Breaking out or Breaking In? Exploring family dynamics in planning for succession

The aim of this paper is to explore family dynamics in planning for succession and continuity in Punjabi-Indian ethnic family firms in the UK. The research objectives are to analyse how household dynamics can shape activities within small family enterprises within a specific cultural and sociological context, and to examine whether these later generation family firms actively involve family members in developing family businesses, that can be sustained beyond the current generation. The transition of ownership is crucial for small family business and extant literature indicates the differences between first and later generation family firms succession processes (Zellweger et al., 2011; Nodqvist et al., 2013). British-born second and third generation ethnic minorities are determining a new multicultural image of Britain and their methods of conducting business are somewhat different from their parents and grandparents who have originally immigrated to the UK. Family firms literature indicates that second generation immigrants are more likely to “break out” by seeking professional salaried employment. Hence, planning for succession in later generation family firms is a strategic issue, and all potential family stakeholders ought to be involved in the decision-making process (Rusinovic, 2008; Sharma, 2013). In this study of ethnic minority family firms we analyse the extent of second and later generations’ involvement in the family business. A qualitative methodology was adopted within this study utilising focus group interviews. The findings illuminate “reverse break-out” or “breaking in” processes, indicating that the later generation family stakeholders, show interest in being actively involved in shaping the family business. Despite their aspirations to enter professional trajectory, the long-standing family business setting provides a platform for their ambitions to be realized. “Reverse break-out” actions of family members balance unstable and divergent stakeholder interests within family business households. Four contributions have emerged from the study and add to our understanding of heterogeneity of family businesses especially those which share specific ethnicity, as only at the intersection of various elements one can uncover the dynamics of relationships in ethnic family firms.