L’impatto del passaggio generazionale sulle performance economiche: un focus sulle imprese della provincia di Vicenza (The impact of family business succession on economic performance: a focus on businesses in the province of Vicenza (Italy))

Abstract

Purpose of the paper: the paper aims to verify the impact on economic performance of Family business succession or "other" changes in corporate structure.

Methodology: after the literature review, we have performed a twofold comparison between the economic performance s of 74 companies between 2009 and 2017, classified into three samples. First, we compare companies involved in a family succession to companies that did not change their corporate structure. Second, companies involved in other changes than family succession (e.g. expanding the shareholders team) are compared to companies that did not change their corporate structure.

Results: The research shows that companies involved in family succession get a lower operating profitability than the other ones during the first years after the succession, but they gradually become more reactive and economic performing. The research highlights how the greater theoretical-technical knowledge possessed by the new generation allows companies involved in the generational transition to recover more quickly the initial negative gap in terms of management capacity and profitability. However, this only happens if this change is supported by experience in the field, aimed at compensating for the lack of tacit knowledge that often occurs.

Research limitations: the pilot survey was carried out in a restricted geographical area and on a small sample of small-medium sized enterprises, selected by a survey; further research could apply the analysis model on a larger geographical and sample-size scale to support the conclusions.

Practical implications: the study suggests to “old” governance that company entrepreneurs should acquire greater awareness of the actual operational management capabilities of incoming generation. The outcome of Family business succession is related to the attitude of the “old” governance in the preparation phase of the handover. To minimize or remove the initial gap in profitability, the engagement of new generation in the preparation phase is crucial and it allows to gain experience in managing firms profitably.

Originality of the paper: the research compares companies affected by the generational changeover with other ones that change their structure in another way. Furthermore the research investigates the presence of differences in performance between different types of companies, their intensity and durability.