Family businesses are certainly different to non-family businesses, but has the impact of the pandemic been the same for both?
The quick answer is yes, in that it is likely to have impacted on the way business is conducted, staffing levels and the finances. However, the unique nature and characteristics of family businesses has affected them in a number of specific ways.
A family business can be defined simply as one that the same family has run for more than one generation, or perhaps where two or more members of a family run a business. As such many family businesses have had to deal with the economic impact of national and international events, from financial crises and world wars to epidemics. In for the long haul, they are well versed in battening down the hatches. Few though, however battle hardy, were prepared for the pandemic.
How then might the pandemic have affected family businesses? Decoupling personal life with the life of the business is not always easy for a family business. Lockdowns, self-isolation even becoming ill with the virus, let alone the sad loss of a family member make it an intense demanding situation for managing a family business. There seems little or no escape. In fact, it has probably served to highlight the vulnerability of a reliance on family members and the potential lack of any continuity plans.
Perhaps the other key area is dealing with the need to respond to the situation, with the very core and essence of business impacted by the exponential pace of change in the way we conduct business. The most significant of which undoubtedly has been the need to adopt and embrace technologies and new ways of working. This and the need to consider the strategic response to the situation has perhaps challenged a number of family businesses, not least those that might not be able to draw on, or benefit from, the advice of a management team, external advisers or Non-Executive Directors.
Looking ahead though, it would be wrong to think that family businesses are more vulnerable than their non-family business counterparts, far from it. Their resolve, resilience and sense of loyalty, along with ingenuity, innovation and being in it for the long term will no doubt see many such business survive and thrive for generations to come. There will though be lessons to be learnt from 2020!
