Industry complexity is what appears to be defining a succession pattern for all companies which constitute the
industry. The higher the degree of complexity is, the more resources companies are
to invest in business succession to satisfy stakeholders and vice versa.
The most resource intensive pattern of business
succession is the talent pool, while
the least costly is the ad hoc reaction.
Stakeholders’ satisfaction with the
outcomes of succession will be the highest, should the pattern chosen for
business succession match industry complexity. At the same time stakeholders opine on succession results negatively in cases of mismatch.
It is important to notice that SMEs operating
in complex industries usually lack resources for appropriate - prescribed - patterns like the
long-term heir and the talent pool. Instead, they tend to apply less laborious
and expensive patterns. That leads to unsuccessful
successions and leaves involved stakeholders dissatisfied. In other words, each
industry signals its companies which succession pattern is to be used, and
those who do not recognize it fail in business transfer.
It works like this:
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