City Research Online

Abstract

Founder-led family businesses rely heavily on founders’ tacit know-how yet struggle to convert it into organizational capability as they professionalize. In this study, we ask how founder know-how crosses family and role boundaries and becomes embedded in routines that endure beyond the founder. Drawing on an inductive study of ten Egyptian founder-led family firms, we show that founder knowledge initially flows through selective, relational exposure that preserves control but creates bottlenecks during succession and growth. Dependence declines when firms develop internal absorptive-capacity routines that allow non-family managers to assimilate founder know-how. These routines are enabled or constrained by trust, participative leadership, and governance choices that balance openness with protection. We synthesize these insights into a stock-and-flow framework that builds on the idea of absorptive capacity in founder-led businesses as an internally directed process of translating founder know-how into organizational capabilities.

Publication Type:	Conference or Workshop Item (Paper)
Additional Information:	© Academy of Management Proceedings. This is the accepted manuscript of an article published by Academy of Management. Please refer to the publisher’s terms and conditions for information on re-use.
Publisher Keywords:	AOM Annual Meeting Proceedings 2026, AOM Philadelphia 2026, Organization and Management Theory
Subjects:	H Social Sciences > HB Economic Theory H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
Departments:	Bayes Business School Bayes Business School > Faculty of Management
SWORD Depositor:	Symplectic Administrator

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