Assessing ethnic business sustainability in transgenerational succession

Abstract

PurposeThis paper aims to examine the impact of changes in human capital development and evolution of tacit knowledge following transgenerational succession in ethnic companies. The paper contributes to the understanding of transferring tacit knowledge across generations in ensuring ethnic business sustainability.Design/methodology/approachIn answering the how question, this paper tracked the changes and their impact in the process over time, using the multiple-case study method. A total of six interviews were conducted with three Indian-owned companies in the jewellery industry in Malaysia, with each interview lasting between 45 and 60 min. Secondary data were collected to supplement the primary data for analysis. Data triangulation method was applied to strengthen the design of this study.FindingsThe results indicate that changes in human capital development and tacit knowledge have enabled ethnically Indian-owned jewellery-based companies to alter their products to respond to demands of modern society whilst sustaining and commodifying the ethnic identity of their businesses. The findings also highlight that proper succession planning by ageing entrepreneurs may promote sustainability of these ethnic enterprises.Originality/valueDespite the growing attention on ethnic and migrant entrepreneurship, less is known about the impact of the changes through transgenerational succession over time in ethnic businesses, especially when such changes involve human capital as the key players. This study is important in addressing the gap, in identifying human capital development and tacit knowledge among the critical ethnic resources contributing to ethnic business sustainability. Using a conceptual framework, this paper sheds some light on how ethnic businesses are sustained through transgenerational succession.