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Pyrex Journal of Business and Finance Management Research

September 2016 Vol. 2(8), pp. 89-96

ISSN: 2985-8860

Copyright © 2016 Pyrex Journals




Full Length Research Paper


Family Conflict and Sustainability of Family Owned Businesses in Lagos and Ogun States, Nigeria


ADEDAYO, S . Oludare1 and OJO, J. Olanipekun2*

1Department of Business & Marketing, Babcock University, Ilishan-Remo, Ogun State, Nigeria.
2Department of Business Administration, McPherson University, Seriki Sotayo, Ogun State, Nigeria.

Corresponding Author E-mail: lanipekunojo@gmail.com

Accepted 15th September, 2016



Abstract


Family businesses constitute a large number of commercial activities worldwide, contributing significantly to the global economy. Family Conflict is a key issue influencing the sustainability of family businesses. There are many family business failures in Nigeria, especially at the demise of the owner/founder. This study investigated the factors that are creating conflicts and how they affect the sustainability of family businesses in Lagos and Ogun States of Nigeria. The study adopted a survey design with a population of study limited to the family business owners who are members of the National Association of Small and Medium Scale Enterprises (NASME). A stratified sampling technique was used to select the family businesses, from where a random sample of 327 was selected. Pearsonís Product Moment Correlation and Multiple Regression were used to analyze the data. The results revealed that there was a strong positive correlation between family conflict and firm's sustainability, with an r value of correlation coefficient of 0.86 and significant level of P<0.05 @ 0.000. Issues that can create conflicts should be avoided like appointing an incompetent successor, while the successor should be made to come into the family business early enough to gain the confidence and respect of other family and non-family workers. Potential entrepreneurs should be educated on the dangers inherent in polygamous marriages as this can affect business succession plans; there should be clear communication with both the family and the nonfamily employees that the succession is taking place and to offer incentives to the prospective successors so as to ensure their cooperation.

Keywords: Family Business, Succession, Sustainability, Family Conflict.

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