Research On The Influencing Factors And Econo-Mic Consequences Of Family Firms' Succession

As one of the most common forms of business,family enterprises accounted for 55.7 percent of China's private enterprises by 2017.Firstly,this paper selects the family enterprises in the pharmaceutical industry as the objects of observation.With the growth of the generation of entrepreneurs,China's private pharmaceutical enterprises have entered the succession trend,how to maintain the foundation of the industry has become a key concern of family businesses.This paper selects two typical cases “HISOAR and TASLY” that have completed the shift for comparative analysis.Firstly,reviewed the specific handover process,found that “departmental exercise – acting as general manager – serving as chairman” is the universal training path for successors of family businesses in China.The successor of HISOAR sold the company after 4 years,While the successor of TASLY inject vitality in the enterprise through strategic reform,why it comes so different?Then focus on analyzing the differences of influencing factors in inheritance process from four aspects: external environment,internal motivation,successor authority construction and organizational system.Compared with TASLY,HISOAR faced with the insufficient internal motivation and imperfect organizational system.Most importantly,the successor fails to establish personal authority.TASLY provided us with a good reference sample,the first generation grasped the inheritance opportunity properly,made a detailed plan and implemented step by step,and the two generations had close communication,the successor had a strong desire to inherit and won recognition through him own ability,finally completed the succession smoothly.Then analysis the economic situation by taken the second generation succession as the node,found that in terms of short-term performance,the market is not optimistic about the event of corporate handover.However,there are big differences in the long-term performance of the two case companies.After the succession,HISOAR performs even worse,while some profitability indicators of TASLY are much higher than the pharmaceutical industry's average.Finally,put forward corresponding Suggestions based on the experience summary of the succession process of the case enterprise,so that the family business can take precautions when facing the problem of succession.