Dubai Family Business Focuses on Growth, Technology Adoption: Survey

About 87 percent of young members of family businesses in Dubai showed personal interest in generative AI.

The Dubai Center for Family Businesses, which operates under the umbrella of Dubai Chambers, has revealed the results of a survey conducted to gauge the opinions, aspirations and strategies of the next generation of family business members in the emirate.

The research aimed to develop a better understanding of the changing dynamics of family businesses, as well as the strategic directions preferred by their future managers.

The 2024 survey, released by global consultancy PwC in partnership with the Dubai Center for Family Businesses, identified the top priorities for the next generation of family business members over the next two years. A total of 889 respondents from 63 countries took part in the survey, including a group in Dubai.

Expanding into new sectors and markets is first on the priority list of Dubai’s next generation of family businesses, with business development second and the adoption of new technologies third. Among the next generation of family business members worldwide, business development came first, followed by expansion into new sectors and markets in second place. Talent management and attracting and retaining the best young talent are in third place.

Comparing the priorities of Dubai respondents with those of their global counterparts, the survey shows that the next generation of family business members in Dubai are most focused on expanding their business into new sectors and markets as a top priority for the coming two years.

The survey results revealed a strong interest in generative artificial intelligence (AI), with the majority of respondents expressing a desire to use this technology in the future to drive innovation and drive greater efficiency in their businesses .

About 87 percent of young members of family businesses in Dubai showed personal interest in generative AI, well above the global average of 82 percent. The survey also found that respondents in Dubai are more familiar with generative AI than average, with two-thirds feeling personally comfortable with the technology, compared to 53 percent of their global peers.

The report highlights the role that generative AI can play in improving profitability, operational efficiency and customer experience, and reflects respondents’ views on the technology’s transformative impact on their business operations. About 32 percent of respondents in Dubai believe generative AI will increase the profitability of their businesses within 12 months, which is higher than the global average of 21 percent.

Of the next generation family business members surveyed in Dubai, 42 percent of respondents confirmed that they are aware of succession plans within their family business; However, many did not participate in the preparation of these plans. The majority of participants indicated that they find it easy to understand the various provisions of family protocols and constitutions.

45 percent of respondents indicate that the current generation’s ability or willingness to retire can pose challenges to the succession process.

Participants identified the key benefits of AI as increased operational efficiency, improvements in employee productivity and an improved customer experience. AI was also identified as a catalyst for adopting new technologies, improving the digital capabilities of the workforce and achieving business growth.

The survey found that members of family businesses in Dubai have a good understanding of family values ​​and goals, as well as the rights and obligations of all business owners. The majority also expressed a desire to assume a leadership position or role in governance within the next five years. The findings also highlight the positive expectations of the next generation of family business members regarding their future careers, including learning and growth opportunities within their family businesses.

The Dubai Center for Family Businesses recently developed a new guide aimed at helping family businesses cultivate sustainable growth through the implementation of effective corporate governance. The ‘Corporate Governance Guidelines for Family Businesses’ toolkit focuses on governance structures, governance frameworks and key regulatory guidelines for family businesses.

The launch of the new toolkit reflects the centre’s ongoing commitment to providing practical guides on the key topics of interest to family businesses. It follows the publication of six guides in 2023 covering key areas affecting the continuity of family businesses and aims to support the long-term sustainability and competitiveness of these businesses.

Mohammad Ali Rashed Lootah, President and CEO of Dubai Chambers, commented: “Family businesses are a vital part of our economy, contributing significantly to Dubai’s non-oil GDP and employing a significant portion of the country’s workforce .”