Technology & Innovation

How to optimize your family office with the right technology

In this article we cover how to optimize your family office with Sage Intacct.

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For those unfamiliar with the family office space, it may seem like it occupies a peripheral niche in the broader financial services landscape. The reality is that there are a broad spectrum of organizations and companies that occupy and serve this industry – and the challenges and growth drivers evident in this sector are truly a distillation of trends that are occurring at a macro level.

I recently had the pleasure of attending the Canadian Association of Alternative Strategies & Assets Family Office Summit in Toronto. It was a great opportunity to hear from thought leaders in the space, and to meet a host of practice leaders. Further proving that this is a high growth industry, the attendance for the event was such that it necessitated a last-minute shift in venues to accommodate the unexpectedly large turnout. Kudos to the team at CAASA for seamlessly transitioning the event to a larger space.

Many of the themes that were touched on over the course of the event echo what we at Sage have been hearing from our family office clients.  There are 3 core topics that are rightfully garnering attention: 1) transferring responsibilities and ownership to the next generation of family stewards; 2) how do family offices effectively retain their key personnel; and 3) how technology adoption is changing the operating models within the traditional family office.

All three of these themes are intertwined, but as our expertise lies in the technology realm, here are a few takeaways from the conference that touch on how technology will impact each of these issues.

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  1. With many family offices currently mapping out how to transition ownership and responsibilities to the next generations of family members, it’s natural for millennials and Gen Z family members to look towards technology solutions to help operationalize certain aspects of the office operations. With data security a paramount concern, shifting from on premise applications to the cloud and moving away from spreadsheet-based processes is a pragmatic first step. It’s also important to understand that the reports and KPIs for these up-and-coming generations may differ from what’s been used in the past. So, having the ability to set-up different dashboards and reports to highlight different metrics is critical. – Insert Sage Intacct Reporting & Dashboards ebook
  2. With talent retention top-of-mind for many family office leaders, it’s critical to ensure that team members are performing work that they find fulfilling – and minimizing the tedious tasks that can lead people to start looking elsewhere. For example, by automating the financial consolidations for multiple entities, family offices can significantly expedite the time it takes to close their books and eliminate hours of data reconciliation – allowing the finance team to focus on more strategic matters.
  3. Lastly, one of the panelists lamented that there’s not a “one stop shop” technology solution to handle all their needs. We would agree with this statement – but there are a host of technology solutions designed to handle specific aspects of the firm’s operations, and by making the right investments, family offices can create a “tech stack’ that is bespoke to their unique needs. The key is to select vendors that are best-in-class, and that have the built-in flexibility to work seamlessly with other applications.

For those that are considering alternatives to their legacy accounting systems, we at Sage have a extensive experience working with family offices to create a financial management platform that maps to their specific requirements. When looking at how technology can potentially elevate firm performance, starting with a secure and flexible general ledger sets a strong foundation for future technology investments.

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