(Based on discussion recorded live at our Nov 2023 conference. A version of this article was published in FO PRO on 12 December, 2023)
The opening panel of the inaugural MyFoTech Family Office Tech & Ops Virtual Conference discussed the complexity of issues and the challenges facing family office executives, especially when it comes to technology and operations and the search and selection and implementation of new products - a top-of-mind topic as shown also by the polling questions asked during the discussion. Out of the +500-strong audience, over 80% of respondents said they were currently engaged on a technology or business process improvement project, 70% were not satisfied with their current technology and systems, and north of 80% were considering new technology in the near term.
In the dynamic world of family office management, executives face a multitude of challenges intertwined with technology and operational intricacies. The primary goal is to mitigate risks, make informed decisions, and steer clear of costly missteps. There are so many solutions and so many options available that it's hard to know where to start and what steps to take.
Steps to avoiding the wrong decision
According to the panel moderator Jon Carroll at JC + Family, who spent decades consulting to SFOs “you make the right decision based upon your needs, you discuss and overcome the barriers to change that exist often within the family office, whether it be family members or leadership or staff, and finally, you do planning that would enable you to execute on the decisions that you've made.”
The next step is the selection process. In Jon’s experience, at the heart of successful implementation projects lies the cornerstone of a comprehensive business requirements document. This document serves as a blueprint, ensuring that vendors gain a profound understanding of the specific business needs. “You can absolutely attach that business requirements document to the contract to make sure that what you required at the outset and what you agreed to, and what you thought you were getting when you signed that contract, is documented and can be reviewed in the future as needed.”
Other key elements in the selection process are due diligence and leaning on the expertise of consultants who can help ask the right questions. “One of the best due diligence you can do is to identify people who are similar to you in scope and scale and are using the sorts of systems that you're considering, and then talk to them directly about their experience.”
Pain points driving new technology adoption
Background about Asya and Tania
Asya manages and maintains SEI ATWEB, the main depository financial, investment, and reporting system for the SFO. Asya supported the system implementation 7 years ago, gathering and compiling information from different systems and sources. She is currently considering Addepar to enhance reporting to the Investment team.
Tania is responsible for the financial management, accounting and reporting system for the philanthropic initiatives and impact investments of the SFO. She is currently supporting the implementation of the SAP Concur expense management system, the upgrade and setup of QuickBooks for the nonprofit and SFO investments, and the reorganization of the document management and file storage systems for the SFO.
Technologies mentioned
SEI Archway/ATWEB, FundCount, QuickBooks, Addepar, Canoe, Arch, Orca, Box, Concur