The Family Office Operational Excellence Report 2024: In search of satisfaction
The explosive growth of single family offices in recent years has dictated a greater necessity for professionalisation. As such, family office experts whether they be internally or externally sourced, are expected to perform at the peak of their ability and are expecting to be treated well in return.
The Family Office Operational Excellence Report 2024 from Campden Wealth and AlTi Tiedemann Global, found that the majority of employees and family members who work in their family office are satisfied with the operations. However, satisfaction levels are noticeably higher among employees than family members.
Family members working in a large family office (AUM > US $1 billion), meanwhile, are much more likely to be satisfied than those working in a small family office (AUM < US $250 million) where dissatisfaction levels are highest.
“I'm not surprised by these findings,” says second-gen entrepreneur and investor Nitesh Sapra. “The larger the family office, the more sophisticated and built-out they are, thus relying less and less on the actual family members on the day-to-day operations.”
“I can only assume these findings are down to the simple fact that working with family members can be difficult,” says second-gen investor and family office principal Skylar O’Neal. “There are added nuances for family members vs. non-members. Additionally, larger family offices oftentimes have more support and positions are more siloed vs. in smaller offices where you have to take on more roles to support the directive.”
The report found that the top three categories with most satisfied employees were family services (100 percent), dedicated staff (94 percent) and value for money (94 percent). Generally, core functions such as investment management, financial planning, tax preparation, and governance achieve levels of satisfaction of 80-90 percent.
At the other end of the table, however, three areas stood out with significant dissatisfaction: next-generation education (53 percent), succession planning (33 percent) and dissemination of wealth information in accessible formats (33 percent).
“The categories with higher ratings are straightforward back office functions where the lower ranking ones are less linear and more subjective,” says Nitesh Sapra. “It’s no surprise to me that this data was collected.”
“These findings are accurate to my experience,” says experienced family office professional Giles Graves. “A lot more needs to be done to provide adequate next-generation education and succession planning.”
Anecdotal comments from family office leaderships paint an encouraging picture of the family office overall, with strong satisfaction of family members in the areas of dedication of staff, privacy, value for money, information needed to make timely decisions, and governance.
“There is something very special about working for a family and being part of a family office,” says Giles Graves. “Employees and family members can feel a great sense of kinship in pushing forward for the same goals. It can be glamorous and incredibly interesting work, and resources can mean almost anything is possible, which breeds creativity.”
On evaluating the family member data by family office size and decade of establishment, the report found some important differences in satisfaction levels. When considering the above five categories (staff dedication, privacy, value for money, information for decisions and governance) that together may function as a good proxy for overall satisfaction, only half the members of small family offices appear to be satisfied, compared to 71 percent of the members of midsize offices and 100 percent of larger family offices.
“I’m not surprised at these findings and there are multiple points here,” continues Graves. “Are the family members less easy to please? Or rather are their family offices geared to satisfy the employees. I think the latter. Bigger family offices are like boarding a cruise liner, you can always find a comfortable spot. Smaller family offices can be like cramming a few people into a mini, everyone needs to compromise and get along.”
