Family businesses should trust in next generation leaders to thrive in digital age according to the latest research. Family business NextGens view themselves as agents of change for digital transformation but are looking for greater support and trust from current generation leaders, according to a new report by PwC.
PwC’s Global NextGen Survey 2019 has found that a majority of NextGens are already deeply engaged in the family enterprise, with nearly half (48%) reporting that they already run significant internal operations. A quarter (26%) are already in an executive director position.
This level of engagement is also matched by future ambitions to lead, with 41% seeking an executive director role within the next five years and nearly a third (29%) looking to be a majority shareholder.
Confidence is also high amongst NextGens about the value they can bring in terms of skills. Over two-thirds of respondents see their strongest attributes (problem-solving and leadership) to be essential skills in the future business landscape. 64% say they can add value to ensure future business strategy is fit for the digital age.
Peter Englisch, Global Family Business Leader, PwC Germany says, ‘The survey findings highlight the positive news that NextGens are ambitious and deeply committed to the family business. They see a clear role in securing the family legacy in an age of profound disruption and transformation. Yet they also see themselves as being held back and frustrated by a lack of opportunity.”
‘We should recognise, however, that these frustrations are realistic and pragmatic. What NextGens are looking for is support in terms of developing the expertise and experience they need to succeed. Their view can be summed up as: “Help me unlock my potential so I can gain the skills and experience I will need to take on the leadership roles I aspire to.”
“They are a diverse group in terms of their needs and ambitions. NextGens require an approach that is built around understanding their needs and ambitions and this survey provides an important guide to the next steps they should take.”
The survey identifies four key personas of NextGens, based on their views of their skills, contributions and career goals. These personas are:
Transformers: Self-confident future leaders
(46% of respondents)
Transformers aim to lead change in the family business and are more likely to aspire to executive roles within five years (56% of transformers said this vs. 41% of all 956 respondents)
Stewards: Keeping to tradition and existing networks
(26% of respondents)
Stewards are more likely to be over 35 than other NextGens (42% vs. 36% of all respondents) and to be in a management role (44% vs. 39% of all respondents).
Intrapreneurs: Proving yourselves by running ventures under the family’s wing
(20% of respondents)
Intrapreneurs are more likely to feel the need to prove yourself before presenting ideas for change
(27% vs. 21% of all respondents).
Entrepreneurs: Following your own path outside the family business (8% of respondents)
Entrepreneurs are less likely to see themselves as future leaders of the family business — though they want to lead their own business — and are more likely to aspire to a governance role in the family business (for example, on the family council).
The survey provides specific guidance for each persona in how they should approach their professional development.
Vicki Huff Eckert, US and global leader, PwC New Ventures says, “It’s vital to understand the importance of a cross-generational approach. In some family businesses, there may be up to five generations all working together in one company. Each generation tends to have characteristics that can clash with those around them — but they also have insights, experiences and skills that can benefit the business.”
“Weaving in the best traits from each generation — knowing when to let the young take the lead and when to rein them in — can make the difference between simply surviving and passing on a thriving enterprise to the next generation.”