Family businesses and GenAI: NextGen leaders to pave the way forward

73% of NextGen leaders in PwC Global survey recognise GenAI as a catalyst for change
Family businesses contribute approx. 70% of global GDP and employ 60% of the world’s workforce
With GenAI NextGen can drive strategic change, create competitive advantage and global impact

As the reins of family businesses and family offices transition into the hands of a new generation of leaders, a profound transformation is underway — one fuelled by generative AI (GenAI). For those that get it right, GenAI will shape future success. And we believe that the next generation of family business leaders and controllers of family wealth, hold the key to this transformation. We call this group of individuals the ‘NextGen’, which refers to members of the next generation of a business-owning family or family office, who are between ages 18 and early 40s and are aiming to become responsible owners, influential board members or visionary leaders.

‘Success and succession in an AI world’, our global survey of more than 900 NextGen, found that 73% of NextGen leaders recognise GenAI as a catalyst for change. They are not only more optimistic about GenAI than the incumbent generation, but also understand the urgent need to shift responsibility for AI out of discrete silos and to deploy it to support enterprise-wide adoption. However, 49% of family businesses have yet to explore AI and only 7% have implemented it.

“Family businesses are a substantial part of the economy, contributing approximately 70% of global GDP¹ and employing 60%² of the world’s workforce.”

We cannot afford for family businesses to ignore the GenAI opportunity. Family businesses are a substantial part of the economy, contributing approximately 70% of global GDP and employing 60% of the world’s workforce. Thus, harnessing the potential of GenAI isn’t only about any one firm staying competitive; it’s about shaping the global economic landscape. NextGen as future business owners — and important inheritors of the largest wealth transfer in history — have a unique responsibility towards their business and family office, its employees, their families, society and the environment.

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Insights Discussion on 2024 NextGen Survey

NextGen leaders can step up and lead the charge in integrating GenAI into their family businesses through:

Conscious and strategic adoption
Family businesses and family offices are traditionally cautious adopters, wary of the risks associated with new technologies. This caution stems from the potential for failure and the challenges in securing new capital. However, by shifting the perception of GenAI from an operational tool to a strategic asset, NextGen leaders can drive its adoption more effectively.

Leveraging unique perspectives
The NextGen's digital fluency and fresh perspectives position them uniquely to champion GenAI. They can identify innovative use cases, such as using AI to analyse large datasets for trend prediction, enhancing decision-making and efficiency. By doing so, they can create competitive advantages and ensure their businesses remain at the forefront of industry advancements.

Building trust and responsibility
Family businesses are among the most trusted entities, giving them a mandate to pioneer GenAI responsibly. By ensuring proper governance and conducting thorough testing, they can introduce GenAI in a way that aligns with their values and stakeholder expectations.

Starting with pilot projects
To mitigate risks, NextGen leaders can initiate small pilot projects to explore GenAI's potential safely. These projects can serve as a proving ground, allowing businesses to optimise AI use before scaling up.

The NextGen has a pivotal role in transforming family businesses and family offices through GenAI. With their unique perspectives and digital fluency, they can drive strategic change and create competitive advantage. By embracing GenAI, these future leaders can lead their family businesses or family offices into a new era of efficiency, innovation and global impact.

For more insight, download the full survey or contact Tristan Whitefield.

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Tristan Whitefield

Partner, PwC Private and NextGen Leader, PwC Australia

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Family businesses and GenAI: NextGen leaders to pave the way forward

Insights Discussion on 2024 NextGen Survey

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Insights Discussion on 2024 NextGen Survey

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