Business succession and intellectual capital management in family firms

Family businesses are unique institutions. They represent a context (or an arena) in which two seemingly disparate social units (i.e., families and businesses) are highly integrated. This connection extends to succession across generations, which, although natural, can be a difficult process. The entrepreneur / founder, thanks to his long stay in the family business have a substantial amount of tacit knowledge related to the firm which often depends business success. In the succession process is important diffuse the overall knowledge, or intellectual capital, at successor. Intellectual capital assume in a family firm own feature, it includes knowledge built through the life experiences of each family member, or what the family member knows regarding the business and relationships achieved, therefore family intellectual capital is also the family members’ knowledge gained through life experiences, but also their shared values expressed as traditions (family culture) and business acumen transmitted to the employees while working there (and staying after the acquisition). All these items together form a unique entity. This is what the family tries to pass on from generation to generation in an effort to create new organizational learning processes. In other words, family firm’s success is reachable only if intellectual capital, and specifically human and relational capital, is properly managed. To maintain family and organizational cohesiveness, management must develop planning processes and mechanisms that provide a valid structure for the transference of leadership. Starting from these theoretical principles, the research investigates, through case study analysis approach, how are managed human and relational resources in the business succession process and how the process is communicated to the external environment.