Generational change is increasingly a concern for Hungarian businesses

By: Trademagazin Date: 2024. 11. 19. 12:44

Surveys in recent years have shown that while Hungarian private businesses are addressing the issue of generational change, they are not doing so with the weight that is appropriate for the topic’s importance. However, the latest research shows that the trend seems to be reversing. They are increasingly open and prepared for leadership changes, which is welcome, as 72 percent of Hungarian employees work for family businesses, while these companies account for nearly 60 percent of GDP.

An aging group of owner-managers

Domestic businesses are increasingly concerned with generational change, according to the latest joint research by Prime by JobGroup and OPTEN. Respondents have been running their companies for an average of 27.5 years, so the company managers are strongly middle-aged. These companies and their managers are clearly ripe for transformation, with more than half (53%) of respondents planning a change in management.

Maintaining business continuity

“According to OPTEN surveys, there are approximately 600 private companies in Hungary with a turnover of over 1 billion forints today, where the company manager is over 60 years old. It is essential that successful businesses built by Hungarian owners survive and that continuity is ensured. That is why we considered it important to ask company managers about succession, as despite the openness, the answers show that several obstacles may arise before the founder-owner completely leaves”

– said Éva Fehér, managing partner of Prime by JobGroup.

More open to selling

In terms of handing over management, 68 percent of company owners stated that, ideally, they would hand over the baton to a designated family member while retaining ownership. However, compared to a similar study conducted by OPTEN in 2021, there is greater openness to other options. Today, half of company leaders (53%) are willing to hand over leadership to a new employee, either inside or outside the company, while retaining ownership, compared to only 24 percent three years ago. Awareness is demonstrated by the fact that 26 percent said they were open to selling the company, compared to only 14 percent in 2021.
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