Loss and Post-founder Business Discontinuity among selected Indigenous Private Enterprises in South-West Nigeria

Abstract

The survival of indigenous private enterprises is usually threatened by the demise of their founders. While previous studies on enterprise (dis)continuity have focused largely on business failure before founders’ death, little attention is paid to why indigenous private businesses do not outlive their founders in Nigeria. This study, therefore, examined the factors accounting for post-founder business discontinuity among selected indigenous private enterprises in the South-West, Nigeria. Theory of Loss and continuity in the family firm provided the framework. The research design was exploratory, using qualitative methods of data collection. Three states (Lagos, Ogun and Oyo) were purposively selected on the basis of being home to many defunct indigenous enterprises. Case studies were done on 16 purposively selected indigenous private enterprises (eight discontinued and eight surviving) whose founders had died. The qualitative data were analysed with Nvivo 8. Findings show that disharmony in the deceased founders’ family, ineffective implementation of succession plans as well as inheritance crises emerged as the most prevalent factors that accounted for postfounder enterprise discontinuity. The study recommended that indigenous enterprise founders should make efforts to foster harmonious relationships among members of their families in order to increase enterprise survival after their death.