Singapore family businesses positive but need plans: Survey, Latest Business News - The New Paper

Singapore family businesses positive but need plans: Survey

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While family businesses here are optimistic about growth and are keen to keep the business in the family, few have a robust succession plan in place, unlike their global counterparts, a survey released yesterday showed.

About 89 per cent of Singapore family businesses surveyed expect to grow in the next two years, compared with 84 per cent in both the Asia-Pacific and globally, said the Global Family Business Survey 2018 by professional services firm PwC.

They are involving members of the next generation at higher rates in leadership teams (63 per cent versus 48 per cent in the region and 43 per cent globally) and senior executive roles (53 per cent versus 38 per cent in the region and 36 per cent globally).

But they fall short when it comes to succession and mid-term planning. Only 8 per cent have a robust, formalised and communicated succession plan in place, compared with 12 per cent in the Asia-Pacific and 15 per cent globally; and 34 per cent have a costed, formalised and documented mid-term plan, versus 43 per cent in the Asia-Pacific and 49 per cent globally.

"The biggest challenge standing... is the lack of formalised processes in areas of mid-term strategic planning," said Mr Ng Siew Quan, Asia-Pacific and Singapore entrepreneurial and private business leader at PwC.

"This is also tied to their strategic competencies including mitigating risk and challenges, digitalisation and innovation, and succession planning. The disconnect is quite concerning, but it also sends a clear signal to family businesses in Singapore on what can be concretely done to mitigate these risks."

The survey found the top three challenges such businesses here face are the need to innovate, economic environment and international competition, highlighting the open nature of Singapore's economy as an added dimension of complexity.

The top challenges cited globally are the need to innovate, accessing the right skills and capabilities and digitalisation. - THE STRAITS TIMES