Sustaining family business innovation

Within a family business, generations can support each other in driving innovation and creating a shared vision through open communication of ideas and discussion on traditions and potential programmes.

Arecent report by the DCU National Centre for Family Business (DCU NCFB) and supported by AIB has revealed that family businesses can often be more effective innovators than non-family businesses.

In the report, entitled ‘Continuity through Regeneration and Resilience: Key Metrics of Success and Sustainability for Irish Family Businesses 2022’, five case studies from across Ireland illustrated how resilient family businesses can adopt innovative practices faster to sustain their business. Family businesses are integral to the Irish economy, accounting for over 64% of all firms and employing more than 938,000 people nationally (DCU NCFB 2020). That is why it is important that family businesses are sustained from one generation to the next in order to support the communities they’re based in.

The family businesses in the DCU NCFB report recognised that knowledge, traditions and learnings are passed through generations, which goes on to create intergenerational and innovation success in a family business. The following three steps can go on to support innovation within the business.

Ideas

The first step in developing innovation

“It family businesses are sustained from one generation to the next in order to support the communities they’re based in.” within the business is to create a healthy culture for ideas and opportunities. If a family business has a good culture, this can create an environment which can allow employees to make out-of-the-box suggestions which can go on to have an impact on business performance. It is important to look at the way things are done within your family business and ask does your culture support idea generation?

Traditions

The second step is to know how best to connect innovation to the accrued acumen and traditions of a family business. The ability to combine traditional materials and techniques with new ideas can often lead to products or services that simply can’t be imitated by competitors and offer an appealing proposition for consumers. It is important to look at what traditions are an important cornerstone of your family business and how can they grow.

Programmes

The third step is to adapt and transition new ideas and concepts into successful and sustainable business programmes. Innovation in family business does not need to be one big project; it can involve multiple programmes over time. Many businesses are choosing to tackle one UN Sustainable Development Goal at a time in order to make their business more sustainable into the future. It is important to look at what innovation you want to make to your business today and what would success look like at the end.

For more information and guidance, go to AIB’s family business webpage https:// aib.ie/business/sector-expertise/familybusiness.