Southeast Asia with its historical concentration of ethnic Chinese remains an important economic hub encouraging cross-disciplinary inquiries on themes relating to businesses. In industrialising Malaysia, there is little research on their capacity to develop tacit knowledge of the founding generation mostly inherited from China, before starting a business in Malaysia. This assessment of four thriving Malaysian Chinese family SMEs in food production evaluates how a new generational change has innovated their traditional food products. Interestingly, tradition may enable these Malaysian Chinese firms to innovate by building on more reliable knowledge and resources, extensively validated over time, and hence reduce development and utilisation costs. The well-trained second and third generations have been innovating tacit knowledge to elicit strong and positive feelings of ‘Chinese’ identity, increasing the value of new products through R&D by embedding past knowledge and facilitating the legitimacy of innovative functionalities and obtaining market acceptance.
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