Global Journal of Management and Business Research, A: Administration and Management, Volume 22 Issue 5

determining goals, needs, and roles within an organization and preparing individuals or employee groups for responsibilities relative to work needed within an organization in the near future Motwani, (2016). The lack of succession planning in Nigeria is a serious issue militating against the survival of family- owned businesses, as 94.2% of entrepreneurs do not have a succession plan Okon, and Isong, (2016). Despite the challenge, posed by a lack of succession planning, most studies failed to examine succession planning and its effects on the continuity of family- owned enterprises in Nigeria. Few of the research conducted on succession planning tend to focus more on the small and medium scale enterprises, paying less attention to family-owned businesses. This situation is appalling considering the fact that a large majority of SMEs are family-owned enterprises (Ugwu, Ekwochi & Everist, 2017). The purpose of succession planning therefore is to minimize the gap and risk in the operations of the organization, when key leader suddenly leaves the business. The objective of this paper is to examine the effect of succession planning on family business continuity in Lagos State, Nigeria. II. R eview of L iterature Succession is arguably one of the most critical issues a family business has to face. It is also one of the most difficult phases in family business. Succession is a reciprocal interaction that occurs between the predecessor and successor throughout the transferring process of leadership (Motwani, 2016) and a common organizational contest to ensure the survival of incumbent firms in operation. Succession planning is a dominant theme in family business research and it is seen as intergenerational transfer and a process in which the business owner plans for the transfer of knowledge, skills, values, management, control and ownership of a business entity to the next generation. According to Tiller, (2012) succession planning was first introduced by Henri Fayol French management theorist in 1916 who believed that if succession-planning needs were ignored, organizations would not be prepared to make necessary transitions. Stability of tenure is one of Fayol’s 14 principles of management indicating that high employee turnover leads to inefficiency and consequently to a need for succession planning Sharma, and Agarwal (2016). Without doubt, the succession processes in family firms represent the most critical period confronting family businesses, since it is precisely when the business is transferred from one generation to the next Okon, and Isong, (2016). Supportably one of the main dreams a founder typically has is to hand down his legacy to his offspring, given that he has accumulated capital, commitment of potential members, entrepreneurial skills, and legitimacy Williams, and Ahmed, (2018). Moreso, successful companies, agencies and organizations have one thing in common, having culture of succession management (Walsh & Seaward, 2006). Succession of the leadership is considered one of the biggest challenges for most family businesses. It emerges as an important area of study because one of the primary reasons family businesses failures is lack of a written succession plan (Chacha, 2016). Succession in organizational theory and practices refers to the process of transferring managerial control from one leader or one generation of leaders to the next. a) Benefits of Succession Planning Succession planning is not just important for the company and its current employees, but also for investors, customers, the community the employees and their families. Succession planning is widely believed to help business organizations with internal re-sourcing, reduce attrition of the work force caused by job- hopping high-fliers, and prepare qualified candidates for appointment to senior management positions” Motwani, (2016). Succession planning is critical to the sustainability and competitive advantage of any organization irrespective of its ownership nature. b) The Succession Management Process Whatever the approach to be used, the basic steps of succession planning are almost always similar, based on Zellweger, Nason, and Nordqvist (2012) there are six basic steps of succession planning: Establish knowledge, skills, and abilities needed at each leadership level, identify a pool of qualified candidates for various leadership roles, assess candidates for respective leadership positions, Implement individual development plans, select leadership replacements as positions become available, implement leadership transition. However according to Sentot, Wahjoedi, and Nirbito (2014), identified four reasons that cause the succession process to be accelerated which is called the four D’s which are: Death, Divorce, Disability, and Departure. The succession management process model by Harvey and Evans (1995) will be presented here. The model has three phases, which included: 1. Pre-succession, phase in which the potential successor has not entered the business yet. 2. Succession, phase in which the successor moves through the formal hierarchy of the business. 3. Post-succession, phase in which conflict or damage in relationships and ambiguity that result from the previous phase are assessed and managed. c) Family Business Continuity The discourse on family business continuity will not be complete without looking at the possibility of the impact of the knowledge management as well as succession planning practices. Different studies have given different measures of family business continuity Succession Planning and Family Business Continuity: Perspectives from Lagos State, Nigeria 32 Global Journal of Management and Business Research Volume XXII Issue V Version I Year 2022 ( ) A © 2022 Global Journals