The rapidly evolving digital economy, technology changes and forces of globalisation promise to have far-reaching consequences on the business models of the typical family business in Singapore.

In this study undertaken by KPMG with the support of Converging Knowledge, our survey suggests that digitalisation and innovation are two of the top three concerns keeping family businesses awake at night.

With the advent of emerging technologies like virtual/augmented reality, robotics, 3D printing and internet of things, family businesses are increasingly beset by new challenges in addition to the often discussed ones such as succession planning and governance.

This pace of technological change is also accelerating; it is expected to continue redefining industries and creating new ones from scratch. Business model transformations that once took 10 to 20 years are now happening in as few as two to five.

These new technologies already have a highly disruptive impact, transforming business practices and even the world as we know it. But collectively, they also herald in the fourth industrial revolution, also called Industry 4.0. Many of family businesses are struggling to keep pace. Family businesses surveyed were unclear to the potential of digitalisation as a means to transform existing business models. Digitalisation was often limited to deploying information systems and manufacturing processes, or e-commerce.

This report is the second in a series exploring how family businesses in Singapore are coping with many of the issues they face, ranging from business disruption and digitalisation to governance and succession.