Older business owners face unpleasant sale surprise
OPINION: For the more sensitive amongst us, it hasn’t been a great week to be an ‘‘old white man’’.
Minister for Women Julie Anne Genter’s suggestion it was time for a few of that cohort to move along for younger and other people to rise to leadership positions in business ruffled a few feathers.
But reframing those comments as concern about the impact of ageing business owners on economic dynamism suggests she’s in pretty good company, especially when it comes to facing the super-charged technological change facing almost every sector.
Take, for example, the recently published CPA Australia survey of owners of small and medium-sized enterprises (SMEs) from across the Asia-Pacific region.
A serious drill-down into the views of nearly 3000 business
PATTRICK SMELLIE
owners, this survey found New Zealanders less ambitious, less innovative, more complacent about cyber security, less likely to be using digital technology to drive sales, less ambitious about exporting, and expecting to grow more slowly than counterparts in other parts of the region.
Kiwi business owners did, however, top the charts for having the highest levels of satisfaction about how their businesses were performing.
Those findings virtually scream complacency. As if to underline the problem, the only SME owners in our region that looked similarly somnolent were in equally ageing Australia.
More positively, the survey found younger SME owners were commercially hungrier, more techsavvy and seeking more opportunities for growth.
Likewise, there are some healthy signs in the education system and in parts of the country where the future dominance of knowledge-based work is becoming entrenched.
Victoria University’s Working Capital project this week published claims that Wellington is ‘‘New Zealand’s strongest knowledge economy’’, with nearly 50 per cent of workers in knowledge-based jobs, compared with 35 per cent nationally.
The research, based on interviews with 90 Wellington will abound as other jobs disappear.
‘‘McKinsey says nearly half our jobs will change more than 40 per cent in the next decade due to automation,’’ says Callaghan Innovation chief executive Vic Crone, who is adding to the agency’s mission the task of shaking New Zealand firms out of their complacency about the scale of disruption on the near horizon.
Callaghan’s new report,
sees the next 10 years as globally disruptive for the agriculture, energy, health and digital technology sectors.
Anticipating and implementing those technologies is crucial to whether New Zealand is an active part of that future or suffers a loss of competitiveness.
This upheaval will be occurring at the same time as – and in some ways be part of – the ‘‘just transition’’ to a low-carbon economy that Energy Minister Megan Woods told an oil industry conference this week was essential if the move away from fossil fuels is to be achieved without Rogernomics-style social and economic turmoil.
However, there is no guarantee that the rate of old job destruction and new job creation during this coming decade of digital disruption will be evenly matched.
‘‘The endgame is that, by 2030, there will be enough jobs under good case scenarios,’’ says Crone, referring again to the McKinsey forecasts.
‘‘It’s the transition that’s of serious concern – that economies can’t support those levels of unemployment during the transition.’’
Part of the problem with this forecast is that it’s so difficult to imagine, when the New Zealand economy is operating at virtually full employment and, in many sectors, employers’ biggest headache is a skills shortage.
The temptation is to hope the threat of new technology is overblown, especially for older business owners whose thoughts are turning to sale and retirement rather than investment.
For many, there may be unpleasant surprises. Seeking buyers for a satisfactory but digitally primitive business in a market defined by technological disruption risks discovering too late that a life’s work is not the nest egg they anticipated.