Family businesses often have a strong sense of loyalty their workforce and, in many ways, behave like an extended family. In our recent CEO survey less than half of the UK heads of family businesses surveyed expect their headcount to grow over the next 12 months. In other organisations this could point to concerns over growth in the near future but for family businesses it’s more likely to be a result of retaining their staff through the last economic downturn. If the case, they will now be reaping the benefits of being able to scale up quickly with an experienced, loyal workforce who get the culture and values of the business.
Similar to other UK CEOs surveyed, availability of key skills impacting growth was identified by UK family business CEOs as their top concern. When asked about their people strategy in a digital age, only 27% of family business CEOs believe there is difficulty attracting digital talent whereas 55% are concerned about the digital skills gap in their own workforce. 70% of them felt responsibility to retrain employees whose tasks and jobs are automated by technology compared with just over half of UK CEOs. Clearly keen to prepare their people for the digital age, 94% of family business CEOs surveyed agreed they needed to strengthen soft skills alongside digital skills. As one CEO pointed out:
“Leadership skills can be learned, but it requires investment, and we invest in assets and processes and all that but I think the strongest thing to invest in is people because it's actually people that make things happen.”
Common to all the CEOs surveyed, family business CEOs continue to build trust with their workforce through transparency over a range of issues. One exception is they are less likely to have discussions with their workforce about the impact automation and AI will have on their businesses in the future with half of family business CEOs stating it was not part of their plan to build trust, which was only the case for a quarter of CEOs globally. Getting ready for the digital age will be different for every business, for some technology is already part if what they do as one CEO surveyed commented:
“We encourage people to keep up to date with tech and get excited, just as we do, about the new tech that's happening and what's happening around it”.
For other family businesses it was clear they are looking to their next generation (the digital natives) to lead on digital.
"I think finding where technology adds value and not being overwhelmed by it is something that, as individuals, we have to learn to do. We argue with our kids, you can’t bring your phone in here. They say, you’re out of touch. This is what everybody does."
In our recent Next Gen survey, 56% of next gens are already playing a key role in this area. 75% of them have big plans for taking the business forward though only 15% think their business currently has a clear plan for innovation. Raised in the culture and values of the company and more comfortable with emerging technologies, the next generation are well placed to navigate a digital world. To help continue the family business legacy next gens will need the space to pursue their own ideas and be given the chance to take on responsibilities. They will need to be listened to and current senior management commit to their long term development.
Family businesses value their people and are willing to invest time in developing their skills to adapt to a digital world. They may often have low staff turnover and a loyal workforce who understand their culture and values. Relying on the next generation to help them adapt to a digital age and deliver their legacy they may feel they need only focus on the business they know. This is not the case. A digital age demands growth in ways family business CEOs have not yet experienced and they will need to think hard about how they maintain the culture and values of their business through the transition.