Strategic decision-making processes in family businesses: The founding shareholder’s power play

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Abstract

This article proposes to understand strategic decision-making within family businesses (FBs), with particular emphasis on the role of the different stakeholders in this decision-making. For this, we carried out a qualitative casuistic study. The convenience sampling method enabled us to constitute a sample of eight cases of FBs, with which we conducted semi-structured interviews. Thematic data analysis was made with the content of these interviews. The results obtained show that the decision-making process is not identical within the FBs. However, it remains a power play controlled directly and at different levels by the founding shareholder and indirectly by the members of his nuclear family. This process differs from the model of Fama (1980) and Fama and Jensen (1983) either by the size of the process and the intertwining of roles (Model 1) or by the level of involvement of the nuclear family in the process (Model 2). This article highlights the permanent involvement, formal and/or informal, of the family in the decision-making process and the need to encourage the establishment of a code of governance specific to these FBs.

Keywords: Decision-Making Process, Family Business, Family Governance, Cameroon

Authors’ individual contribution: Conceptualization – J.R.F. and G.K.; Methodology – J.R.F., G.K., and F.Z.; Validation – J.R.F. and F.Z.; Investigation – J.R.F. and G.K.; Formal Analysis – G.K.; Writing – Original Draft – J.R.F., G.K., and F.Z.; Writing – Review & Editing – J.R.F. and F.Z.; Visualization – F.Z.; Funding Acquisition – F.Z.

Declaration of conflicting interests: The Authors declare that there is no conflict of interest.

JEL Classification: D23, D70, G30, L22, M12

Received: 20.01.2021
Accepted: 26.03.2021
Published online: 29.03.2021

How to cite this paper: Feudjo, J. R., Kakti, G., & Zogning, F. (2021). Strategic decision-making processes in family businesses: The founding shareholder’s power play. Corporate Ownership & Control, 18(3), 149-160. https://doi.org/10.22495/cocv18i3art12