Tacit Knowledge and Decision Making Practices in the Context of Family Businesses.

Abstract

Decision-making practices in family business are crucial and usually involve several stakeholders. To determine the decision-making mechanism in the family business, qualitative research approach was carried out. 30 semi-structured interviews were conducted involving family owners and non-family managers. Thematic analysis was used to analyze data. Three themes such as Business sense, consultation with elders, and ceremonial approval of the board were generated. Study reveals that decision-making is informal and based on tacit knowledge. Study emphasizes the codification of tacit knowledge, the codification will make decision-making more formal and institutionalized.