PwC report: Polish family business successors focus on market expansion and growth

A recent report by PwC Polska reveals that nearly half of the successors of Polish family businesses, known as NextGen, prioritize expanding into new sectors and markets (49%) over the next two years, while 47% aim for overall growth. The study highlights a growing interest in generative artificial intelligence (AI) among these successors, with 75% expressing personal interest in the technology. However, over 40% of family businesses in Poland have yet to explore AI, and only 7% have implemented it.

According to the report, titled “Polish Successor: On the Path of Growth and Expansion,” 53% of family businesses in Poland are currently owned by the first generation, compared to 32% globally, while 47% are managed by second or subsequent generations, in stark contrast to the global figure of 68%. Many current business owners are aged between 60 and 70, indicating that a significant transition in leadership is on the horizon as the NextGen prepares to step into management roles.

The survey indicates that 58% of successors perceive retirement as a major challenge for their parents or current leaders, while 67% feel apprehensive about proving themselves as new leaders. Despite these challenges, 60% of NextGen members are aware of their family’s succession plan, although some were not involved in its creation, and 5% remain uncertain about its existence.

PwC Polska partner and succession planning team leader, Piotr Woźniakiewicz, emphasized the unique position of Polish family businesses as many entrepreneurs contemplate their future over the next two decades. “NextGen, usually in their early adulthood to early 40s, is poised to take on management roles, marking a significant shift in leadership,” Woźniakiewicz stated.

The report further reveals that while successors generally view their career prospects positively, they face technological challenges. Notably, more than 40% of family businesses have not yet addressed the potential of generative AI, and only 7% have successfully integrated it into their operations. Krzysztof Sieczkowski, partner and leader of the Polish private companies practice at PwC, noted that only 12% of these businesses have designated personnel responsible for AI initiatives.

Although 74% of successors acknowledge the rapid evolution of AI technology, making it difficult to keep pace, only 14% believe that generative AI will enhance their company’s profitability within the next year. Furthermore, 53% of successors express concern that AI could increase cybersecurity risks.

Trust issues are also apparent, with only 21% of NextGen members feeling a high level of trust exists between family members and non-family employees, while 44% trust the current founders. Alarmingly, 40% believe consumers have low trust in companies regarding the responsible use of new technologies, a sentiment that stands in contrast to the 21% global average.

Despite these concerns, a majority of successors are committed to their family businesses, with 42% aspiring to assume managerial roles within the next five years. The NextGen survey, conducted globally by PwC with the support of Family Business Network International, involved 889 interviews worldwide, including 57 conducted specifically in Poland.

Source: PwC and ISBnews