If you operate or work in a family business, you’re part of a very Darwinian food chain. Everyone knows the statistics: fewer than 1/3rd of family businesses make it to a second generation. Approximately 10-15% make it to a third generation. Less than one-in-twenty make it to a fourth.
It takes a lot for a family business to survive in the long run, but there is at least one common variable among those that have stood the test of time: they innovate.
Unique among other types of enterprise, the family business has a natural draw towards tradition, long-term visions, a sense of legacy, and risk aversion. These are considered virtues in most circumstances but unfortunately can be a natural buffer against creative entrepreneurship.
If you are the founder of your family business, you want to establish your own vision and tradition. If you are not the founder, it may be uncomfortable to challenge the founder’s vision. But the business still has to deliver on strategy.
The trick is realizing that not innovating is the riskier proposition. Some visionary family businesses are going to think outside of the box, even if yours does not.
Innovation doesn’t just happen overnight.