Impact Of Technology On A Family Business

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Despite the fact that technology and family businesses have always performed individually, today it has become inevitable for the two to work hand in hand in order to grow and develop hence bringing about the impact of technology on family business. This is exactly what this post seeks to elaborate, to explain in detail both the positive and negative impacts of technology on a family business. But before we get into one will need to understand what technology is and what a family business is. In 2009, Tidd and Beasant described technology as a form of technology as a form of knowledge applied to development, commercialization and creation of new processes, products and services. It has also been defined as decided application of information in production, utilization and design of products and services as well as organization of human activities. A family business is a firm where ownership is passed on from one of the family to another generation after generation. Or a company whose ownership and operation is under two or more people of the same family. The developments in technology have given family businesses the ability to grow and get into competition with other larger businesses. With all of that said, it is now important to examine what impact technology has got on family business.

  • Added convenience to consumers

Considering the high access to the to the latest technological advancements it will be such an inconvenience for them buy products and services from a business that only depends on cash. Technology has come with easy to use systems where businesses can register to make service delivery easier and convenient for both the business owner and the customer. Such systems allow customers to pay for products and services through the internet using credit cards and other payment modes. This way consumers can always get the products they need without any worries because they are always assured of a hassle-free and quick procedure.

  • Business software advancements

For perfect and accurate calculation of business expenditure and profits family businesses today have adapted the new advancements in business software that technology has brought. Some of these include QuickBooks and Microsoft business solutions and they are very essential in the accounting sector of any business and as we all know the accounting sector will determine how well a business grows. For a family business to prosper it must be able to perfectly handle all of its expenditures and manage profits well so it is unavoidable to use this technology which is very helpful in those sectors.

  • Cost effective solutions

Technology has helped family businesses to remain in operation and compete with large companies because it overly cuts down on the costs of operation. With the increase in technological components such as computers, the need for human labor has greatly reduced and this means that family businesses are spending less as they don’t have too many employees to pay. Advanced machines are being produced day by day therefore instead of hiring about five or ten people, one machine can be used to get better results and in within less time which has greatly increased production from family businesses in order to meet the increasing demands of consumers.

  • Improved communication process

Family businesses are not usually made up of large numbers of people but this doesn’t make quick communication any less important, there is still need for business members to communicate frequently and quickly and technology had provided the solution to this. Through websites, emails, texts and so many other app communication has overly been eased both with business partners and consumers. Through information technology, family businesses can also survey the market to know what consumers need and the best strategies to penetrate through the market. With technology it has become possible for family businesses to get in contact with consumers in real time settings which was impossible in the past centuries especially for such small businesses.

  • Increased employee productivity

Through using technology family businesses can get the very best out of their employees. Technology offers business software and various computer programs that help workers to be much more productive reason being such programs are much faster and more effective compared manual techniques that waste too much time while producing very little. Technology provides easy solutions to meeting the overly high and every changing demands of consumers by family businesses.

  • Outsourcing considerations

The use of technology in a family business allows it to consider wider options that the larger organizations use such as outsourcing. In case you are wondering what outsourcing is, it is a practice of a company using workers from outside the company to do the tasks that would have been done internally in order to reduce expenditure. Sometimes outsourcing is done in order to access skills that are not available within their organization which is very good for the growth and development of the family business. In most cases family businesses all the necessary facilities but with the help of technology they can access the proper facilities through outsourcing whenever they need them without too much hassle. With technology the small businesses like family business get a chance to search from various part of the country in order to find the cheapest places to outsource.

  • Enlarges the market

Most family businesses used to concentrate on the local market which is closest to them because it was hard for them to access the larger market however through technology it has become very easy for a family business to reach a larger part of the national market and even the international market. There are very many ways to market the business through internet technology such as websites so family businesses can also get to tap on the larger market. And through other tools like web burners and ads they get to advertise their products and services. Such big potential could only be reached at by the bigger organizations however technology has made it overly simple today even small business have access to these services.


In the first part of the post we have looked at the impacts of technology on a family business and it has been outlined that technology is important for any business to grow. But someone would really ask why it is important to have technology, which brings us to the second part of this post that enlightens you about the importance of technology in your family business.

  1. Eases storage of important information; technology comes with so many storage devices that have substituted the old storage systems of having large piles of paper work in office. All important files of information can easily be entered into a computer to reduce the bulk and also make the job of looking for any file you need very easy. The existence of virtual data warehouses eliminates the need to spend money on renting space and allows you to find important files in a just a matter of minutes. This also helps to create more breathable space in your work place, especially if it is one of those family business offices with limited space.
  2. Better information sharing; whether it is broadcast or written information, technology just creates the easiest means of it getting to all business members in the least possible time. Besides information sharing within the company itself, it is also extremely simple to access information from outside the company that can help you improve the running of the company and make it much more profitable, this can be done through E-learning. Considering the enormously large number of people on the internet a company can advertise and market many of their products to the thousands of people. With such easy access to all kinds of information even a business as small as a family business can easily reduce on the costs and increase their profits.
  3. Time; the main advantage that a family business can ever have over a very well established large business is that the family business is more flexible, it can easily adapt any sort of change. The rise in information technology helps family businesses to reach to customers that are far away in just a matter of minutes by use of emails and texts. Back in the day one would have to either use postal letters or travel to far away distances to reach customers that are far away which is not the case today. A family business can now easily communicate with all customers even those that are not close by.
  4. Ease of automation; instead of hiring an ex worker which is a whole long process of searching for the ideal person and extra cost of paying them, technology provides automatic solutions to all of that. Using automation all you have to do is click a button or follow a clear set of instructions and you will be good to go. With the help of software applications like QuickBooks which is for book keeping functions and Salesforce which deals more with accounting functions so the business owner can solely run his or her business and avoid the high expenses of hiring more people.


It would be unfair to talk about the impact of technology on a family business, the benefits of technology on a family business and then leave out the importance of owning a family business. This third and last section of our post will simply illustrate the good and bad that result from owning a family business.


  • A family business in most cases features a very simple managerial and hierarchy structure, the benefit of this is that there is fast reaction to the ever changing needs of the market and the problem solving process is much shorter since it involves just a few people. When there are less people there is quick decision making because a small group of people will definitely agree to an idea faster than a very large group of people.
  • Family businesses tend to last longer, this is because everyone performs to the best of their ability for the good of the business unlike other businesses where there are all kinds of people, including those that are willing to better the business and those that don’t have the will. This means that when the business is not doing well, family members will looks for all sorts of solutions to make it better instead of everyone looking for a better place to go like it usually happens with companies that are not family owned.
  • Family businesses build the best reputation, everyone will put in extra effort in order to see the business get better and better, workers will deliver the best services to customers and treat them well. Basically all members of the family will work super hard towards building and developing the name of their family company.
  • Increased loyalty among workers, what is a family without loyalty, the people anyone can always trust the most are their family members. Therefore as an owner of the family business you will always have peace of mind because you trust the workers of your company to do their very best even when they are not under supervision.


  • Family businesses have registered just one really big disadvantage and this is the fact that as soon as something turns out not right with the business, workers become personal with each other. There will not only be break up in the business but it will also cause break up in the family which is very bad. This is the biggest reason as to why people prefer to do business with those that they are not attached to.

In conclusion, since the disadvantages of family business are very few compared to the advantages, it is very likely that many people will want to engage more in family businesses. And when this happens the best way to improve the family business is definitely through technology, it is such a changing world and everyone is moving towards the era of using technology so there is no better way to improve any family business other than exploiting technology.


Vanilla Farmer, Amazon Retailer & Tech Researcher. Yosaki is my personal blog but I'm working on some big tech project back doors. I will keep on posting various topics on things I have knowledge about.

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