Likelihood of heirs apparent to join the family business: A study on the factors leading to a successful intergenerational transfer

• Main Authors: Lai, Sheue Yng R., Mancilla, Charmaine Laurene G., Tang, Katrine Anne T., Valdez, Maria Camille R.
• Format: text
• Language: English
• Published: Animo Repository 2011
• Online Access: https://animorepository.dlsu.edu.ph/etd_bachelors/14758
• Institution: De La Salle University

Successful transfer of ownership from one generation to the next has always been a crucial process in every family business. This issue has been the basis of most researchers to explore on the factors that may affect the decision of heirs apparent to enter the family-owned business (FOB). Unfortunately, only a few studies have been made regarding succession in FOBs in the Philippine setting. This study utilized the framework of the Successor Retention Process Model. Moreover, the study provided three statistical procedures in order to achieve the objectives of this research. First, the Pearson‘s Correlation test was conducted to analyze if the selected factors such as childhood experience, parents‘ attitude, sibling rivalry, vision, esteem, education, leadership development, gender, interest and financial soundness have significant relationships with the dependent variable. Second, an Ordinary Least Squares (OLS) regression method was conducted to know the causality and the impact between these factors with the likelihood of joining the FOB. Third, an Analysis of Variance (ANOVA) was conducted to analyze if the difference between the selected categories are significant in terms of likelihood in joining the FOB. These categories are company size, gender, birth rank and requirement in joining. It appears through evidence that the company profile does not influence the likelihood of an heir apparent in joining the business. Moreover, requiring Likelihood of Heirs Apparent to Join the Family Business the successor to enter the business also increases their likelihood of joining the business. Among all the factors, gender has the greatest impact on the likelihood of heirs apparent to join the FOB. Moreover, self-esteem, having interest in the business and the financial soundness of the business also resulted in having a significant relationship with the dependent variable.