Family Businesses: Skills Shortage More Worrying than Cash Flow
A recent survey by PwC and a separate report by the Institute for Family Business (IFB) suggests that skills shortages are a bigger concern in family businesses than cash flow. The IFB believe that this is due to “unintended glass ceilings” – which can worsen the situation of skills shortages in family businesses.
PwC – which surveyed over 1600 small and medium sized family businesses across 35 countries – found a number of other potential threats to family businesses.
According to the results, almost a quarter of family firms in the UK anticipate a change of ownership in the next five years, and the majority of recipients also expect their businesses to fall out of family control.
The findings suggest that many family businesses are also failing to prepare succession plans. Of the 100 UK businesses surveyed, 32% said they did not have any succession plans.
Among those issues highlighted by the IFB are preferential treatment within the family, which it says must be avoided, but equally talent in the family should be retained and succession managed well.
The report also states: “At the other end the danger is that senior family members will cling to their appointments longer than will be beneficial to the business. Good succession planning is therefore not only planning who in the next generation should enter, and when, but also when seniors exit.”
Find out more about the IFB online at www.ifb.org.uk.