Factors Influencing Family Business Continuity in Indian Small and Medium Enterprises (SMEs)

Abstract

Most of the research on family business continuity is based in the western world. Continuity of family business is affected by social and cultural factors on one hand and on the stage of growth of the economy on the other. This paper focuses on the continuity concerns with reference to (1) the Eastern context and (2) the developing economy’s context, by studying Indian family businesses, with (3) specific focus on Small and Medium Enterprises (SMEs). Data were collected from SME business families using a questionnaire. The impact of various factors was examined on the family, the business and the inductee. This empirical study validates some of the drivers of effective succession identified so far in the literature. It sharply identifies the variables that can be more relevant and can directly affect the outcome in terms of positive impact on the business, family and the inductee. The findings of the study will be of great help in successful succession planning for the growth and development of SMEs that contribute significantly to economic growth.