PASSING ON STRATEGIC VISION - FAVORED MODES OF SUCCESSOR PREPARATION BY CEOS OF FAMILY AND NONFAMILY FIRMS

How do CEOs of small businesses help their successors develop tile str ategic knowledge and insight needed to nln the company? This study com pared the ratings of 236 family-firm CEOs with those of 121 nonfamily- firm CEOs regarding the relative importance of different modes of succ essor preparation. The results show significant differences be tweer? the family and non-family sub-samples in 15 of the 19 forms of prepara tion studied. In general, CEOs of non-family firms tend to favor succe ssor preparations that are ''outsourced'' rather than internalized wit hin tile company. CEOs of family firms take a more direct approach to preparing successors - one that places a premium on developing persona l relationships between CEO and successor, and between tile successor and the stakeholders of the business.