Uncertainty, trust and formal governance mechanism in Indonesian family SMEs

*K Kussudyarsana -  University of Muhammadiyah Surakarta, Indonesia
Muhammad Halim Maimun -  University of Muhammadiyah Surakarta, Indonesia
S Soepatini -  University of Muhammadiyah Surakarta, Indonesia
Received: 13 Nov 2018; Published: 30 Jun 2019.
Open Access Copyright 2019 Diponegoro International Journal of Business

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Language: EN
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Abstract
This paper discusses the relationship between uncertainty, trust and the application of formal governance mechanism in Indonesian family SMEs. The data were obtained through survey to 360 family firms in indonesia. This study used factor analysis to validate the construct and multiple regression analysis to examine the hypothesis. The moderation testing indicated that trust moderated the relationship between uncertainty and formal governance was negatively significant
Keywords
uncertainty, trust, formal governance mechanism, Indonesian family SMEs

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