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Family leadership succession and firm performance: The moderating effect of tacit idiosyncratic firm knowledge
Author(s) -
Williams Ralph I.,
Mullane John
Publication year - 2019
Publication title -
knowledge and process management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.341
H-Index - 44
eISSN - 1099-1441
pISSN - 1092-4604
DOI - 10.1002/kpm.1594
Subject(s) - tacit knowledge , extant taxon , business , ecological succession , industrial organization , transaction cost , database transaction , marketing , knowledge management , perception , microeconomics , economics , psychology , finance , computer science , evolutionary biology , neuroscience , biology , programming language , ecology
The expression “clogs to clogs in three generations” illustrates the widely held perception that family business performance wanes with each generation of intrafamily leadership succession. Hence, family businesses would benefit from a better understanding of practices that help prepare potential heirs for leadership succession and, thus, improve postsuccession firm performance. Specifically, this paper proposes that the transfer of tacit idiosyncratic firm knowledge moderates the relationship between family leadership succession and firm performance. The resource‐based view of the firm and transaction cost economics is utilized to theoretically explain the nature of this relationship. Processes that potentially enhance the transfer of tacit idiosyncratic firm knowledge, particularly in family firms, are presented from extant literature.