sized company. Podravje region. |
|
13 |
Production of products from concrete for construction industry |
1990/first |
A company with a strong tradition in production of concrete products. Management and ownership have been partly transferred to the successors. Founders and successors are active. Small company. Notranjska region. |
|
14 |
Wholesale and retail trade with car spare parts and services |
1986/first |
The leading car-glass repair company. Ownership and management are in the hands of founders. Founders active. Successors employed and involved in management. Small company. Podravje region. |
|
15 |
Wholesale and retail trade with metal products, production of faucets |
1996/first |
A developer and producer of faucets. Holding patents. Founder retired, active in the company. Ownership and management not transferred. Successors active in the company. Micro company. Podravje region. |
|
16 |
Production of working clothing |
1978/first |
A developer and producer of working clothing. Ownership and management not transferred, although both founders retired. Successors active in the company. Medium-sized company. Savinjska region. |
|
17 |
Sauna, cosmetics, wholesale and retail trade |
1971/second |
A long tradition of the first sauna and later cosmetics studio. The founder is retired but active in the company. Successors are managing the company, ownership has been partly transferred. Small company. Osrednjeslovenska region. |
|
18 |
Wholesale and retail trade textile |
1992/first |
Company is present throughout Slovenia through own shops. Ownership and management have not been transferred. Successor is active in the company. Medium-sized company. Prekmurje region. |
|
19 |
Sport club, restaurant |
2009/first |
Company is active in the field of sports activities (sport club), accounting, and family runs a restaurant. Ownership and management have not been transferred. Successor is active in the company. Micro company. Osrednjeslovenska region. |
|
20 |
Retail trade—organic food |
1989/first |
A pioneer on the field of trading organic products in Slovenia. Ownership not transferred. Management transferred to the successor. Founder active and in procuration. Micro company. Podravje region. |
Table 6.2 introduces the characteristics of the sample from the aspects of the founders' and the successors' formal education, external working experiences, and “familiness” as well as the importance of each of them in the eyes of founders and successors.
|
Entrepreneurial competences |
Founder (comment frequency) |
Successor (comment frequency) |
||
|
Done |
Found important |
Done |
Found important |
|
|
Formal education |
6 (30%) vocational, 5 (25%) high school, 9 (45%) higher professional or university degree |
17 (85%) |
16 (80%) higher professional or university degree, 1 (5%) high school, 3 (15%) students |
20 (100%) |
|
External working experiences |
18 (90%) |
18 (90%) |
8 (40%) |
20 (100%) |
|
“Familiness” |
20 (100%) |
20 (100%) |
||
Formal education is not as important for 3 (15%) of the founders. Instead, they emphasized the importance of experience and a broad understanding of the business. The rest of the interviewed founders found formal education to be especially important for the generation of successors. Successors are mostly very well educated, although mostly in the fields of economics and business/entrepreneurship, which are less technical fields.
Regarding external work experiences, the research results show that only 2 (10%) of the founders started their business with no previous experience; all others (90%) had previous work experience, albeit not always from relevant fields, although they all found the experiences to be very important. Twelve (60%) successors had no previous work experience in other firms, whether in the same or different industries. Three (15%) had experience in other firms, in the same and different industries. Six (30%) completed internships in other firms, mostly in different industries, and 4 (20%) completed internships abroad, mostly as Erasmus exchange students or as part of their training as business partners.
According to the founders, familiness is a unique resource and highly important for the sustainability of a family firm. Sixteen (80%) successors found familiness to be very important for developing working commitment, 14 (70%) for developing attitude toward entrepreneurship, 20 (100%) for the development of social relationships, and 10 (50%) for the development of attitude toward risk.
The following quotes were taken from the interviews.
“Formally educated people are more open to the external environment. They have a lot of general knowledge, but at the professional level they all fail the exam. Practice, practice, practice: it is extremely important.”
“...academic knowledge broadens young people's horizons and gives a good basis for using knowledge in practice... thus, you can more easily compete with your competition....”
“...I could not afford to study myself, and I gladly support my child's education... ”
“The next generation must study to understand new technologies, they have to acquire maximum theoretical knowledge, but then—experiences count more and more...”
“...academic knowledge helps you recognize more potential solutions...”
“I would love to work in another company and get external experience and insight into other working environments, especially in a large firm, but the economic situation in the country does not enable this experience.... And the family firm needs me...”
Most founders and successors concluded that familiness is a matter of trust.
Table 6.3 reveals the picture of the knowledge transfer in the studied sample from the aspect of founders and successors and how important they found each form of knowledge transfer for the successful integration of successors in family firms.
|
Knowledge transfer |
Founder (comment frequency) |
Successor (comment frequency) |
||
|
Done |
Found important |
Done |
Found important |
|
|
Early exposure |
19(95%) |
20(100%) |
19(95%) |
20(100%) |
|
Mentoring |
9(45%) |
19(95%) |
17(85%) |
20(100%) |
|
Apprenticeship |
10(50%) |
6(30%) |
10(50%) |
10(50%) |
|
Learning by doing |
17(85%) |
20(100%) |
17(85%) |
20(100%) |
|
Participation in decision making |
0 |
0 |
13(65%) |
13(65%) |
|
Involvement in strategic planning |
0 |
0 |
13(65%) |
13(65%) |
|
Teamwork |
15(75%) |
15(75%) |
15(75%) |
16(80%) |
Nineteen (95%) founders exposed their children early to the family firm's environment; only in one case was the son-in-law not exposed early to the family firm environment. In the case of successors, the sample matches. According to successors, early exposure to the family firm is crucial for their interest in the family business. Nine (45%) founders mentored their children, while 8 successors were mentored by a non-family member; one of the founders (5%) compared apprenticeship to mentoring. Seventeen (85%) successors reported being mentored or coached by a parent or nonfamily member, and one successor mentioned an external professional. The case studies revealed that apprenticeship is not a common way of transferring knowledge in Slovenian family firms. Learning by doing is seen as a very important way of transferring knowledge to the successors: Founders believed that letting children observe them at work and simply throwing them in the water to swim is a very good way of getting experience.
The founders did not report on the involvement of successors in the decision making. However, 13 (65%) successors indicated that they participated in decision-making processes after they became actively involved in a family firm. Founders did not report involvement of successors in strategic planning processes. However, again, 15 (75%) successors believed that they were involved in strategic planning processes, but not before their active involvement in the family firm. Fifteen (75%) founders reported that they involved their children in teamwork. In the case of successors, the sample matches. Sixteen (80%) successors found teamwork to be an important form of knowledge transfer.
- 1302 reads
