Thirty years ago it was simple. If you needed automation, you needed well-trained profes-sionals to analyse your requirements, design a system to fit them and then develop and test it for you.
Development of these systems was expensive and primarily under-taken by large companies. Over time, software houses developed pack-ages allowing smaller companies to implement well-designed solutions to satisfy generic requirements such, making automation a more acces-sible and affordable option.
Further automation and informa-tion sharing was made possible by the launch of easy to use office auto-mation tools such as Microsoft Excel, Word and email. The uptake and use of Excel throughout businesses large and small is phenomenal, especially considering it is not a database, only one person can edit it at a time and it’s very difficult to prevent errors and maintain integrity.
Nowadays, we are all users of personal productivity devices - smart phones and tablets. We use them to manage our lives as well as our work. Many of us are in a way ‘IT experts’ - some of us even like spending time in PC World - but are we getting what we want from technology?
A family of f ice is a private investment office and normally undertakes a wide range of activ-ities to support wealth manage-ment (including asset allocation and manager selection), admin-ist rat ive fu nc t ions and fam-i ly-related ac t iv it ies such as communication and reporting. As such family offices can have many different systems supporting their business. In most cases these sys-tems will have been implemented over time, are not well integrated and therefore require manual pro-cedures or Excel spreadsheets to paper over the cracks. It is possible to operate in this way for long periods but eventually a rethink will become necessary.
Specific requirements
There are many vendors out there today selling systems for family offices, yet every family office is different, has differing priorities, goals and objectives. So how do individual family offices decide which system will best meet their specific requirements?
The true goal should be to have a fully integrated system, where data is not duplicated but is accessible to multiple applications supporting every aspect of the business. Once a family office has decided it needs to change its technology or invest in a new platform, it should also take the opportunity to think about the way in which it operates today versus the best way to operate going forward.
Fund ament a l ly, the st r uc-tured approach that was essential 30-years ago is still the right way to approach a change in technology today. Listing your requirements, ranking them in order of priority from essential to nice to have, gives you a good basis for evaluating any packages or systems. Requirements should cover all the main business functions but should also include electronic storage for important documents, security, technology (eg. Apple vs PC), remote access and business continuity requirements.
Involving key members of staff in the requirements definition improves the process and gets buy-in. Identifying which functions should continue to be undertaken in-house and which could be out-sourced should be considered at this time. For example: are we happy to continue preparing monthly family reporting packs or can we outsource our administration to a specialist 3rd party provider? Do we want to con-tinue to have an in-house IT team or should we consider web-hosting? Outsourcing can be cost effective and can provide scalability and flex-ibility as well as keeping costs down.
With a clear outline of require-ments and an idea of the func-tions that could be outsourced, a list of potential software vendors and service providers can be drawn up. Meetings with the vendors and service providers will be more focused and productive as a result.
Productivity tools should be lay-ered on top of the final integrated solution. Members of the family office and employees should be able to access everything they need on their device of choice from wherever they are. Calendars, mail and address books should be stored centrally and be synchronized automatically making sure they are always current.
Technology can be extremely pow-erful and can fundamentally improve the way in which we do business and where we do it. We do, however, need to plan and structure our approach to maximise its capabilities.
