Family Business Challenge in Technology and Engineering: Human Capital in Industrial 4.0

Abstract

More than 95% of business in Indonesia is a family business that is facing difficulties and challenges to match their human capital with industrial 4.0, related to technology and engineering. This study aimed to describe efforts to develop human capital in a family business and to propose guidelines for the government to accelerate human capital development in a family business to face industry 4.0. We used a systematic literature review to synthesize findings qualitatively. The secondary data were collected for this propose. The study found three efforts were missing from family business strategic planning, namely education, training, and career development. These three efforts were a basic foundation to face the industrial revolution 4.0. The study highlighted career development as the main problem in a family business. Since executive positions were limited to the families. As a result, the turnover of high-performance employees was high. Since the family business could not provide these three efforts to face industrial 4.0 by themselves, therefore the government support is needed to design their human capital development. The proposed guidelines for the government consist of IT-based competency and its implementation for a family business. The guidelines include vocational training design, such as curriculum and infrastructure. The current curriculum was designed to adjust to industry 4.0. Thus, the finding implies the government to redesign vocational training curriculum that consists of subject matter, transfer of knowledge, and capacity development. Finally, the family business has to start developing a human capital strategic planning that linked with the proposed government supports.

HOW EFFECTIVE IS EMPOWERING MSMEs THROUGH BUSINESS TRAININGS? A LESSON FROM DAYA PROGRAM OF BANK BTPN

“…Second, the enhancement strategy by BTPN should focus on MSEM human capital investment in industry 4.0 via technology and engineering. It will be beneficial, especially for many MSME Indonesia which is typically known as a family business with limited access to technology and engineering (Rohayati and Wulandari, 2017;Anggraini et al, 2019). The technology improvement is vital for MSME to be ready in digital era.…”

Dynamic Capabilities and Performance of Family Businesses in Emerging Economies

“…The development of family governance measures can foster communication within the business family and enhance family members' emotional investment in the business, strengthening the transgenerational orientation in the business (Suess-Reyes, 2016). Additionally, family businesses may face challenges related to human capital, strategic planning, and corporate social responsibility (Anggraini et al, 2020;Yazici et al, 2018). Therefore, the ability to adapt and innovate through dynamic capabilities is crucial for family businesses to address these challenges and ensure their long-term success.…”