AN INVESTIGATION INTO THE DECISION MAKING PROCESS IN VENTURE CREATION: A COMPARISON BETWEEN FAMILY BUSINESS AND NON-FAMILY BUSINESSadmin
This exploratory study was to investigate the differences between family business and non-family business in the decision making process when creating ventures. How, why, and possibly for whom are these decisions made for; and further explored on how different the decision making process is between family business and non-family business. The research involved a deep investigation into three family businesses and compared it with one non-family business in several cases of decision making on substantial investments.
The interviews were carried out over nine months. The findings of the study proved “why” the patriarch created the ventures. The reasons were not solely for business growth but the priority was for his family, i.e. “what they want for the family, rather than what they get from the business”. The substantial contribution of the study is “how” the mode of new ventures (new venture managed by family managers vs. new venture managed by non-family managers) was decided upon based on the philosophy of the patriarch, his motivation, the speed of decision making process, the level of permissiveness and the perceived trust within the family and employees.
This study also contributed in developing an emergent theory and model of the decision making process in venture creation within a family business, therefore, promoting the theoretical development in family business research. The boundary of the research is within the “intangible” component of the resource-based view (RBV) and is limited to the perspectives of the founder in his decision making on venture creation. The emergent theory deserves foremost attention for future theory testing to validate the theory and this would certainly add scholastic value in the field of entrepreneurship, specifically, in the area of family business.