Management Buyouts in Family Businesses - Change in Structure, Strategy and Culture and the Effects on Strategic Orientation
Project Description
Management BuyOuts (MBOs) of family businesses are an alternative solution to the problem of succession. A MBO is the sale of a company to the incumbent management. It offers an opportunity to maintain the company's autonomy and continuity, especially in family firms. Having a closely associated manager continue to run the company strengthens the chances of retaining the company's culture and ethos - an important aspect for family businesses.
Nonetheless, MBOs often entail a period of change. They are phases of uncertainty which at the same time open up new options. Research has shown that MBOs have led to revitalization and strategic innovation in corporations. Hence MBOs may can clear the way for growth and renewal for family firms as well without them losing their special strengths; the resources which have been built up through the years (common language, goals and values). At present there has been no studies made into this interplay of strategic renewal and tradition as a consequence of succession MBOs.
This paper examines the changes in family businesses when they are converted into management-run companies and the effects of these changes on strategic orientation. It studies the changes in structure, strategy and culture, the cause-and-effect relationships between the changes in these variables and the post-buyout positioning of the company. Considering in particular the perspective of the buying-in management, the intention is to identify the levers which enable a successful and sustainable orientation post-buyout.
Nonetheless, MBOs often entail a period of change. They are phases of uncertainty which at the same time open up new options. Research has shown that MBOs have led to revitalization and strategic innovation in corporations. Hence MBOs may can clear the way for growth and renewal for family firms as well without them losing their special strengths; the resources which have been built up through the years (common language, goals and values). At present there has been no studies made into this interplay of strategic renewal and tradition as a consequence of succession MBOs.
This paper examines the changes in family businesses when they are converted into management-run companies and the effects of these changes on strategic orientation. It studies the changes in structure, strategy and culture, the cause-and-effect relationships between the changes in these variables and the post-buyout positioning of the company. Considering in particular the perspective of the buying-in management, the intention is to identify the levers which enable a successful and sustainable orientation post-buyout.
