Latest research from KPMG in Singapore identifies the challenges facing family firms.
This landmark study of family businesses in Singapore by KPMG reveals several interesting findings about how they see themselves.
While some findings contain new insight, there are some which are less surprising. Preparing and training a successor was the most important challenge for family businesses. Other ‘top of mind’ concerns for family businesses in Singapore included choosing the right successor, resolving potential conflicts among family members and maintaining family control of the business. We have observed that many family businesses did not have a clear succession strategy. They should therefore start planning and grooming their successors early.
However, 9-in-10 participants of the survey indicated that dealing with the issues of running the business was more critical than family disagreements. When asked about the major causes of conflict within family businesses, nearly a fifth cited the competence of family members working in the business. Nearly a third indicated they had no formal processes to resolve conflicts. While they face many challenges, family businesses are also able to count on strengths such as the ability to win business or customer loyalty, opportunities for competitive pricing or strong brand presence.
A significant 9-in-10 considered governance structures to be an important element of the family business. Surprisingly, close to half of those surveyed said their current structure was optimal, with another 29 percent indicating that some minor tweaks might be required. In our experience, many non-listed family businesses are in need of change in this area.family business in singapore