Home⇛International Journal on Social Innovation & Research⇛vol. 15 no. 1 (2023)

Succession Planning Practices And Performance Of Selected Family-Owned Smes In Quezon City: 3 Bases For A Proposed Business Continuity Model In Philippine Setting

Maria Teresa Martinez

Discipline: others in business and management

 

Abstract:

A proper succession plan is essential to sustain a small-medium enterprise (SME). Business owners/founders need to identify the pool of potential successors, then prepare them with adequate experience and training to lead the business in the future. The paper focuses on how current succession planning practices are implemented in familyowned SMEs. In assessing these practices, it is imperative for a business to survive in a competitive market. The use of mixed method research evaluated if SMEs are adapting the current practices and assessed the effect of these practices to organizational performance. The study revealed that SMEs have distinct characteristics in succession planning in terms of recruitment, talent mapping, training/development, and job rotation-mentoring. The SMEs according to ownership, capitalization and industry classification showed no significant differences which concludes that regardless of size, the business will adhere to these succession planning practices continuing the business. In the same manner the relationship of these succession planning on the performance of SMEs were evaluated that resulted to positive correlation. In all discussions, three cornerstones for succession planning were identified as the basis for the business continuity model. People, probity, and plan are three components that strengthens a small to medium or even larger enterprises business longevity. People are the owners/founders/successors. Probity is the quality of family relationships and value systems passed through generations. Plan is a written document to serve tas roadmap to business continuity. A business model is proposed to address the need to scale up a familyowned SME as one of the economic thrust of local government of Quezon City to lessen the failure rate of these growing SMEs.



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