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Talent recruitment, development seen as key for sustainability of local businesses: study
ABOUT two-thirds of Asian business families see talent recruitment and development as the main challenge to ensuring the long-term sustainability of their companies, according to a report by United Overseas Bank (UOB) and the Singapore Management University's Business Families Institute (BFI@SMU).
The report, "Riding on Asia's economic transformation - Growth strategies of Asian business families", found that Asian business families are reacting to this by hiring external professional managers to tap on their skills in areas such as financial management, technology implementation and human resources.
Asian business families also cited the importance of trusting their managers and treating them fairly as the top two ways to attract and to retain external professional managers. Remuneration, on the other hand, was ranked third.
Eric Tham, managing director and head of commercial banking at UOB, said: "Many Asian business families are at various stages of preparing for the next generation to succeed them and they recognise the need to have professional help to ensure that their business grows and remains competitive."
Meanwhile, four out of five Singaporean business families place the biggest focus on balancing growth with stability. As such, they proved to be the most risk-averse with only 29 per cent of respondents using high-risk investments as a growth strategy, versus 41 per cent in South-east Asia.
Professor Annie Koh, academic director of BFI@SMU, explained: "Asian business families tend to favour stable returns over riskier growth and expansion options. Instead, Asian business families are using innovation to improve product quality and drive cost reductions in order to achieve sustainable profits in the world's most economically dynamic region."
BFI@SMU conducted interviews with 192 key decision makers of business families from Asia for the report between November 2014 and July 2015.