Escolar Documentos
Profissional Documentos
Cultura Documentos
6
(June 2008)
Ninetta Chaniotou
This report is carried out in the context of the transnational REINO pro-
ject (Renewal and Innovation to Business Transfers of Micro Companies).
The REINO project is co-ordinated by a Finnish development company
KOSEK and is funded by the DG Employment of the European Commission
under the European Social Fund, Article 6 - “Innovative Approaches to
the Management of Change” programme. During the two-year project,
partners in Denmark, Finland, Greece, and Italy create a support structu-
re and tools that assist entrepreneurs in carrying out business transfers
successfully.
Ninetta Chaniotou
for European Profiles SA
CONTENTS
SUMMARY .����������������������������������������������������������������������������������������������������� 1
1. Introduction.�����������������������������������������������������������������������������������������3
2. Background.�������������������������������������������������������������������������������������������� 5
4.1. The ideal business transfers flow chart of the Greek sub-project. 39
4.2. EU Legislation on Gender Equality. 40
4.3. Good Practises in Women Support Structures. 43
4.4. Best project ‘Promoting Entrepreneurship amongst Women’. 44
5. Bibliography.�������������������������������������������������������������������������������������� 45
SUMMARY
The main findings of this pilot project are that female behaviour in bu-
siness transfers does not differ very much to that of their male coun-
terparts. However there are entry barriers and sometimes operational
barriers.
family, and secondly the position of the mother in the family and her
occupation. The main support for the businesses that formed the pilot
group has come from two sources: the long experience, tacit knowledge
and concern / commitment of the transferor in helping the successor,
and the practical knowledge of their auditor/tax adviser. The pilot action
confirmed that a successful business transfer involves three types of
knowledge: explicit business development knowledge, explicit branch
expertise, and transfer of tacit knowledge. It has also shown that tacit
knowledge transfer depends on the attitude, the mentality of the trans-
feror, and it appears that the transferor is the best mentor. The question
is what to do when the transferor cannot or will not act as mentor. There
is where local CCI:s could help by setting mentoring teams in collabo-
ration, for example, with their old members.
2
www.reinoproject.eu
1. Introduction
1 http://www.gender-equality.webinfo.lt/results/european_union.htm
3
www.reinoproject.eu
• Methodology
• Results obtained
• Case studies (4)
• Findings, conclusions, & recommendations
• Selected references
4
www.reinoproject.eu
2. Background
Extensive research indicates that the most important thing for busines-
ses that are nearing their ‘generation shift’ age, is to consider as early
as possible the transfer, sell, or close down options. For example, in the
article Succession Planning in SMEs1 the authors study the differences
between bigger and smaller businesses. The study reports the results
of field research focusing on 368 family-based businesses, with regard
to the importance, nature, and extent of succession planning. It breaks
down businesses into a typology reflecting annual revenues, total num-
ber of employees and number of family members employed in the bu-
siness: “Consistent with extant literature, the findings reveal that most
family members join the firm for altruistic reasons. Issues related to fa-
mily relationships were rated as significantly more important in firms in
which more family members were employed within the firm. Moreover,
for firms with less than US$1m in revenues, a high priority is placed on
selecting a successor who possesses strong sales and marketing skills.
The findings show that regardless of their size, it is important for family-
owned businesses to develop a formal plan for succession, communica-
te the identity of the successor, and provide training/ mentoring to the
incumbent CEO”.
1 Motwani, Jaideep Grand Valley State University, USA, et al; Succession Planning in
SMEs: An Empirical Analysis; International Small Business Journal.2006; 24: 471-495
2 Lee, Yoon G. et all; A Profile of Succession Planning among Family Business Owners;
Financial Counseling and Planning, Volume 14 (2), 2003; ©2003 Association for Financial
Counseling and Planning Education.
--> “Using data from the 1997 National Family Business Survey, this study analyzed 673
family-owned businesses….. the findings indicated that only 20 percent had a written
succession plan. Among 673 family business owners, only about 14% developed a net
worth statement and 13% met with a financial planner or business consultant to dis-
cuss estate planning. Those family business owners with a succession plan tended to be
older, worked longer hours in their family businesses, had fewer numbers of children,
and had higher business management scores than did those business owners without a
succession plan. Those who started their own business were less likely to have a written
succession plan than those who inherited the business. Female family business owners
were less likely to have a succession plan than were male business owners. Based on
the findings, implications for financial counsellors/planners and family business consul-
tants are presented”. page 1.
5
www.reinoproject.eu
3 Kaslow, F. W. (1998). Handling transitions from mothers to son in the family busi-
ness: The knotty issues. Family Business Review, 11(3), 229-238
4 Janjuha-Jivraj, S. & Woods, A. (2002). Successional issues within asian family firms:
Learning from the Kenyan experience. International Small Business Journal, 20(1),
77-94.
6
www.reinoproject.eu
And
• the attitude towards transferring of the business ownership: a) trea-
ting all their children equally; b) getting their children started in the
business; c) proving financial security for themselves and survivors;
d) keeping the business within the extended family.
The results of the study confirm that “Those with a written succession
plan had a much higher mean level of business income ($2,396,763)
than did those without a succession plan ($582,775). Those with a suc-
cession plan had more non-family employees and had fewer children
than those without a succession plan”6. Moreover, the research also
shows that men are more likely to have succession plans than women
entrepreneurs: while 17,1% of men say they have a succession plan,
only 3,3% of women confirm the same7.
In the EU, a survey in 2000 for the Commission8 found that many of the
problems faced by start-up companies and entrepreneurs were common
to all, whether male, female, young, old, or from an ethnic minority.
Such problems included difficulties in accessing finance, problems in es-
tablishing or expanding markets, limited management experience and
qualifications, varying attitudes and competence in using IT, and prob-
lems with administrative and regulatory requirements. Nevertheless,
the research suggests that some of these factors are magnified in the
case of minority groups such as women entrepreneurs. The survey
suggests that access to finance, both for starting a firm and for growing
one, is seen as the biggest problem for women entrepreneurs. This may
be exacerbated by limited assets and lack of a track record in business.
And this is linked to a perception of discrimination (whether intentional
or unintentional) on the part of finance providers. According to the sur-
vey, these problems are significantly greater for women entrepreneurs
than for small businesses in general.
Among the measures which appear to have been most effective are
those which involve mentoring and showing role models. “One com-
mon problem for women considering setting up in business is a lack of
7
www.reinoproject.eu
confidence. When they are shown that they have the ability,….”9. This
statement is taken up by ACCA:
8
www.reinoproject.eu
These assumptions have been put to test through the Greek pilot acti-
on. As it happens, only the last statement has been confirmed. But this
is a very important issue. It is related also with the lack of sophisticated
structures supporting women in business transfers. For example, men-
toring among women is not developed at all: “Such senior-level women
could serve as role models and mentors for other women, something
that female workers overwhelmingly want, Forte research suggests. On
a scale of one to 10, 88% of women surveyed rated the importance
of female role models to their future success as a seven or higher.
Also, 77% say there is an insufficient amount of female role models in
business”12.
Again, the problem is for the smaller not the bigger businesses, in
which, gender roles tend to not be very important13. In the very in-
teresting presentation (Are Male Entrepreneurs more Productive than
Female Entrepreneurs? Evidence from Transition Economies) it is con-
cluded that “Women owned firms are on average smaller than men’s (in
terms of sales, no. of employees, and capital) but the growth in their
sales is equivalent”, and that access to land is the only constraint14 that
impacts differently men and women. The report hints that this might
indicate an insider’s and outsider’s model of business market entry.
12 Kelley M. Butler ; Wooing women: Today’s working women seek mentors, mother-
hood transition , 1 April 2006,Employee Benefit News; (c) 2006 Employee Benefit News
and SourceMedia, Inc. All rights reserved.
9
www.reinoproject.eu
One of the key findings of the baseline research that as done in the con-
text of the REINO project, and which was confirmed during the detailed
interviews with Greek businesses, is that Greek potential transferors
start preparing their successor many years before their planned retire-
ment time, and the successor is most often a person within the family.
Otherwise the pattern is to close down the company rather than look for
a successor at the last moment; selling the business is not so common
yet. The positive aspect of this pattern of business transfers is that the
transfer happens in a controlled way, at the same time transferring the
tacit knowledge of the business’s operation. This might be one reason
that transferors & successors do not see the reason neither for external
consulting or mentoring, nor for funding. The negative aspect of this
same pattern is that very often, the business transfer is just a transfer
of ownership rather than a moment of revitalisation of the company.
Thus succession plans are still rare in small and micro companies, and
this applies to both men and women transferors.
15 http://www.kethi.gr/equalpay/ KETHI
10
www.reinoproject.eu
• They are more educated than men and that they are active in all
branches of economic activity. They confirm the need for and the
lack of effective institutionalized practices/structures for career
counselling with special focus on women.
• Only 2,4% of the survey participants said they have been sup-
ported by a career advisor, while for those that have received such
a support, 6,3% came from teachers and professors. The majority
(40,1%) said they made the decision of their ‘dream profession’ all
by themselves, or that parents influenced (26,8%).
11
www.reinoproject.eu
Timeline
Objectives
Assumptions
12
www.reinoproject.eu
A set of criteria, reflecting the assumption, was agreed to test the hy-
pothesis and see how they correlate with positive women’s involvement
in business transfers, Table 1 below.
Table 1 Criteria to test the assumptions
• Region: The Greek pilot foresees one main Business Renewal Centre
(BRC) unit supported by two peripheral units (two antennas) and
operating respectively in Athens, Piraeus and Voiotia (Leivadia). The
e-registry has been a problem to all 3 organisations. Its lack actually
challenged the identification of potential transferors. Thus the pilot
action focused more in Voiotia, because the Voiotia CCI had already
decided to prepare a software identifying businesses according to
age and gender.
13
www.reinoproject.eu
14
www.reinoproject.eu
• Activities of the pilot action: The pilot action has covered seven
steps. The work was organised through the pilot e-registry for the
Voiotia businesses. The main processing was done by the UHCCI4
staff and the national coordinator. The process was supported by the
EP5 partner and discussed in the LAG6. Thus it has been a very cent-
ralised and controlled process. One reason for this is that the local
BUSINESS RENEWAL CENTRE (BUSINESS RENEWAL CENTRE (BRC))
antenna (of the Voiotia CCI) was still under preparation. But another,
more crucial reason is that the CCi:s in Greece are not so much used
yet to offer development services and to interact with their members
in fields other than administration and bureaucracy.
4. Initial contacts through phone calls: in the event that not enough
companies were coming to the project, the project started ma-
king individual phone calls. It made phone calls to the cases that
fulfilled the pilot action criteria (see previous § Profile of the tar-
3 See REINO project, Baseline research, Greek baseline research, pages 5-19.
15
www.reinoproject.eu
5. Regular contacts with the pilot cases; also when the entrepre-
neurs asked for them, and offer of support. There have been
some 5-6 visits per company, a in some 11 months.
• The ideal flow chart7. The REINO staff used the ideal flow chart to
benchmark the stage and service needs of the business transfers
case studies.
• Tools for structuring the case studies. The tools are a combination
of the Bank of Cases approach8 “refined” to target more the Greek
context. The tools for structuring the case studies are in Table 2 and
Table 3 below.
16
www.reinoproject.eu
Type of business
Why was the business transferred?
When the transfer process was actually initiated?
Was there a business transfer plan?
How long did it take to complete the transfer?
Do you use ICT?
What do you feel should improve to make the business better?
Involvement into the transferred business
• during the transfer period
• on going
Key daily support
Mental support / empowerment
Contribution of local CCI
17
www.reinoproject.eu
18
www.reinoproject.eu
A total of 1623 female businesses that closed during the last year and
of 225 female businesses that started during the last year were identi-
fied and matched. Ten (10) suitable cases were identified; there were
phone calls to all of them. Six (6) of them accepted to discuss more;
and finally four (4) are interesting to deal with more deeply, active in
the following branches: local newspaper; dry cleaners; kitchen furniture
franchise; car dealer.
We have identified that two are the key factors for motivating women to
entrepreneurship & business transfers: (i) the occupation of the mother
and her position in the family (actual and moral power-related aspects;
behavioural model); (ii) the values of the family, and especially their
views and tacitly transmitted ideas of how they are viewing and valuing
entrepreneurship.
19
www.reinoproject.eu
• Processing phase
Four female business transfers have been processed and are described
below as the REINO pilot action case studies.
• Other
20
www.reinoproject.eu
In the following pages are presented four (4) case studies, dealing with
business transfer. They are in the press (local newspaper), dry cleaners,
children’s clothes, and kitchen furniture branches.
The tools for presenting the profiles are described in the preceding §,
Tables 2 and 3. Most of the information for filling in these two tables
was collected more through open discussions with the entrepreneurs,
after they had been acquainted with the project, i.e. not by asking di-
rect questions.
21
www.reinoproject.eu
The first case study regards the transfer of ownership and operations of
the local newspaper. The project has been able to discuss mostly with
the transferor (mother). The successor (daughter) had been active in
her university studies and also in setting up a new journal.
Overview
The transferor was polite during the contacts, but a little surprised. This
can be explained from the fact that the local CCI –as she mentioned-
does not have close cooperation with the members. The transferor exp-
lained that she is supporting her daughter for the succession mentally,
psychologically and financially. No especial expectations were expres-
sed from the REINO project.
The situation of the business seems stable. The challenge of the suc-
cessor is –maybe- to create a new vision for the contribution of the two
publications to the local society. The press company owns both the real
estate and the technology of the company.
The lesson from this case study is that the weakness of the local CCI in
service provision to its members should be addressed as soon as pos-
sible.
22
www.reinoproject.eu
23
www.reinoproject.eu
The second case study concerns the transfer of a small dry cleaners
business. The contacts were made with both the transferor and the suc-
cessor. However, finally the focus was on the transferor
Overview
The dry cleaners is an old company with own, long term loyal clientele.
It had been operated for many –some 30-35 years- by a male entrep-
reneur. However the real estate was rented, it belonged and belongs to
a lady. When the entrepreneur grew older, he introduced his daughter
to the job. His daughter worked there for a few months. She got mar-
ried and very soon she was pregnant. At that moment she gave up the
business. The real estate owner asked the ageing entrepreneur to find
a successor so that the business could go on and she could continue
receiving income from the rent.
When the business passed totally to the young girl, the ageing ent-
repreneur stayed on for 3 more months and then he retired. Thus the
transfer of the tacit knowledge was ensured.
24
www.reinoproject.eu
25
www.reinoproject.eu
26
www.reinoproject.eu
Overview
The business was going very well for many years. It was transferred
to the son of the family, who took up business in collaboration with his
then fiancé and later wife. For a while it had some 5 employees, but the
company form changed from SA to ltd.
The family has had two daughters and no son. Both daughters followed
and finished university studies, but none of them was initially interested
in the family business. It is possible that this led to some kind of intro-
version in the business activity.
During the recent years, i.e. after the 1990s, the economy of the area
has changed, and consumers have become more demanding. Little by
little the old family business was losing momentum. It could not emp-
loy many people; its legal form changed once again from ltd to sole
proprietor (personal company). Recently the younger daughter (who
studied business administration in English-language school in Athens)
married an auditor from her ‘family’ town. This proved a motivation not
only for returning there but also for taking up the family business.
The business transfer has been completed during the past year. As she
is no responsible for the family shop, she is being supported by her
mother who is still very active there.
The shop, located in a very central area of the town has good chances
to develop and grow and employ people again. But it needs a good
understanding of today’s market and of the specific branch. This is one
example where specialised experts and support from the local CCI could
prove very crucial, especially as the young successor is still new in the
specific branch –in spite of the fact that she has very good business
development knowledge.
27
www.reinoproject.eu
28
www.reinoproject.eu
29
www.reinoproject.eu
Overview
This business has been going well and expanding. He is married, but no
sons, only two daughters; both daughters have had higher education.
One of them in interested in banking; the other one, studied design,
and has been a born entrepreneur. Before she became involved in the
family business, she established her own shop, selling design female
lingerie. The shop was going well and had no problems. But the yea-
rs were passing and the family business needed to be considered. At
the same time, the design lingerie market in this town was becoming
saturated. She decided to sell out the lingerie shop and become the
successor of the family business. She started working with her father
and the transfer formalities were finalised during the last year. However
she had started taking initiatives with the style of the products that is
promoted and the marketing already when she was in the “business
transfer” phase.
Today, she is working as the new business manager, while her father
is still involved in the business. The challenges that the business is fa-
cing have to do with the market changes in demand, but also with the
problem of finding skilled carpenters in the area. The business has a
very strong local profile –for example, by employing locals rather than
immigrants, and the new manager tries to maintain this profile and the
close connection to the local society.
Evidently, this is business transfer reflects a rare case, where there is,
so to say, in-house confluence of most or all the necessary positive ele-
ments. But this is not accidental: it reflects the structured development
that the company has followed for years and the added value on which
30
www.reinoproject.eu
31
www.reinoproject.eu
32
www.reinoproject.eu
Findings
• Gender barriers:
1. There are entry barriers. They have to do with the values of the per-
son but most importantly with the values of the family and society.
For example, still, today, boys are preferred to girls when conside-
ring the succession of the family business. But this can be explained
also by the women’s attitude who often give up their professional
activities once they become pregnant.
3. There appeared some activity related stereotypes (but not real bar-
riers). For example, a woman is not suitable to do technical work,
i.e. to make furniture herself, confirms a stereotype.
• Educational barriers
33
www.reinoproject.eu
None of the businesses that form our pilot group have benefited of any
special support by their local CCI nor by the national business support
organisation (EOMMEX), nor by the national incentives & development
law. On the other hand, they have benefited from the lately introduced
tax alleviations. The main support has come from two sources: the
lengthy experience, tacit knowledge and concern /commitment of the
transferor in helping the successor, and the practical knowledge of their
auditor/tax adviser. For example, it is important to remember that only
one of the pilots asked practical help from the project.
The pilot action has strongly confirmed the importance of the transfer of
the tacit knowledge, and that this is not an exclusive benefit reserved
for family transfers only. It has also shown that tacit knowledge transfer
depends on the attitude, the mentality of the transferor. It appears that
the transferor is the best mentor. The question is what to do when the
transferor cannot or will not act as mentor. There is where local CCI1:s
could help by setting up mentoring teams in collaboration –maybe- with
their old members.
34
www.reinoproject.eu
• Being prepared
The family transfers were tacitly assumed for decades. In the case of
a transfer outside the family, it took some 1 year to find the successor
and train her on job and transfer the knowledge.
2 BRC:s = Business Renewal Centres, i.e. the special units that Greek CCI:as will set
up to facilitate business transfers.
35
Table 4 Summary of key findings of the Greek pilot action Females as transferors and as successors
www.reinoproject.eu
Branch of Family Why Who Domin- Educa- Mother Education Trans- Role of Business Difficulties Supp- Expectations
economic busi- given to is the ant tion of works of succes- fer transferor situation ort
activity ness the girl trans- person domin- sor proc- after the from
feror? in the ant ess transfer the
family person local
CCI
info consulting
guidance nothing
Local 2 1 child, mother mother uni- yes univer- long strongly surviving market, no
36
news- gene- not a versity sity, term supportive, external x
paper rations boy relevant both within conditions
the business
and outside
Dry no delibe- exter- mother middle yes secon- 1 strongly good, market, no
cleaners rate nal dary year supportive, slightly external x x
outside the expanding conditions
business
Kitchen 2 2 father father self no univer- long strongly good, market, yes,
furniture gene- children, made sity, term supportive, slightly external sub- x x x
franchise rations no boys relevant inside expanding conditions sidies
Childrens' 3 2 father father self yes, univer- long strongly surviving market, no
clothes gene- children, made in the sity, irre- term supportive, external x x
rations no boys family levant inside conditions
busi-
ness
Car 2 no boys father father self no univer- long strongly good, market, no
dealer gene- made sity, term supportive, slightly external x
rations relevant inside expanding conditions
www.reinoproject.eu
Conclusions
Female behaviour in business transfers does not differ very much than
that of their male counterparts. That’s why the recommendations made
below are not meant only for women.
Recommendations
37
www.reinoproject.eu
The BRC:s are at the moment part of the CCI:s and the UHCCI, i.e. of the
public sector. As it has been said many times during the REINO project,
this is a mixed blessing. The CCI:s are not used to provide development
services to their members, while customer oriented approach is not
common yet. Moreover, workshops with KETA representatives (Centres
for the promotion of entrepreneurship) showed that the understanding
of process tools lags seriously behind. So, maybe a first step would be
to describe the qualifications of public sector business support staff and
then reinforce them with training.
The advantages of mentoring are well known, and its key role in tacit
knowledge transmission is well known. However, mentoring is often
discussed but rarely practiced in Greece. Mentoring is one case where
the female and male services can be differentiated. Making a mentors’
registry should be one of the priorities of the BRC:s.
38
www.reinoproject.eu
Greece is one of the very few countries that does not have special fun-
ding tools to facilitate business transfers. This should be addressed and
linked to development actions, so that transmitted businesses are acti-
vely encouraged to not just continue, but mainly to develop.
39
www.reinoproject.eu
4. Selected references
40
www.reinoproject.eu
1 http://www.gender-equality.webinfo.lt/results/european_union.htm
41
www.reinoproject.eu
42
www.reinoproject.eu
43
www.reinoproject.eu
44
www.reinoproject.eu
45
www.reinoproject.eu
for female entrepreneurs neurs who received con- reased their activities
sultancy services due to consultancy
Number of female ent- % of women entrep- % of increased tur-
repreneurs who received reneurs who increased nover due to impro-
advice in the field of pro- their marketing activity ved due to improved
duct marketing due to advice marketing activities in
these enterprises
lunteer mentors with ap- matches between mentor starting their own bu-
propriate skills and mentee siness due to mento-
ring service
frequency and lengths of Rate of satisfaction with % of women with an
meetings between mentor the mentoring relation- improved work life ba-
and mentee offered ship among mentees lance due to mentoring
46
www.reinoproject.eu
Most of these best practice measures and evaluation criteria have been
integrated into the business plan of the Business Renewal Centre.
47
www.reinoproject.eu
5. Bibliography
48
www.reinoproject.eu
49
www.reinoproject.eu
21. CAREER GUIDANCE: A handbook for policy makers, OECD & The
European Commission 2004. (See Section 8 “Expanding access to
career guidance”),http://www.oecd.org/dataoecd/53/53/34060761.
pdf
50
www.reinoproject.eu
Σε εθνικό επίπεδο:
Ανάπτυξη επαφών
και σχέσεων
ανάμεσα στα σχέδια
δράσης για την
αλληλοενημέρωση
και την μεταφορά
εμπειρίας
Υφιστάμενες Υποκίνηση δομών Δημιουργία τοπικών
δράσεις και και δημιουργία συμπράξεων που
πολιτικές από 3ο υποστηρικτικών υποστηρίζουν την
ΚΠΣ και άλλες μηχανισμών «συναντίληψη»
παρεμβάσεις (π.χ.
Leader, Equal,
Καινοτομικά κλπ)
Υφιστάμενα φορείς Συμβολή στην Εκπόνηση ή
εκτός σχεδίου ανάπτυξη τοπικών συμβολή στην
δράσης πολιτικών εκπόνηση τοπικών
αναπτυξιακών
πολιτικών
24. Ισότητα των αμοιβών μεταξύ γυναικών και ανδρών στις συλλογικές
διαπραγματεύσεις, ΚΕΝΤΡΟΥ ΕΡΕΥΝΑΣ ΘΕΜΑΤΩΝ ΙΣΟΤΗΤΑΣ (ΚΕΘΙ-
KETHI), Athens 2002.
51
www.reinoproject.eu
52
www.reinoproject.eu
53