How Family Enterprises Will Overcome the Second Wave


Actions and initiatives for entrepreneurial families as they navigate the pandemic economy.

The second wave is here. Are family enterprises ready? That depends on your point of view – and many other factors. Some commentators say yes. Others are cautiously optimistic. But that doesn’t mean entrepreneurial families are rolling over.

It’s a truism that family enterprises have never been enamored with debt. Given their attitudes, says Deloitte’s Michelle Osry1, there’s as good a chance as any they’ll scrape through part two of the pandemic with the help of intensified cash flow planning.

For Maria Fonseca2, readiness comes down to liquidity levels but also which industry family businesses operate in and how. “The name of the game has been agility and flexibility.”

Countless family enterprises have taken huge steps to survive – by pivoting to new business lines, ramping up digital offerings, slashing costs and burning through cash, or all of the above.

Survival Mode

Families realize they’re in survival mode, says Kavil Ramachandran3. After the initial shock of last spring’s economic collapse, Kavil believes protecting cash flow and retaining key customers and suppliers will help see families through the crisis. “Most (industries) have been badly affected by the prolonged negative effects of Covid-19,” he says. “Families know they must find a way out.”

How? And are they ready to endure what could be a protracted second or third wave? “I’m not sure,” says McGill University’s Robert Nason4. “But I imagine they should have learned lessons from the initial experiences and are trying to position themselves on more solid footing.”

They’re seeking out new ways to deliver product

And strong foundations they have. Family enterprises tend to possess flexible governance structures, a feature that distinguishes them from public enterprises. That, and the capacity to absorb change on the fly, says Jesus Casado5. “All have evolved quickly to adapt to the present situation and are better prepared to cope with new changes in comparison with multinationals.”

Yet it has come at a cost. It is no secret that entrepreneurial families are taking pay cuts. Others have reduced dividends to safeguard their long-term futures. In short, families have learned to live with less. “They have put all-hands on deck for no pay to keep the employees paid and on staff when possible,” says Susan St. Amand6. “They’re seeking out new supply chains and investigating new ways to deliver product.”

All About Commitment

One of their most powerful attributes, says family enterprise expert Joe Astrachan7, is their winning formula of worker loyalty and long-term investment horizons. “They also generally have a more conservative balance sheet which means that in the early part of a recovery, before lenders loosen their thinking about credit risk, they have a greater ability to capitalize on new opportunities.”

But the crisis has forced immediacy in decision-making. After all, survival is rarely put off to next quarter. Whether that’s made enterprising families nimble, due to circumstances or not, is not up for debate. It has led to deeper reflections on big questions, says University of Ottawa’s Peter Jaskiewicz8. “Is this crisis an opportunity to make some tough choices that we have always delayed, for example? When is a good time for the incumbent generation to start succession planning?”

Prepared or not, family businesses are embattled. In Canada, where the US border remains closed, there’s a growing chorus of voices calling for manufacturing to return, says St. Amand. She cites Canada’s massive farming industry, pointing to a dearth of migrant workers who, even if they could be mobilized for harvests, must follow expensive quarantining protocols. “The cost to bring food to market is very high,” she notes. “Border restrictions are creating big issues no one ever expected.”

The second wave is here. Ready or not, family enterprises will pull together – through fiscal prudence and by looking much farther than next quarter. They don’t have a choice but to.

For more information on the Family Enterprise Barometer, visit our page.


  1. Michelle Osry is a Partner, Family Business Advisory, at Deloitte, Canada
  2. María Fonseca Paredes is Director of the Institute of Enterprising Families for Mexico and Latin America, Mexico
  3. Kavil Ramachandran is a Clinical Professor and Executive Director of the Thomas Schmidheiny Centre for Family Enterprise at the Indian School of Business
  4. Robert Nason is an Associate Professor of Management at McGill University’s Desautels Faculty of Management, Canada
  5. Jesus Casado is Secretary General of European Family Businesses, Belgium
  6. Susan St. Amand is the Founder and President of Sirius Financial Services, Canada
  7. Joe Astrachan is Professor Emeritus and past Executive Director of the Cox Family Enterprise Center at the Coles College of Business, Kennesaw State University, USA
  8. Peter Jaskiewicz is a Professor of Family Business and Entrepreneurship at University of Ottawa, Canada

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