4 Pandemic-Fueled Family Office Solutions That Help Provide Future-Proof Business Continuity

How Operational Survival Tactics Will Translate In Newly Redefined Work Environments

In the first quarter of 2020, the world saw seismic shifts in the way businesses operated. Employees left their offices, receding into their private residences where the only means of connection was via email, video, phone or online chat.

Without a centralized office, there weren’t any drop-ins or quick sign-offs. Swivel chair processes as we knew them ceased to exist. And, in the thick of it—across geographies, industries and markets—we saw entire operations upended and antiquated workflows grind to a halt.

Much like the rest of the world, many family offices and financial institutions serving wealthy families scrambled to create continuity in the absence of the in-person processes they relied on to serve their clients.

And then we saw something extraordinary.

Wealth management firms became scrappy. Determined to make it to the other side, they mended broken processes with new technology and they invested in teams of people that provided scalability and extensibility in a totally digital world.

Now, as businesses begin to reopen, doors are unlocked and lights begin to flicker back on, the question has become: what will remain? What pieces of remote work will stick as employees find themselves back inside of the physical family office?

Based on our experience working with hundreds of wealth management organizations, here are four pandemic-fueled trends we believe will continue to be front and center for family offices and financial institutions as they balance managing a decentralized staff with providing meaningful client interactions across in-person, remote and hybrid work environments.

Technology Investment

According to Family Office Exchange’s 2021 State of the Ultra-Wealth Business report, an overwhelming percentage of family offices invested in new technology during the pandemic.

Ranging from integrated family office software solutions like the Archway Platform^SM to best of breed and purpose-built solutions like Canoe’s AI-based data extraction technology for alternative assets, family offices are ditching spreadsheets and industry-agnostic data management tools in pursuit of technology designed specifically for private wealth management firms.

Why It Sticks:

We are in the throes of a technological revolution. And while COVID-19 may have throttled the adoption of technology forward amongst wealth managers, we have seen new technology entering into our personal and work peripherals for several years now. Disrupting the status quo and ushering the wealth management industry into a new era of digital engagement, technology is—and has been—changing the way we manage, interact with and exchange wealth information.

As the next generation of wealth owners takes asset control, there will be a greater demand for modernization of all kinds. From tools that facilitate digital touchpoints with wealth managers to technology that offers a better way to track and report on future-facing asset classes like cryptocurrencies, NFTs, SPACs and other types of alternative assets, wealth managers should be prepared for rapid changes in technology expectations amongst younger clients.

At SEI Family Office Services, we believe that family offices and wealth management firms that choose to embrace the abundance of technology at their disposal in pursuit of innovative client experiences will be better able to attract, engage and retain clients moving forward.

Digitization of Routine Processes

It goes without saying that the global COVID-19 pandemic—and the transition from office parks to home offices—exposed critical holes in the operational processes of many family offices and other wealth management firms. Traditionally beset with manual touchpoints and face-to-face interactions, processes like bill payment and client reporting were at risk of failure when social distancing became the norm.

[Check out our blog on Managing the Family Office Bill Payment Process amid Social Distancing]

But over the course of roughly 16 months, these organizations were pushed to review their operating procedures. As they identified areas of inefficiency, they were able to utilize new and existing technology solutions to help them remotely complete these historically manual tasks.

Why It Sticks:

Between Q1 2020 and Q2 2021, SEI Family Office Services saw a drastic increase in the number of report packages automatically generated using the Archway Platform’s reporting tools. In June 2021, numbers continued to surge, with over 14,000 unique report sets created in a single month.

Using the platform's tools, clients can virtually collaborate on client reporting by sharing report packages across groups of approved users. The added efficiency of pre-configured, pre-scheduled reporting coupled with the ability to work together regardless of physical location has our clients well positioned to run a largely automated reporting process. As some employees head back to the office and others continue to work from home, a digitized reporting process helps wealth management organizations effortlessly deliver timely, accurate client reporting.

And reporting isn’t the only process worth automating. Family offices are actively implementing automation when it comes to workflow processes, bill payment approvals, cash movements and financial data collection.

Digital Client Reporting Enablement

Twenty years ago, reporting was a one-dimensional output. Family offices would create basic financial reports using spreadsheets and PowerPoint presentations based on hand-consolidated data from accounting files, custodial statements and bank account summaries.

As time went on, technology companies found ways to pipe data between fintech systems, banks, custodians and asset managers. But reporting remained largely unaffected. PDF and Excel-based reports continued to be the predominant reporting mechanism despite the advancement in technology.

Then, COVID-19 hit. For 12+ months, we were asked to stay home. To avoid close contact with our family, friends and neighbors—and our clients. As in-person meetings fell off of calendars, family offices and financial institutions sought out other means of distributing client reports.

So, rather than sitting down at a desk to discuss quarterly or annual report findings, family offices took to digital tools to share financial insights with their clients.

Why It Sticks:

Tools like the Archway Client Portal became high in demand in as wealth management professionals sought out new ways to connect with their clients. While some family offices opted to only leverage the technology’s document sharing capabilities as a short-term holdover until in-person meetings could resume, others elected to share the technology with their clients in full.

With a bit of configuration and a touch of client service wizardry, family members gained on-demand, secure access to a brand new selection of interactive charts, graphs and tables. They were able to customize their portfolio views using self-defined sorting and grouping options. And directly from their phones and tablets, they were able to dive deeper into their financial insights—from aggregated holdings, expense summaries, cash balances and net worth calculations to performance, risk and model-to-actual reporting.

Much like Pandora’s Box, once a client portal—and all of its bells and whistles—is open, there’s no dialing it back.

Family Office Outsourcing

Over-extended networks. Natural disasters. Power outages. Illness. Turnover.

Financial services firms across the globe have felt the fallout of the COVID-19 pandemic. Lessons have been learned—and continue to be learned—as we navigate our way back to the office. But amidst it all, one recurring theme has emerged: everyone needs a contingency plan.

In the family office world, that plan has been a resounding need for expanded service relationships, specifically through outsourcing. Necessitated by emergency situations, loss of employees pursuing new opportunities and a desire for continuity, family offices and financial institutions are eager to partner with versatile, client-centric firms.

Why It Sticks:

Life happens. And while we all collectively hope to put COVID-19 behind us, there will most certainly be another scenario that will have us dusting off our business continuity plans. Whether it’s the retirement of your family office controller, the departure of an investment reporting analyst or just a jammed MICR printer that puts you on your heels, it’s imperative to have a solution at the ready.

With more than 50 years of experience partnering with wealth management firms, SEI has had the unique opportunity to curate a powerful combination of technology, process and, most importantly, people—all of which is designed to be tailored to your firm’s specific needs so that you can operate under the most stringent circumstances and continue delivering a seamless, dependable client experience.

If you are interested in discussing how our award-winning technology and outsourced services can help you enhance and fortify your family office operations, schedule a call with a member of the SEI Family Office Services team.

Together, we can identify ways that we can help you:

• Upgrade your family office technology stack and enhance the speed and efficiency of your wealth management operations
• Centralize and automate your core accounting, investment data aggregation and reporting processes
• Introduce an engaging client experience using enriched financial insights and tech-forward digital reporting tools
• Reduce the key-man risk by partnering with a trusted team of accounting and operations professionals to perform certain tasks or functions in conjunction with—or on behalf of—your own family office team