The choice of information and knowledge resources for financial decision-making : case of Greek shipping companies

Shipping companies, which are operating in a particularly volatile and risky environment, rely on effective knowledge management to remain competitive. Success in the shipping industry is greatly related to financial decisions. However, financial decision-making in the shipping market is demanding, not only because of the context of high uncertainty and market competition, but also in terms of the vast amounts of capital involved. Effective knowledge management processes offer the opportunity to exploit knowledge and information to the benefit of the firm’s overall performance and, in particular, to the improvement of decision-making. This research intends to link the principles of knowledge management with organisational decision-making. Thus, by first examining the preferred types of information resources to inform financial decisions, this research also highlights the importance of embedding knowledge management practices into the organization with a view to improving decision-making. This research explores what types of knowledge and information resources senior managers of Greek shipping companies prefer to use, so as to inform their financial decisions. The purpose of this research is, firstly, to identify the preferred types of knowledge and information resources for managers making financial decisions. More specifically, this research investigates what factors (such as demographics, or the characteristics of the resources themselves) affect the choices of managers in this respect. Finally, this research examines whether the behaviour of managers towards knowledge and information is active, in the sense of actually searching for and making use of knowledge and information resources, when they make financial decisions. The role of knowledge management practices with regards to organisational decision-making is also evaluated. To determine the use of knowledge and information resources in the financial decisions of managers of Greek shipping companies, 49 semi-structured, face-to-face interviews in total were conducted with managers of shipping companies operating in Piraeus, Greece, as part of a multiple-case-study methodology. Senior managers were interviewed with a view to exploring potential trends in their decision-making styles, especially concerning their preferred types of knowledge and information resources. The analysis of data was based on a qualitative approach. The findings of this research made a particular contribution by distinguishing the information-resource preferences in the shipping industry. Results show that, senior Greek shipping managers prefer using both written and verbal sources of information, as well as personal and impersonal resources, depending on each case. Additionally, this research identifies that important criteria determining the value of an information resource are trustworthiness, ease of use, accessibility, specialization and exclusivity. This research indicated that demographic factors like educational background and working experience influence the use of knowledge and information resources. In parallel to that, managers’ personality characteristics such as patience, self confidence, risk tolerance, being a good listener and having no egoism contribute to make more effective decisions. Finally, the research findings confirm the managers’ active engagement in information seeking in order to make informed and effective decisions. In effect, the results suggest that managerial decision-making is a combination of data, past experience and intuition. Additionally, this research makes recommendations for enhancing managerial practices in the shipping companies through the use of knowledge management tools and processes