How generational transitions manage digital technology’s introduction while balancing tradition and family values in SMEs

Abstract

This dissertation focuses on how family-run small and medium-sized enterprises leverage their unique knowledge resources to sustain their competitive advantage over non-family firms in the face of digital transformation. In addition, this work builds on the Resource-based-view, Stewardship Theory and Paradox Theory, particularly on the concept of innovation through tradition. This study examines how generational transitions balance the preservation of expertise with the introduction of digital knowledge management systems that promote transparency and sharing. A qualitative study was conducted with 15 interviews with senior and junior executives, including 13 in Austria and 2 in Mexico, in different industries. This approach made it possible to collect a wide range of data to understand digitalization in family businesses. Applying all three theories, these interviews reveal both the facilitators and barriers and how they manage the paradox of maintaining traditional family values while implementing systems that enable knowledge sharing for long-term innovation. The results show that generational dynamics have a strong influence on digitalization in family businesses and offer both opportunities and challenges. While younger managers emphasize more digital innovation, older generations focus on keeping traditions alive. The transfer of knowledge continues to be primarily through personal experience, shaped by close relationships since childhood and transmitted through a practice of “learning by doing”. However, integrating digital tools for process and knowledge documentation is becoming essential. Barriers such as generational risk differences and employee resistance can be overcome through open communication, training and gradual implementation.

Date of Award	5 Feb 2025
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Liliana Brioso Martins de Andrade Dinis (Supervisor)