Research On The Control Inheritance Of Chinese Family Businesses

After the reform and opening up for over 30 years, our country's economic construction has made remarkable achievement, the comprehensive national strength and economic strength has increased apparently, all kinds of economic subjects have different degrees of development in China, family enterprises as the economic organizations that started late also have undergone earth-shaking changes. The appearance of family enterprises can not only increase employment for our country, expand import and export, push forward economic development, also they play an important role for academic economics,management theory in providing research object.Nowadays, China's family enterprises have developed a lot, with the first generation becoming old, there is an emerging split in the succession of the right of control, some family enterprises are on the path towards socialization by introducing professional managers, some ones with the psychological of "not letting the opportunities go outsiders Tian" pass the control power to their own family members. While most of the founders of the family enterprises want to pass the power to the next generation by nature, the biggest problems in the sustainable management of family enterprises are the inheritance crisis of enterprises' control power. Therefore, in the matter of choosing the professional managers or family heirs, many founders approach carefully.In recent years, more attention is given to inheritance of the control power of China's family business, but the number of specific theory researches is not so much. Although the related researches in foreign countries have longer time history and bigger quantity than those at home, but as our family businesses are very different with foreign ones in the development environment, development phase and cultural traditions background etc, the reference meaning of the foreign research results to our family enterprises is not so big. Therefore, the academic results that not only make theoretical analysis according to the business theories, but also follow the local family businesses' actual development keeping pace with the times to research the control power are few.The intention of the paper is to further the control inheritance theory of the family enterprise in China, to enrich the theoretical results in this field, to provide the reference for Chinese family business owners to live through the inheritance crisis smoothly. This paper tries to unravel the vicious circle that "rich keeping not more than three generations" in Chinese family enterprises, to discusses why the mainstream inheritance model in China is the mode of "pass the control power to their own children", to analyze the current situation of professional managers market in China and the essence of trust crisis between professional managers and business owners deeply. On this basis, the author think that in order to complete the inheritance smoothly, the Chinese family business owners need to make formulated inheritance plan, need to build trust mechanism between the business owners and managers, need to select outstanding qualified successors as the next generation of enterprise. Meanwhile, the government should also shoulder part of the responsibility for China's family enterprise inheritance.This text is divided into six parts, now the author will introduce each part of the content and writing ideas briefly. The first chapter is the introduction part, mainly introduces the Research Background,Research Significance,research status in domestic theory horizon,research ideas,research methods,innovations and deficiencies. The research of the family enterprises inheritance starts late in Chinese theorists for later start inheritance, meanwhile Chinese family enterprises are concentrating on or will be on the path of shift, so this subject has strong practical significance. In the research methods, this paper adopts a comparative research, game theory, theory with practice method, case analysis method to interpret the article content.The second chapter is part in which the author summarizes the theories and defines the nouns. This article researches the theories of family enterprises,enterprise control,managers,principal-agent theory,control power Inheritance in each stage of development in the basis of referring to the domestic and foreign relevant theories. Chapter three analyzes foreign family enterprises'inheritance and introduces the inheriting characteristics, including Southeast Asia, Japan, America, Europe and other countries and regions. Because of reasons of the late start,small scale,nonsupport in the policy, the development process and development stage of our family businesses have their particularity, therefore foreign theories cannot be used for reference completely. Therefore, this article simply analyzes theoretical results of the control mode about foreign family enterprises, based on this, advances the reference significance for Chinese family businesses'control inheriting.The fourth chapter presents three common modes of in the control inheritance in Chinese family enterprises at present, and then summarizes their characteristics. Based on the analysis of the current situation of Chinese family enterprises, this paper discusses and summarizes the problems and causes of problems in control inheritance model, aims to put forward effective measures to solve these problems accordingly. In the issue of choosing the successor, Chinese entrepreneurs tend to their family, especially the firstborn, because of Chinese traditional cultural factors and other factors like the small scale of family enterprise. From our the whole social environment to see, "steps without other alternative options" pattern in our country is the most common pattern, also it is best choice of most family enterprise owners. Although from the traditional theoretical point of view, family enterprises can guarantee the sustainable growth only when they are on the path of socialization and modern company system. But it had to say, in China's current social environment, most owners are most willing to choose the intergenerational inheritance. Professional managers market are not perfect in our country, the trust mechanism is not sound, the utility function of the professional managers and entrepreneurs is different, they seek maximize their own interests in each other's game. Then, this paper analyzes the reasons of these problems from points of the professional managers, entrepreneurs, heir respectively.The author introduces the targeted countermeasures according the problems existing in Chinese family business inheriting control in chapter 5. An effective and reasonable inheriting plan is indispensable, and it is better that it can be formulated sooner in the process of enterprise development. Although nowadays most business owners in China are willing to choose steps without other alternative options mode, but in practice the mode has many problems. Therefore, the successors'quality problem cannot be ignored, as selection and training qualified successors is important for the enterprise's smooth passing on. In order to expand influence of the model of introducing the professional managers in China, it is indispensable to optimize trust structure and to create good trust mechanism between the professional managers and business owners. At the same time, this paper also analyzes from institutional aspects of family enterprises, and puts forward the responsibility that the government should assume in the process of inheritance.At last, the paper introduces the ideal inheritance model on the base of analyzing Chinese family businesses——giving consideration to both interior and exterior, but the interior is prior than the exterior.