Knowledge management in Oil&Gas Family Firms: a comparative case study.

Structured Abstract - As a strategic resource, Knowledge management has acquired great importance for business development and is a critical element in enabling companies to obtain new sources of information. In family businesses, knowledge management becomes a crucial element in running the business. Family businesses are characterised by a high level of involvement in entrepreneurial activity. This characteristic can represent both a competitive factor and a negative element. It is not easy to find the right line of conduct in business management, and it is not always easy to value the knowledge possessed. This paper is a comparative case study between Smape Ltd and ITF Geoenergy. Purpose – Based on the analysis of family firms, considering their structure and the role played by the family in the company, the work aims to understand how family dynamics affect corporate knowledge and its management. The Oil&Gas industry, characterised by the presence of many global companies, can complicate the life of a family firm. The significant difference in size and company structure can represent an element of “difficulty” for firm competitiveness. However, if adequately exploited, these same elements become a peculiarity and an added value for the company, making it a flexible system. Knowledge, therefore, and not size, becomes the element that makes the company great. Business growth is strictly linked to the efficiency of Knowledge management, development, and transfer efficiency, both within the family and the company. Its efficiency is the base for business success on the market or its debacle. Design/methodology/approach – We propose an empirical approach. The work, starting from examining the main theories and contributions of national and international literature on family businesses, knowledge management and the Oil and Gas business, focuses on the study of the case studies of Smape Ltd and ITF Geoenergy. For the case studies analysis, in-depth interviews with the sole director and top management were carried out. The interrogation focused on the company’s development strategies, its birth, the composition of the ownership team, and the family’s involvement. We have been provided with a lot of sensitive data relating to the economic and financial performance of the firm. Originality/value – While the importance that the Oil&Gas sector plays in the national and world economy and the role of family firms in the Italian economy, this paper aims to provide a different “interpretation” of small businesses and their importance in the national and international economy. Naturally, this analysis highlights the fundamental role of knowledge and its management and the dynamics linked to the transfer of knowledge created in business management. As we know, the head moment of knowledge transfer in family firms coincides with the generational change in the vertex: this work compares the administration of this moment in two companies belonging to the same business/family group, in which the succession had very different outcomes. Practical implications – The study highlights the Oil and Gas companies’ uniqueness because their nature is closely linked to subsoil resources and their exploitation. For this reason, even when the companies are small, they have to compete with much larger enterprises and be part of larger economic structures, such as, for example, the oil districts, precisely to achieve their development goal.