Demonstrating value to family office clients

Date: 06 Aug 2010


By Paul Watthey, Director of Marketing, Advent Software EMEA

The classic family office business model is characterised by a tailored, individual investment service. However whilst long term financial performance is the definitive measure of a family office’s success, the nature of communicating that performance – along with all aspects of the investment portfolio – must also match the bespoke demands of family members.

Effective client communication places a number of demands on the family office, which will need to construct an aggregate view of total wealth, along with a full asset allocation breakdown (often across a range of jurisdictions). Client reporting also includes transactions, portfolio returns and, crucially in today’s market, a demonstration of how risk management is conducted across a variety of assets classes.
This means that the family office must conduct rigorous risk testing and analyses for different scenarios, such as changes in currency rates or adverse market movements, and assess the impact of changing conditions on the financial goals of their clients.

However client communication is about more than just monthly, quarterly and annual reports. Family Offices must provide a comprehensive view of financial and physical assets while meeting the often disparate needs of various family members. A family office is likely to be working with multiple generations of a family – who will often have differing degrees of financial and technological aptitude -, so should be able to personalise reports according to each individual’s specific requirements.

Great service means ensuring there is a personal touch, being responsive to new investment opportunities that are of specific interest to individual family members, as well as having an intelligent approach to potential challenges on the horizon.
Delivering such first-rate communication is unfeasible unless a firm has a sophisticated technology framework in place. Family office systems need to be seamlessly integrated between the portfolio management and accounting system, the reporting, and the client communication service, as this ensures an automatic supply of data from one to the other.

Having an automated infrastructure not only reduces human error (for example from manual inputting from one system to the other) but also improves efficiency at the family office and frees up considerable operational time, allowing staff to focus on other higher value activities and maintaining a scalable, robust service to clients.

Client satisfaction will ultimately be higher with this faster, more accurate and more personal reporting process.
More information on how to achieve operational efficiencies in families offices, can be found in Advent’s white paper: A Best Practice Guide to Family Office Technology,

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