MANAGING INTERGENERATIONAL CONFLICT THROUGH STRUCTURED SUCCESSION PRACTICES: A CROSS-CULTURAL STUDY OF FAMILY BUSINESSES

Abstract

This study aims to analyze how a systematically designed leadership succession process can function as a strategic mechanism for managing intergenerational conflict within cross-cultural family businesses. Amid the significant role of family enterprises which constitute approximately 65% of companies worldwide and contribute substantially to national GDPs their survival rate beyond the third generation remains relatively low. This is largely due to inadequate succession planning and the absence of adaptive, long-term leadership transitions. Succession is not merely an administrative matter but also involves social, emotional, and cultural dimensions that shape the family’s vision, values, and business continuity. Divergent orientations between founding and successor generations where the former emphasizes stability and tradition while the latter prioritizes innovation and globalization often lead to internal tensions. The challenge becomes more complex in cross-cultural contexts, where variations in cultural values such as power distance and decision-making norms influence succession dynamics. While several formal mechanisms, including family councils and constitutions, have been implemented, they often overlook the emotional and cultural roots of such conflicts. This study proposes a conceptual model that frames leadership succession as an intergenerational dialogue of values and a means of fostering cross-cultural adaptation. Within this model, the founding generation acts as value guardians and mentors, while successors serve as agents of renewal and innovation. The synergy between these roles can transform potential conflicts into productive collaboration, strengthening the continuity of cross-cultural family enterprises