Understanding The Family Business

Chapter 4

Family Business Decision Making

How Families in Business Make Decisions

Although it is of vital importance to a family firm, there is little information on the subject of family business decision making. The most useful information is contained in a single article from Aronoff and Astrachan,¹ who found that 34% of founders made the decisions themselves, 48% of family businesses searched for a consensus, and 6% discussed the issue and took a vote. Fifty-three percent of the voting group is made up of the third generation of family leadership. This suggests a higher level of governance and professionalism among the later generations, accounting for better planning and organizational control.² An increased use of succession planning among ...