• Service: Enterprise, Family business
  • Type: Business and industry issue
  • Date: 9/30/2013

Why family businesses need to develop their IT infrastructure 

Need to develop IT infrastructure
Improving the information technology (IT) infrastructure of any family business is an important component of that business’s long-term success. Ideally it’s an ongoing process, ensuring the company is always moving forward in tandem with the technology of the times, and competing in the marketplace in a forward-looking manner.

It’s important that business owners understand the importance of and implement modern and appropriate IT infrastructure to help formalise, integrate, and streamline their business procedures, thereby improving efficiencies, projecting the right image, and enabling sustainable growth.

The importance of having a strategy

Says Don Schwerzler, a prominent family business specialist:

“A family business that wants to grow in size and profitability will not be able to accomplish those goals, in today’s highly competitive business environment, without an ongoing strategy to constantly update and improve their infrastructure.”

To remain current and in touch with modern consumers, family-run businesses need to develop a company culture of innovation and IT proficiency. Companies working without technologies such as Enterprise Resource Planning software (ERP), social media, and interactive websites, among other things, will soon find themselves losing out to competitors who have more customer-friendly processes, a greater web presence, more efficient methods, and faster and steadier growth.

So what are some of the greatest motivators for improving the IT infrastructure of your family business?

Better integrate business processes

The most successful companies – of any type – are those that have effective business processes that can operate independently from the owner. There are hundreds of different kinds of business management software or ERP systems that could be used to help integrate your company’s business processes.

Each ERP solution has different things to offer different types of business, so it would be wise to ask for an audit of your family business to determine the specific software that would work best for you before you choose and implement one.

Improve business efficiencies

You can drastically accelerate your time to value quotient by installing time leveraging IT infrastructure. Perhaps the main hindrance to more family businesses adopting new technologies is that it often takes a fair amount of time to learn the new system, and one could argue for it being time-wasting rather than time-saving.

But just like typing is slow going at first, once you’re proficient, you save greatly on time as it’s possible to type far faster than anyone can write manually. Furthermore, if we accept that successful new technologies will enjoy increasing currency amongst (newer and younger) consumers, then we realise that it will indeed prove time-saving in the end to adapt now instead of digging in our heels and waiting till the technology has developed even further and we have a mountain of catching up to do

Support requirements for growing the business

A family firm can be as strong or as weak as any other company, because by and large, the same make-and-break rules apply to both. Whatever the industry, if a company fails to modernise, it becomes irrelevant. And while a company with old school technologies may grow to a degree, if that growth is not in keeping with the speed with which competitors are growing, then it’s essentially nullified.

Internal systems need to run smoothly and be in keeping with the modern pace of business if lasting growth is to take place, so implementing modern IT within your family company is critical.

Develop your virtual presence

Having a strong presence on the web is important as it not only helps with advertising, but also adds legitimacy to the business in the eyes of many. It’s often the first place potential customers go to in their search for a product or service, so it’s important to not only have a solid presence, but also to monitor and administer that presence well.

With the right IT infrastructure, you can establish a streamlined strategy for promoting your business and managing your online platform.

Bolster appearances

Appearances count. In the same way that certain types of business men and women need to be seen driving smart cars, each car indicative of a certain level of success, the family business, like any other business, requires appropriate IT infrastructure in order to convey the message to clients that yours is a sound, competitive enterprise.

It’s about keeping up with the Joneses’ business, since the image of a company is crucial. Furthermore, when clients see you improving your infrastructure, they read that your business is going well and growing.

In a weak family business, members cling to tradition and find it hard to adjust, resisting the adoption of new information technologies. The strong family business, however, is unafraid of change and embraces new technologies, having the foresight to see that the future rewards overshadow any pains involved in learning and integrating the new.

Christophe Bernard

Christophe Bernard
I am a KPMG partner based in the French firm’s Paris office, responsible for encouraging the growth of our firms’ middle markets practice across Europe, Middle East and Africa, a majority of that market comprises of family businesses.

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