Master Thesis Challenges of a female successor of a family business Author: Theresa Fritsch Supervisor: Björn Bjerke Examiner: Philippe Daudi Academic term: 18.05.2017 Subject: Leadership and Management in International Context Level: Master Course code: 4FE75E CHALLENGES OF A FEMALE SUCCESSOR OF A FAMILY BUSINESS MASTER THESIS submitted at the IMC Fachhochschule Krems (University of Applied Sciences) Master Programme Marketing and Sales Linnaeus University Sweden Master Programme Leadership and Management in International Context by Theresa FRITSCH for the award of the academic double degree Academic Degree Master of Arts in Business & Master of Science in Business and Economics Advisor FH Krems: Edith Singer, Prof. (FH) Dr. Advisor Partner University: Björn Bjerke, PhD. Submitted on: 31.05.2017 Statutory Declaration I declare in lieu of an oath that I have written this Master thesis myself and that I have not used any sources or resources other than stated for its preparation. I fur- ther declare that I have clearly indicated all direct and indirect quotations. This Master thesis has both been submitted at the IMC Fachhochschule Krems and the Linnaeus University and has not been handed in elsewhere for examination pur- poses. Kalmar, Sweden, 31.05.2017 Signature Student I Acknowledgements This master thesis is the crowning achievement of my academic path and I would have never accomplished it without the endless support of my family, my boy- friend, closest friends and supervisors. I am very grateful for their advice, their pa- tience, their encouragement and their love. II Abstract Family businesses are the backbone of the German economy and, indeed, of al- most all economies in the world. Every year business owners face many challeng- es, one of which is the succession process. Unfortunately, daughters are often considered or perceived as less suitable or viable choice for the position of a suc- cessor, compared to sons. The aim of the master thesis is to identify potential challenges a female successor faces when taking over a family business and whether various strategic and/or structural requirements need to be considered by the daughter within the succession process. Empirical data has been gathered within the methodological framework of the grounded theory. Semi-guided expert interviews have been conducted to gain empirical insights. The results indicate that the challenges each individual successor will experience as most crucial or difficult will always depend on her personal character, on the senior family mem- bers’ behaviour during the succession process, and on the company’s hand-over capability at the outset of the process. Moreover, the strategic and/or structural requirements the successor faces are not as much influenced by gender, as by the up- or out-dated circumstances of the existing strategies and structures of the fam- ily business, which will ultimately determine the requirements the daughter has to fulfil. In conclusion, the succession process is very complex and burdened with emotions from the family members. Having a clear road map for the succession that leaves room for improvement in case of unpredictable factors in advance can be essential for the success of the succession. Hiring an external expert as sup- port can be beneficial as well. Additionally, the daughter aspiring to lead her fami- ly’s company must be 100 % sure that her life’s vision is compatible with the vision of the family business. Keywords: Female successor, family-business, succession, female leadership, millennials III Table of Contents Statutory Declaration ................................................................................................ I Acknowledgements ................................................................................................. II Abstract ............................................................................................................. III Table of Contents .................................................................................................. IV List of Figures and Tables .................................................................................... VII List of Abbreviations .............................................................................................. IX 1 Introduction .................................................................................................. 1 1.1 Background and Justification of the Topic .................................................. 1 1.1.1 Economical Aspect .................................................................................. 1 1.1.2 Rhetorical Aspect ..................................................................................... 3 1.1.3 Women of the Generation Y..................................................................... 3 1.1.4 Leadership and Entrepreneurship: Building the Bridge ............................ 4 1.2 Personal Interest of the Topic ..................................................................... 7 1.3 Research Gap ............................................................................................ 8 1.4 Research Problem, Research Objectives, Research Question and Methodology ............................................................................................... 9 1.4.1 Research Problem ................................................................................... 9 1.4.2 Research Objectives .............................................................................. 10 1.4.3 Research Question ................................................................................ 10 1.4.4 Methodology .......................................................................................... 11 1.5 Scope and Limitations .............................................................................. 12 1.6 Chapter Outline of the Thesis ................................................................... 13 2 Theoretical Framework ............................................................................... 15 2.1 Definitions ................................................................................................. 15 2.1.1 Family Business ..................................................................................... 15 2.1.2 Generation Y and Millennials ................................................................. 18 2.1.3 Leadership and Female Leadership ....................................................... 19 2.1.4 Company Succession ............................................................................ 24 2.2 Different Types of Company Takeover ..................................................... 26 2.2.1 Internal succession ................................................................................ 27 2.2.2 External succession ............................................................................... 33 IV 2.3 Challenges of the Handover Process: the business-family-successor paradox .................................................................................................... 37 2.3.1 Business Indicator .................................................................................. 41 2.3.2 Family Indicator ...................................................................................... 46 2.3.3 Personal Indicator .................................................................................. 54 2.4 Female Leadership ................................................................................... 60 2.4.1 Types of Female Leadership from the Perspective of Behaviour and Characteristics ....................................................................................... 61 2.4.2 Gender-related Aspect ........................................................................... 66 2.4.3 Generation Y is leading differently ......................................................... 70 2.5 Interim Conclusion .................................................................................... 73 3 Empirical Analysis ....................................................................................... 76 3.1 Methodology and Research Style: examining `Grounded Theory´ ........... 77 3.2 Literature review ....................................................................................... 78 3.3 Data Collection ......................................................................................... 79 3.4 Research Objectives ................................................................................ 79 3.5 The interview ............................................................................................ 81 3.5.1 Structure of the Interview Guide ............................................................. 82 3.5.2 Selection of the Interview Experts .......................................................... 83 3.5.3 Pre-Test ................................................................................................. 84 3.5.4 Performance of the Interviews ............................................................... 85 3.5.5 Evaluation of the Interviews ................................................................... 85 3.5.6 Theoretical Sampling and data saturation .............................................. 87 3.6 Framework of the applied Methodology .................................................... 88 4 Data analysis .............................................................................................. 89 4.1 Data Analysis of the Findings and Interpretation