This year only 7% of our respondents cited technology as a key challenge in the next twelve months, and technology and digital only feature in the list of top priorities for the medium term on a prompted basis (taking fifth place, at 47%). This is clearly a concern, especially when a third of respondents think family firms are less open to new thinking and ideas than other companies, and only 40% believe they’re willing to take more risks than other firms. And perhaps most telling of all, only one in four say they feel vulnerable to digital disruption, and only 54% have ever discussed this at board level. Alfred Peguero, Family Business Leader, PwC US, cautions: “Every business is vulnerable in some way to digital disruption, and those who think they are immune will soon find out that this is not the case. I see this as a threat which is facing all businesses and individuals, no matter their geographical location, industry or size.”
As we discuss later, digitalisation is an area where the next generation could have a significant part to play. Many of them have grown up with new technology, and are keen to employ it when they take over. 59% of the current generation believe they understand the tangible benefits of moving to digital but 37% of the next generation say they struggle to get the business to understand the importance of having a digital strategy, and this rises to 43% in smaller family firms.
As we have observed many times, the most innovative companies are invariably those which are open to new ideas and new ways of working. Having a more diverse and inclusive workforce is a considerable advantage here, but being able to not just manage change but thrive on it is even more important. As Nishant Arya, Executive Director of India’s JBM Group says, “In our family, we say nothing is permanent except change. And we like it that way.”