Emotional Attachment and Decision by Family-Business Owners to Seek Help from a Succession Planner
Many family-business owners (FBOs) desire to pass the business on to future generations, yet few transitions are successful. Studies point to irrational emotional attachment as the primary cause. Succession planners could help, but few FBOs seem to seek their services.
The primary intended outcomes of business succession planning are to help FBOs make rational succession planning decisions regarding how the transfer of the business can achieve their personal financial goals
A study of FBOs’ irrational emotional attachment to their firms (and other psychological factors) and the impact this has on their decision to seek help from a succession planner was conducted.
The study found that FBOs with a low level of emotional attachment sought help from a succession planner, while those with an irrationally higher emotional attachment did not. Psychological factors were also associated with the decision to seek help.
Findings from this study could help planners save time and money by targeting qualified candidates. If succession planners can determine the level of an FBO’s emotional attachment before they begin their engagement, they can choose not to work with those that are too emotionally attached and engage with lower level emotionally attached FBOs—or perhaps agree to work together with the FBO to overcome an irrational emotional barrier.