Long-term goals, meet short-term drive
Global family business survey 2019
Today, private companies are faced with promising opportunities and considerable changes: investing in emerging technologies, expanding into global markets, meeting new regulatory requirements, and restyling the workforce. Similarly, increasingly larger and more complex families system, unstable market conditions, changing consumer behaviour, the evolution of business ecosystems and the broader social and political environment are main challenges for the family business. These challenges required the company to maintain that sense of direction throughout their ongoing adaptations to the needs of the day — making sure that the path one chooses still leads to the desired destination.
How are families in business organizing themselves to deal with these challenges? Deloitte’s Family Business Centre polled 791 executives of family-owned businesses from 58 countries around the world. According to the survey results, more than one-half believe their organizations are fit for the future in terms of ownership, governance, and strategy. But most family businesses did not feel confident in the succession plan, long-term strategy formulation and alignment in their goals for the family business with enterprise. We hope that family business and executives may benefit from this year's survey.
Viewpoints / key findings
The main contents of this report as below:
- Based on how respondents’ businesses operate and whether respondents believed their current practices are effective, we found that agility and innovation are perceived as key to sustaining the business. Besides, technology adoption in the workplace is seen as the top issue influencing private company markets.
- In a changing market, ensuring that short-term action meets long-term goals is critical to the success of family businesses. For most respondents, long-term value is more important than short-term results. However, financial performance and growth are still the short-term goals of family business priority in the coming year. Besides, Continuing family legacy and tradition is the top priority for respondents in the next 10 to 20 years.
- Ownership, governance, succession and strategy are four interrelated elements, which are essential for family enterprises to achieve their goals and maintain their long-term development.
- For the formulation of the family business strategic plan, "Zoom out/Zoom in" has been pursued after by successful enterprises in the past decades. According to the market situation forecast in the next 10-20 years, this method formulates corresponding measures that can be taken in the short term of 6-12 months to ensure that its enterprises can still be successful in the market or industry after 10-20 years.