SINGAPORE: Attracting and retaining talent is a key challenge faced by family businesses in Singapore, a survey by PwC and the Singapore Chinese Chamber of Commerce and Industry (SCCCI) found. The results were revealed at an event on Thursday (Jan 21).
The survey showed that 65 per cent of family businesses in Singapore cited attracting talent as the biggest challenge faced, followed by succession planning. Over a third of Singapore's family businesses are in their first generation, and 54 per cent in their second.
While some say they intend to hand over management of the business to the family's next generation, family members of the next generation may not want to take over the business because of better career options and opportunities.
To meet this challenge, survey respondents said they were trying provide internships, as well as allow diversification into new areas of business in an attempt to interest the next generation.
Respondents also said they are increasingly likely to bring in more talent from outside the family to professionally manage the business, with about half saying this is part of future plans.
Almost 80 per cent of those surveyed said they were looking for commitment and passion towards family businesses in potential successors. Only 6.6 per cent cited the age and gender of potential successors as extremely important.
For the survey, 112 quantitative interviews and 6 face-to-face interviews were conducted in Singapore from July to September 2015. The turnover for the majority of participating companies was between S$10 million to S$50 million.
FAMILY VALUES KEY FOR FAMILY BUSINESSES
For Singaporean businesses, the priority when attracting talent is stability, according to PwC Singapore Entrepreneurial and Private Clients Asia Pacific Leader Ng Siew Quan.
“I think one of the key driving force is the family values that holds dear to the family. And from the survey, it’s very clear stability and harmony comes above anything else," said Mr Ng.
"We talk about stability, then returns, then we talk about growth. And I think the family values that they have, binds the family, binds the business, and they are able to bring the business to the next level," he added. "To run a successful family business, you need to treat your family members like employees, and your employees like family members."
Ms Pamela Loo, 27, a director at Focus Network Agencies (S) said being part of the family business means that there is more room for negotiation and flexibility when it comes to decision making.
It also allows more importance to be placed on values such as humility, compassion and generosity, she added.
Ms Loo, who is the daughter of the company's CEO Paul Loo, said that bringing in talent from outside the family was not an issue for her.
"At the end of the day, it’s about what’s important and what’s objectively good for the company," said Ms Loo. "If a professional can come in and offer way more advice and way more business acumen than my family, my siblings can do, then why not?”