Family Business Succession and External Advisors. The Relevance of “Soft” Issues

The paper focuses on family businesses’ opinions and perspectives concerning soft issues raised by the succession process and their willingness to involve an external advisor. An empirical research based on multiple case studies has been carried out. Through 25 direct interviews with the incumbent and/or successor, we have analysed 15 Italian family businesses that have experienced or are going through a succession process and have involved, or have chosen not to involve, external advisors. The data analysis allowed for the identification of six main themes: 1) Why, it refers to the type of problems faced and the reasons why family businesses engaged external consultants); 2) How, it refers to the approach adopted by family businesses when addressing the succession process; 3) Who, it refers to the person (incumbent, successor, other) who decides to engage an advisor to deal with problems raised by succession; 4) What, it refers to the type of advisor engaged by family businesses and the type of advisory services requested; 5) Outcome, it refers to the result of advice services in terms of family businesses’ satisfaction/dissatisfaction; 6) Barriers, it refers to factors that prevent or hinder the involvement of external advisors. Results underline that most family businesses are aware of soft issues’ relevance for a successful succession. However, this awareness does not always turn into an actual request for advice. Family businesses often consider succession a private affair and prefer not to share it with external subjects. Instead, family businesses that have asked for external advisors have often complained, saying they are mainly focused on hard issues and forget that managing soft issues is often the real key to successful succession. Implications for theory and practice are discussed.