PROPOSED SUCCESSION PLANNING FOR NEXTGENERATION FAMILY BUSINESS: A STUDY OF PT ZVJ

• Main Author: Valencia, Zefanya
• Format: Theses
• Language: Indonesia
• Subjects: Manajemen umum
• Online Access: https://digilib.itb.ac.id/gdl/view/80649
• Institution: Institut Teknologi Bandung

This comprehensive study, entitled "Proposed Succession Planning for NextGeneration Family Business: A Study of PT ZVJ," provides a thorough examination of the crucial procedure of succession planning in family-owned businesses, with a particular emphasis on PT ZVJ, a well-established Indonesian private investment company. This research explores the intricate and difficult process of transferring leadership and management from one generation to the next in family firms, acknowledging their significant role in the global economy. The study emphasizes the need of efficient succession planning in guaranteeing the ongoing and enduring nature of family enterprises throughout the next generation. The study utilizes a qualitative approach, using semi-structured interviews and a thorough examination of secondary data. This methodology enables a comprehensive examination of the experiences and viewpoints of individuals engaged in family businesses, yielding valuable insights into the intricate aspects of succession planning. The study's focus on PT ZVJ offers a case-specific understanding while shedding light on broader succession challenges faced by family businesses in general. A significant discovery of this study is the recognition of numerous crucial obstacles faced during the transition phase in family businesses. The efficacy of the succession planning process is influenced by generation gap, communication hurdles, and credibility issues. The generation gap accentuates disparities in perspectives and business methodologies between the first and next generations, presenting obstacles in harmonizing business objectives and plans. Communication gaps, which are sometimes worsened by managerial approaches and generational outlooks, can result in misunderstandings and conflicts inside the family business. The credibility gap, a substantial obstacle, emerges from the apparent discrepancy in trust and esteem between the founder and the successor, affecting the smooth transition of leadership and crucial commercial connections. The paper explores the significance of closing these gaps by employing a methodical and effectively executed succession planning process. This underscores the importance of tackling these difficulties, as they are not only essential for a seamless leadership transfer but also for the sustained profitability and expansion of the family business. The study presents a comprehensive succession planning framework that involves early identification of possible successors and their preparation through education and practical experience. Properly preparing successors is crucial to ensure they maintain family values and effectively guide the firm towards success. Another noteworthy component of the study is its investigation into the many stages of the succession process. The study outlines four crucial phases: initiation of the process, education of the successor, selection of the successor, and intergenerational transfer. Every stage is crucial and necessitates meticulous planning and implementation. The process initiation stage encompasses the deliberative elements related to retirement and transition, with a focus on the importance of proactive planning. The importance of successor education is emphasized, as it equips successors with the essential information and skills required for effective management. The process of selecting successors is a nuanced endeavor, requiring careful evaluation of multiple aspects to guarantee the optimal alignment with the business's future objectives. The intergenerational transfer stage is the final phase that concentrates on the actual transfer of management and ownership. This stage necessitates careful planning to guarantee the continuation and maintenance of the business's fundamental values and strategy. The results of the study show that efficient succession planning in family businesses is a dynamic, continuing process rather than a one-time occurrence. Thorough evaluation of multiple elements is necessary, encompassing family dynamics, company objectives, and the individual qualities of potential successors. Establishing a wellorganized and thorough succession planning framework is crucial for effectively managing these intricacies, guaranteeing the long-term viability of the company, and preserving family unity. Ultimately, this research makes a substantial contribution to the comprehension of succession planning in family businesses. This resource offers unique perspectives and actionable recommendations for family enterprises, specifically within the framework of developing markets such as Indonesia. This study emphasizes the importance of adopting a comprehensive strategy for succession planning that takes into account the distinct difficulties and advantages associated with family-owned businesses. Therefore, it functions as a significant asset for business owners, successors, and students who are interested in the complex dynamics of family business succession.