- Family businesses remain a dynamic and resilient segment
- But competition more intense, price pressures growing, speed of change accelerating
- And succession is more hazardous than ever, with only 16% claiming to have a robust succession process
Family businesses must adapt faster, innovate sooner and become more professional in the way they run their operations if they are to remain successful. These are just some of the findings of the latest PwC survey of 2,378 family business executives in more than 40 countries worldwide.
The report – titled Up close and professional: the family factor – is PwC’s seventh survey of family businesses globally, this year covering more companies and markets than ever before.
Overall, this year’s survey indicates that – despite a tough economic environment, with pressures around skills shortages, innovation and governance – family firms remain dynamic and resilient. Indeed, family businesses account for 70 – 90% of GDP globally, and are an effective barometer of the health of the economy.
One eye-catching finding from this year’s survey is that the need to professionalise the business is gaining ground as a key concern for family firms, driven by an almost perfect storm of competitive pressure, rising costs and global mega trends. It scarcely registered in 2012, but this year 40% of respondents agree this is a key challenge over the next five years. And it must be accompanied by an equally rigorous approach to professionalising the family.
Says Henrik Steinbrecher, Network Middle Market Leader: “It’s clear that there are new challenges; the economy is a colder and harder place for the family firm, competition is more intense, price pressure is growing, and the speed of change continues to accelerate. In this climate, family businesses accept they will have to adapt faster, innovate earlier, and become far more professional in the way they run their operations.”