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Next-generation family businesses

Exploring business ecosystems

Next-generation family businesses: Exploring business ecosystems, a 2018 global study by Deloitte Private, polled 575 current and future family business leaders to investigate their attitudes and actions with respect to the business ecosystems in which they participate.

2018 Nextgen survey results in a snapshot

Ecosystems offer opportunities for growth and innovation

  • A large majority (89 percent) of the survey respondents agree that business ecosystems enable their organisation to innovate beyond its individual capabilities
  • However, more than half (53 percent) rarely or never partnered with other organisations the past three years.
  • One third of the respondents said that their businesses would only work on new services and/or products with organisations with which they already had a long-standing relationship.
2018 Nextgen report

Third-party interactions have increased, with innovation a key goal

  • Sixty-five percent of next-generation family business leaders have increased their interac­tions with third parties over the past three years.
  • They interact most frequently with customers of their customers, 42 percent of respondents say that they also interact with competitors on a weekly or monthly basis
  • Most are used to working in partnerships for innovation:
    • Six percent always partner with others on innovation, and 37 percent do so often.
    • Forty-nine percent will work with any orga­nisation that has a good idea.

Leaders value asset and intellectual property (IP) ownership, which may drive a preference for acquisitions

  • Next-generation family business leaders are in­clined to be possessive about IP.
  • Acquisitions were the most frequent type of transaction for expansion.
To fully exploit the opportunities presented by modern business ecosystems, next-generation family business leaders should consider adopting a flexible, outward-facing mindset that allows for variation in the types of relationships they pursue,
Nikolaas Tahon, Managing Partner Deloitte Private

 

Leaders may need to educate their families about the potential for digital transformation

  • Twenty-six percent of respondents have a strat­egy for digital transformation solidly in place; another 35 percent said that their digital strat­egy is fairly recent.
  • Digital awareness among next-generation family business leaders is high, but other family mem­bers may not be as cognizant of the opportuni­ties that digital technologies can bring. 
Most of the leaders are aware of the need for change, even though some may not yet realise the extent to which changes might be needed. They would do well to consider how their business model can work effectively in an evolving business ecosystem, without neglecting the history and traditions embedded within the family.
Nikolaas Tahon, Managing Partner Deloitte Private

 

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