Family businesses are placing an unprecedented emphasis on innovation

The K&H innovation index examines the willingness and aspirations of Hungarian businesses with a turnover exceeding 300 million forints to innovate every six months, in which family businesses play a special role. The research examines the data along four themes: implemented, planned and digital innovation, as well as innovation strategy. The data shows that family businesses have seen their scores increase by at least 10 points in all four areas over the past six months, but the most notable is digital innovation: the research measured a 15-point increase in this area, reaching 42 points, while non-family businesses are stagnating at 34 points.

“Family businesses make up about half of K&H’s corporate portfolio, so it is gratifying to see that they are increasingly recognizing the importance of innovation, as in the current turbulent economic situation this can even be a guarantee of survival for them. Digital innovation is a particularly important area, because by investing in digitalization, these companies can save significant costs while optimizing their operations, so they will operate more efficiently not only now but also in the future. In the past four years, the values ​​have mostly moved together in the case of family and non-family companies, with the latter considering this area a little more important, but in the past six months, the gap has widened considerably”

– assessed Ákos Ékes, head of the K&H family business center.

In the case of planned but yet to be implemented innovations, there is the largest difference between family and non-family owned companies, here there is a 13-point difference between the values ​​of the subindex of the two segments. Interestingly, while the former shows an increasing trend, the latter have seen a significant decrease of more than 5 points. The situation is similar in the case of already implemented innovation investments, with a 10-point increase in the case of family companies, currently standing at 34 points, while the non-family companies have fallen by 8 points to 23 points.

The importance of the innovation strategy has not changed in the past six months for non-family companies (35 points), but in the case of family businesses, its importance has increased by ten points, reaching 40 points. This means that the perception of the innovativeness of their own company has improved in the minds of company managers, and the role of the written innovation strategy has also increased in these companies. “The existence of an innovation strategy is crucial in the life of a company in order to produce systematic, continuous development,” the research states. When responding, company managers compare the innovations implemented in their company in the past two years with those planned for the next two years, in order to provide a more general picture of the extent to which innovation is implemented in the company’s life along the strategy developed for this purpose. The ten-point increase and the spread of developments based on strategic foundations is a welcome phenomenon among family businesses,” the expert added.