The digitized entrepreneur family.
From the research workshop. Why does digitization become a success story for one family business? Und with the other one she only makes frightening slow progress? The key is in the family. Den Owners, their digital knowledge and skills and especially their inner attitude are of central importance with regard to questions of digital transformation.
Tradition, it is said so beautifully, is not the worship of ashes, but the transmission of fire. If tradition and digitalization are to come together in family businesses, owners need the courage to ignite a new flame.
Exactly this works very differently in family businesses. Our research shows that wherever the owner side vehemently demands digitisation, actively promotes it and is clearly committed to it, the digitisation processes in the company progress much more comprehensively and quickly. This often leads to a multitude of innovative process optimizations and product ideas, including new business models.
On the other hand, even companies that have been successful and world market leaders for many years are facing the disruptive dangers of digitalization alarmingly slowly or inconsistently. The reason for this seems to be the "digital readiness" of the entrepreneurial family. By this we mean the degree of understanding and competence within the owner family as well as the inner openness. Is it prepared to question all existing structures and business models of its own family business and to replace them with new forms of value creation and product/market concepts? And with what intensity are opportunities and dangers discussed and reflected upon within the family? The answers to these questions decide whether or not a dynamic of digitization will unfold.
If the family-internal confrontation with this topic is rather determined by feelings of threat and fear of loss and if it is evaluated rather sceptically and from a risk perspective, in most cases good concepts cannot be implemented by the managers outside the family or only inadequately. They ultimately fail with their proposals due to a lack of know-how and imagination within the circle of owners.
In the context of a digitisation strategy, it seems to be a decisive factor that the entrepreneurial family itself is convinced of the digitisation measures and can actively participate in them. The mere provision of a budget for investments in digitisation measures is not sufficient. Rather, the entrepreneurial family must have a basic competence in the field of digitisation. It seems to be of essential importance that a structured systematic dialogue is established within the circle of owners beyond the mere accumulation of knowledge on this topic.
In the case of successful companies, it can also be stated that they regard the topic of digitization as a fundamental strategic question, and that the circle of shareholders must also devote itself specifically to it. Based on this insight, measures and structures are established which lead to at least one family member developing as a competence bearer in the context of digitisation. In his role as the "digital champion" of the family, this person then deals with the strategic implications of disruptive changes in the business model. It not only supports corresponding campaigns and projects in the company, but also actively accompanies them. This participation in corresponding change initiatives then also makes the high significance of these activities visible for all employees in the company.
Conversely, for the managing partner or the established representatives of governance, this means "depatriarchalizing" digital competence. It is their task to actively ensure a digital affinity within the circle of owners. Corresponding measures can concentrate on one breiteren Adressatenkreis . Also in demand are previously non-active shareholders, spouses of shareholders and representatives of the next generation.
At present, a large number of classical generation conflicts can also be observed, which are proving to be an obstacle to digitisation. For example, we are noticing more and more that the next generation (NextGen) is working on the insufficient willingness to change or the lack of understanding of the senior generation and their consultants. While NextGen has often grown up digitally, the older generation is sticking to the existing business model and the established organisational and relationship structures and overlooks valuable alternatives. The development of new digital business models thus lies in the hands of the operating family members, or the top managers outside the family, who have long acted in the pre-digitized environmental dynamic. In these cases, the existing digital skills and competences from NextGen are rarely integrated systematically and if so, only insufficiently. This leads to frustration and leaves valuable potential untapped. In principle, therefore, the topic of digitisation should be part of the basic competence of a shareholder and should be developed in a tactical and structured manner within the framework of shareholder competence development.
In the event of an operational succession by a family member, this member should be specifically integrated into the implementation and development of the company's digitization strategy. In addition, preparations for an operational succession should be structured differently in the future. Instead of building up management experience in external organisations over many years - which is the classic way - founding or working in a start-up in the context of digitisation can be a good preparation for the management task of the future. Belonging to and building networks in the "digital community" is a key success factor for the future.
A "succession 4.0" today is decisively shaped by the agility of start-ups, includes thinking in digital business models and, of course, ultimately also includes a disruption competence with regard to the family business of its predecessors.
It may be that the successor must then actually blow out one or the other fire and sweep away the ashes. Die others will then shine all the brighter. ®
Authors: Prof. Dr. Tom A. Rüsen,
Dr. Anne Katarina Heider,
Witten Institute for
Family business (WIFU)