As 2022 draws to a close, reflecting on the past 12 months provides a lot of food for thought.
Amidst significant political upheaval, there has been a lot to juggle this year. With inflation heading towards double digits for the first time in 40 years, a cost-of-living crisis driving weak consumer spending and a host of challenging supply chain management factors, 2022 is a year many may be ready to close the door on.
But family businesses have continued to show their resilience and appetite to invest and grow for the future. The focus on continuous transformation, cyber resilience, embedding ESG strategies, the future of work and winning the war on talent has shown that family businesses have a unique set of strengths to help them not only weather the storm, but to outpace it.
So how can we prepare for 2023?
Understanding the factors driving economic headwinds, remaining confident in recovery and planning for the future are key. The tight labour market is likely to remain a challenge making it even more important to differentiate your business to retain and recruit talent. In the light of inflation, it will also be prudent to review capital allocation strategies to ensure your investments are generating a positive return.
Succession will remain a hot topic. It’s crucial to stay ahead of competitors by using the regenerative power of multi-generational leadership models and preparing the next generation of leadership to guide your business into the future using new leadership styles.
While family governance systems allow for protection and continuity, it is the inter-family relationships that prove key to unlocking innovation.
I hope you find this edition interesting. If you have any questions or comments regarding any of the topics in this newsletter, or other matters you would like to discuss, please get in touch at familybusiness@kpmg.co.uk.
Wishing you, and your family, a happy holiday season and all the best for the year ahead.
In this edition:
- Planning ahead with the Family Business Leadership Academy
- Helping the next generation drive change
- Three steps to riding out the recession
- Understanding what’s right for the business and the family
- Leadership through the lens
- Keeping the balance in family relationships
Planning ahead with the Family Business Leadership Academy
Ready to take action in 2023? Supporting future leaders with managing issues like sustainability, ESG, diversity and inclusion all while balancing family governance challenges can be a lot to navigate.
The Family Business Leadership Academy, designed in partnership with University of Leeds Nexus Business School, is a 30-week programme that will empower the next generation of leaders to lead their family business into the future. Check out the brochure.
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Helping the next generation drive change
Succession in family firms has never been such a hot topic. Our latest survey found that commitment to family ownership remains steadfast, with just over 7 in 10 family business leaders intending that their children take over the business when they retire.
This change is well underway, with a third of leaders surveyed stepping back earlier than planned. Now is the perfect time to start thinking about the future.
Three steps to riding out the recession
It’s tough out there at the moment. With the cost-of-living crisis driving weak consumer spending alongside rising inflation, and challenging supply chain management factors, there is a lot to juggle.
But what can businesses do to protect themselves?
Understanding the factors driving economic headwinds, remaining confident in recovery and planning for the future are key.
Understanding what’s right for the business and the family
The key to striking the right balance in the family business lies in a family governance model that evolves across the generations. Choosing the right governance practices is critical for long-term sustainability but processes and structures serve different purposes.
So, who’s role is it to govern?
Leadership through the lens
Leading teams in a virtual world is harder. It requires effort, concentration and planning. But, for business leaders passing on their experience gained over a lifetime, it’s an investment. And the return is higher for family businesses.
Keeping the balance in family relationships
Despite the recognition of the importance of open and honest dialogue, family boundaries can undermine the goals that are necessary to drive meaningful discussions and resolve potential conflicts within a family business.
While family governance systems allow for protection and continuity, it is the inter-family relationships that prove key to unlocking innovation.
