Budget and life cycle in family business in succession process

Resumen

The aim of this work is to analyze how the budget need is conceived in family businesses in the process of succession. There is a gap about the reasons for using the budget in the context of a family business succession process, whose characteristics and purposes of the budget reflect their need depending on the antecedents the reasons for use. The relevance of the theme lies in understanding the intergenerational succession as a part of the life cycle in family companies and the interface with the management control system (MCS) from the need of the budget with a planning and control tool. As an impact on the area, this study broadens the field of research on budget considering its characteristics and purposes in a context of organizational transition that involves succession in a family business. We adopted the single case study with data collected through semi-structured interviews, observations, and documents. Data were analyzed from the discursive textual analysis whose focus is the contents related to succession from the organizational life cycle, changes in the MCS, and budget need. The results showed that changes resulting from the succession process on the strategies of its planning (professionalization of management, creation of the holding company, and governance) interact and influence the need of the budget. This stems from the reasons for operational planning and strategic training from its antecedents associated with the organizational characteristics of the success and renewal phase of the life cycle. The contribution of the study is based on the combination of succession in family business and budget by making it possible to reflect on the need for a specific tool (the budget) to support goal setting and decision-making in this context. It will contribute to the MCS and family business by understanding the need for budgeting in the succession process. In addition, it will validate the three-phase model of the succession process in a family business as part of the organizational life cycle.