By James Norman CA, Foundation Member, Family Business Institute
Family office is the “New Black” of professional services firms. The Big 4 are in to it big time, deploying massive resources, as only they can do. You only need to Google “Family Office” to see who is in the space. Each week the front page of the AFR has firms spruiking their Family Office credentials. Family Office is no longer a private or secret space, it is fast becoming the main game. The changes in Financial Advice rules and the ebb and flow of the Financial Planning industry is adding to this ever increasing competitive environment.
Family Office is as old as families with “old money”. Both America and Europe claim they invented and own the concept (which is at least partly true), but we can learn from them and do things better in Australia, just like in other things.
With the onset of the digital era everyone wants to be agile (able to change direction quickly to respond to changing needs and circumstances). And, because Family Office is seen as an interesting and lucrative service offering, we’re now seeing an amalgamation of the two concepts. It’s like reinventing the “Black on Black look”. It’s not really that new, just something old and good that’s been repackaged.
Like all good trends, it all depends on whether you can carry it off. You need to be brutally honest with yourself, and with your partners and staff, before venturing into the Family Office space, because it is challenging, and there’s a very real cost to failure . You need to be passionately committed to have a sustainable service.
AFO offers exciting opportunities for Small and Medium Accounting and Financial Services firms to reinvent their relationships with their clients. It requires a powerful combination of knowledge, experience, skills and professional networks to convert opportunities into engagements, and to build and sustain successful family office relationships.
The concept of Agile lends itself well to the advisory consulting model in a fast changing and competitive environment. The concept of Lean is a key element in the efficient delivery of your services and is essential to the ability to leverage personal advisory skills into an Advisory Business.
Following the philosophy of “The Lean Start Up”, by Eric Ries: we deliver a “minimum viable product – MVP” to our clients. This helps us to scope, price, educate and set timing for new ideas and strategies that could be valuable to the family. This creates an efficient feedback loop with our clients to assess whether to proceed, or pivot.
How will you compete in the dynamic, personal, and increasingly competitive Family Office space?
Differentiation and success lie, we believe, in becoming Agile. We’ve been helped in this by our association with the Family Business Institute and its training and professional adviser network.
Ries, E. (n.d.). The Lean Start Up .