How Did You Do This Year? Benchmarking Family Office Performance
Follow effective action with quiet reflection. From the quiet reflection will come even more effective action.
-Peter Drucker
In the rush to wrap up 2012, taking time to stop and reflect on the office’s performance can feel like a luxury for which there is no time. Yet 44% of recent FOX Family Office Benchmarking™ participants tell us that they provide their governing board with an annual report of the value provided by the family office. Summarizing the varied and complex work accomplished by the average office staff on behalf of a multi-generational family enterprise is no small feat.
How do they do this? Where does one begin?
FOX has long advocated the importance of the annual family office review and has designed a new Benchmarking Board Report with this challenge in mind. The Board Report summarizes this year’s benchmarking results – with data from 95 family offices from around the world – into six key areas of oversight. We hope that every family office board will pause this year to consider their performance in these areas:
- Oversight and governance – Who is involved in the decision making process, and are there opportunities for all to participate?
- Owner education and engagement – How is the office preparing the family to be responsible owners? Have you invested properly in an education budget for family members and a systematic process to provide training? Are family members engaged in the wealth management process?
- Client experience – How and with what frequency is the office staff communicating with clients? Are client satisfied with the office’s services?
- Wealth sustainability – How does your actual investment performance compare to your targets? To family member spending rates? Do you have the right team of advisors involved?
- Complexity and cost – What is the “all in” cost of managing the family’s wealth? Are your costs in line with external providers? Is the complexity you’ve created (e.g., entities, partnerships) returning benefits that outweigh the costs?
- Employee experience – Are you preparing your staff for success? Do they have the education and training that they need? Do you have the right team working on the right things?
If you have not yet participated in FOX Family Office Benchmarking™ and want to compare your office’s performance this year to 95 of your peers, please contact us at benchmarking@familyoffice.com to learn more. During this holiday season, we wish you all the gift of time for quiet reflection and much success in 2013!