Through shared values and ethos, and guided by a long-term and consistent approach to strategic planning, embraced by a committed workforce, family firms are able to be more adaptable and resilient to market conditions and therefore consistently and productively deliver superior service and product to their customers.
Balancing family and business issues
The biggest challenge seemed to be in balancing family and business issues, followed by maintaining family control of the business, and then preparing and training a successor. And while family firms share common challenges, individual businesses will face their challenges and issues at different times depending on their business life cycle and their ownership life cycle.
40% of respondents stated that they had experienced no conflict within the business over the previous 12 months, and those that did experience conflict reported the following as the top five sources of conflict:
- vision, goals, and strategy
- how decisions are made
- managing growth
- financial stress
- competence of family members.
Family issues and business performance
Many respondents viewed family issues as having an ‘equal’ or ‘greater’ influence over family business performance than business-only issues. The survey also revealed that family companies with formal advisory boards and business planning processes performed better compared to those that didn’t.
Perhaps most concerning is the unpreparedness of family enterprises with no explicit unifying strategy for the future of the business, no plan in place for appointing a new CEO, no plan for ownership transfer, and no plan for preparing/training a successor.