Why Family Office Technology Matters: The Good, the Bad, and the Ugly

Back in the old days, when the holy grail of an integrated investment ledger and general ledger was just a dream, a family office had to cobble a system together with the tools available. Many offices relied on the combination of Microsoft Excel and QuickBooks, or they looked to a wide variety of point-based functional technology products that had been sold into the family office space – after being developed for fund managers, hedge funds, private equity firms, etc. Not a great solution, but options were limited.

Why does this lack of family office-specific technology matter? With better technology, most family offices could be a better version of themselves and provide enhanced value to the families they serve. This elevation in value delivered would be seen in better efficiency, risk management, security, effectiveness, responsiveness, and a higher level of analytical services. 

Unfortunately, a large percentage of family offices are still stuck in the “old days.” They still use a combination of spreadsheets, an accounting software package, a tax system, a document and project management system, and maybe some type of portfolio management software. This siloed approach to technology results in a difficult life for office staff with many efficiency pain points and reduced value for the families they serve. Often, current generations do not even recognize how inefficient their processes are. They’ve executed tasks in this way for so long that they’ve become very efficient at being inefficient. This will not acceptable to succeeding generations as they will expect timely data, transparency, and efficient processes.

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Examples of these inefficiencies include:

• Many Systems of Record – including Excel!
• Disparate systems – no integration
• Multiple different user interfaces and operating methods
• Complex data coming from multiple sources in various formats
• Inability to maintain data integrity due to lack of control
• Failure to integrate structured and unstructured data
• Lack of documented procedures – no way to embed risk management, data security, and operational knowledge
• Total dependence on key individuals (Single Point of Failure)

Thankfully, the "old days" are behind us because family office technology has advanced extraordinarily. Like every inflection point in history, this moment requires that change be embraced. Before spreadsheets, everyone relied on paper. The resistance to transitioning to spreadsheets was strong, but a different way of doing things was eventually accepted, and the process changed. Because the new course was simply better.

Suppose you take the concept of an integrated investment and general ledger system specific to the family office and expand on that approach. In that case, you get to the next giant leap forward for family offices. Now there is a technology platform that can simplify complexity, ensure transparency, and finally deliver one genuinely reliable source of the truth for all data. You get a strategic solution from which the office has all the information to coordinate tasks and solve problems ahead of time. You get dramatic operational improvements that enable the family office to be the best it can be.

This is a change that needs to be embraced by family offices. Because it’s better.

There was a time when the potential of Application Programming Interfaces (APIs) was seen as negating the need for an integrated platform.  The idea was that a variety of systems in a family office could be virtually integrated using APIs—a modularized approach with even the idea of a command center as its hub.  Conceptually it works. But in real life, this imperfect integration solves family office challenges with duct tape and recycled PVC piping. At its core, disparate software working in different ways and treating the data differently can never be better than a truly integrated, singular database. Furthermore, this modular approach inhibits the adoption—and promise—that AI is going to bring to family office technology. Without data all in one place, AI is simply unable to adequately make decisions and transform employees from monotonous doers to insightful reviewers.

AtlasFive® – Leading Family Offices Into the Future

AtlasFive is the platform for the family office of the future. Significant investment, product development, and rapid market adoption have made it the next-generation, holy grail for the holistic management and optimization of an efficient and forward-looking family office.

• Provides the only truly integrated platform for single and multi-family offices
• Revolutionizes the management and operation of single and multi-family offices
• Facilitates the implementation of best practice workflows across multiple disciplines
• Delivers a single source of truth so offices and their families can make decisions with greater confidence and speed