Sociocultural Factors Influencing Adoption of Succession Planning Among Family-Owned Businesses: A Study of Dodoma City Council, Tanzania

Abstract

Family-owned businesses are the most important source of employment and revenue worldwide. Family firms make up between 80% and 90% of private companies globally. The study examines the socio-cultural factors influencing the adoption of succession planning in family-owned businesses in Dodoma City Council. The study employed mixed-methods structured interviews, observation, and documentary methods to collect data. A cross-sectional design was used in the study, and 60 respondents were chosen from a list of registered family companies that were registered. IBM-SPSS software version 26 was used to evaluate the gathered data. Binary logistic regression showed that the chance of adopting succession planning was significantly influenced by gender, age, education level, business experience, and family size (<0.05). The study revealed that most family business owners knew a lot about succession planning. Regarding social and cultural factors. At the beginning of a business, it is determined that socio-cultural elements have a substantial impact on the adoption of succession planning for family-owned businesses. Include sex, age, education level, business experience, and family size. The study concludes that sociocultural factors have an impact on succession planning adoption. Finds that family size, sex, age, education, and business experience all significantly affect family-owned businesses (<0.05). The survey finds that although firm owners are aware of succession planning and have a favorable attitude about it, they have not put it into practice. The study recommends that the government should make sure that family business owners can learn about succession planning and receive training on how to use it. To reach a larger area, municipal governments could hire additional trainers and trade officers.