PROFESSIONALIZING MANAGEMENT IN THE PROCESS OF FAMILY BUSINESS SUCCESSION: SECURING SUSTAINABLE DEVELOPMENT OF BULGARIAN FAMILY FIRMS
Author: Iliya Kereziev (UNWE)
family business, succession, management transfer, management professionalization, Bulgaria
The transfer of management control represents preparation of family business for the succession process in terms of improvement of its management system in relation to future needs of the company and the family. The transfer can take place separately from the professionalization of management, but in the case of family firms which are in their early stage of development, the both processes could be realized together. The necessity of management formalization becomes stronger in the process of business development and together with the increase of its financial, organizational and material resources. In the case of family businesses this need is also strengthened by family enlargement. It is difficult to define when exactly professionalization should start, but it is certain that а late professionalization might cause serious problems for the company and might cause barriers to its development. In the case of Bulgarian family firms with growth potential, the necessity of management transfergoes conveniently together with management professionalization. On one hand succession represents a contemporary problem for a big part of companies, but on the other hand they are in an early development stage and in most cases are governed by the first generation of family entrepreneurs. The arrival of new generation of managers might be combined with the formation of strong management team and implementation of formal planning, regular family meetings and councils, clear management responsibilities, mechanisms for work appraisal and control. This would make family businesses sustainable and independent from the outcomes of the succession process.