Included this week:

• Strategies leading family offices use to maintain team performance

• The (really) strange psychology of money

• A great podcast on spending wisely when you’re wealthy

• The single most important parenting strategy (TED alert)

• Family office technology - tell me your story!

The Secrets Behind High Energy Family Office Teams

Lessons to keep any team performing

Staff turnover at family offices is traditionally very low. This is a good thing.

Family offices are built around long-term relationships and trust. This has numerous advantages; knowledge and experience remain within the family office and is not lost as employees move on. Continuity within the investment team supports the long-term strategies that family offices typically prioritize. Employees understand and are accountable for investments spanning many years.

But if teams remain static over time, this can lead to a lack of innovation in the family office and a feeling of stasis.

All companies need fresh perspectives and new skills to help them adapt to evolving market conditions and technological advancements.

Today it’s a look at some of the strategies family offices can use to keep their teams fresh, proactive, and innovative.

Continuous Professional Development 🎓

The best family offices ensure that both family members and employees are continually learning.

Family offices that invest in continuous professional development help staff stay up to speed with the latest industry trends and skills, while also help develop a culture of learning and growth.

Family offices can implement highly specialized training programs, such as advanced estate planning techniques, cybersecurity protocols specifically designed for high-net-worth individuals, or specialized investment strategies tailored to their distinct portfolio needs.

Specialist agencies provide leadership training for family members preparing to assume more significant roles within the family office. This includes governance training, conflict resolution, and succession planning to ensure a smooth transition of responsibilities across generations.

As with any company, professionals such as lawyers and accountants should consistently pursue ongoing professional education.

Innovation Incentives 💡

Innovation is the heartbeat of a forward-thinking organization. To encourage innovation, many family offices have implemented innovation incentives. Creating a reward system for innovative ideas and improvements can spur creative thinking and proactive problem-solving.

Around 60% of family offices use some form of Long Term Incentive Schemes to align the interests of their people with the family’s objectives.

The Pritzker family office has implemented a comprehensive innovation incentive program. They encourage employees to participate in regular "innovation sprints," where teams brainstorm and develop new business ideas over a short, intense period. The best ideas are rewarded with bonuses and the opportunity to lead the project through to implementation. This approach has resulted in several successful ventures in the technology and healthcare sectors, significantly diversifying the family’s investment portfolio.

Rotational Programs 🔄

Monotony can stifle even the most dedicated employees. To combat this, job rotation programs may be effective.

These programs give employees exposure to different roles and responsibilities within the office. This can promote a broader skill set, making the team more versatile.

For example, a family office might rotate a financial analyst into a client relations role for a few months. During this time, the analyst would gain valuable insight into client needs and preferences, which could inform better investment strategies later on. Conversely, a client relations manager might spend time working with the investment team to understand the technical aspects of portfolio management.

Use The Operating Company 🏭

JP Morgan estimates that 70% of family offices have associated operating companies. Family offices should leverage the operating company as a teaching opportunity.

Whether it is secondments or consulting, exposure to the operating company will help family office employees and family members understand the family culture as well as the underlying business supporting the family office.

Working with new teams and different environments will help people to gain new perspectives which they can then use to help develop the family office.

Open Communication 📢

Open lines of communication are crucial. Family offices that have a culture of open communication where team members feel comfortable sharing ideas and feedback are almost always more engaged and dynamic.

The Grosvenor Estate, managing the Grosvenor family’s assets, emphasizes regular communication between its members and employees. They hold quarterly town hall meetings where employees can ask questions and provide feedback directly to the leadership team. This transparency builds trust and ensures that everyone is aligned with the family’s goals and values. It has led to successful initiatives in urban development projects where ground-level insights significantly influenced strategic directions.

The Role of Leadership in Promoting Open Communication

1. Active Listening: Family leaders must actively listen to their team members, demonstrating that their input is valued.

2. Transparent Decision-Making: Sharing the decision-making process with the team helps in building trust. When employees understand how and why decisions are made, they feel more included and are more likely to support the outcomes.

3. Feedback Loops: Implement structured feedback loops where employees can see the impact of their suggestions and how they are implemented.

4. Encouraging Constructive Dialogue: Create an environment where constructive criticism is welcomed. This helps in identifying potential issues early and finding collaborative solutions.

Well-being Programs 🌿

Employee well-being should not be underestimated. Prioritizing well-being with wellness programs, mental health support, and work-life balance initiatives helps maintain high morale and prevent burnout.

The Walton Family Foundation places a significant emphasis on employee well-being. They have developed comprehensive wellness programs that include on-site fitness centers, nutrition counseling, and mental health resources. The foundation also promotes flexible working hours and remote work options, ensuring employees can maintain a healthy work-life balance.

A happy team is a productive team.

Mentorship Programs 🤝 

Mentorship programs play a pivotal role in family offices. They are good for employees and they are good for family members. These programs help encourage continuous learning and knowledge transfer between generations.

The benefits of mentor programs:

• Continuous Learning and Development: Pairing less experienced individuals with seasoned pros creates a structured environment for ongoing education.

• Knowledge Transfer: Mentorship ensures the passing of valuable institutional knowledge from one generation to the next, crucial for preserving the family’s legacy and business acumen.

• Building Stronger Relationships: Mentorship encourages collaboration and open communication, supporting a cohesive and supportive work environment.

• Succession Planning: Effective mentorship programs are vital for succession planning.

For more on mentors, there’s a whole newsletter here.

Collaborating with Allied Family Offices 🌐

Wealthy families and their family offices often form alliances. These alliances can be incredibly beneficial, offering opportunities for shared learning and joint initiatives.

Joint Training Programs: Collaborating on training sessions can bring fresh perspectives and expertise into your family office.

Innovation Exchange: Sharing successful strategies and innovations can help all participating offices stay ahead of the curve. Regular meetings or forums for discussing new ideas and improvements can foster a culture of continuous innovation.

Shared Resources: Pooling resources for certain functions, such as technology investments or wellness programs, can provide access to higher-quality tools and services than each office might afford individually.

An Ongoing Priority

As the financial world becomes more complex and competitive, the ability to keep a team motivated and engaged is more critical than ever.

Family offices that prioritize these strategies will cultivate a culture of excellence and innovation.

An engaged and motivated team is the bedrock of a successful family office - and any successful business.

𝕏 highlights

The latest UBS Family Office report has been released, here’s the latest on family office asset allocation.

The strange psychology of money.

How billionaires are donating to the US election.

 💼 where to work

Three notable family office job opportunities currently open…

Family Office Advisor - Pennington Partners (Multi-Family Office / Maryland)

General Counsel - Private Family Office (Single Family Office / New York)

Trust Manager (Private Wealth & Family Office) - TMF Group (Service Provider / United Kingdom)

📚 what to read

I was reminded this week of an absolute classic - The Tipping Point: How Little Things Can Make a Big Difference by Malcolm Gladwell. The book explores how small changes can create significant impacts. A compelling and insightful look at society and influence. Time for a re-read!

📻 what to listen to

This is not the first time I have recommended Money Wise by Sam Parr - but the episode It’s Easy to Spend but Hard to Spend Well is particularly relevant for family offices and UHNW individuals.

📺 what to watch

The most important parenting strategy. The good news is we are still allowed to yell at our kids!

And finally…

There are some exciting newsletters in the pipeline. There will be a series on family office tech.

So I want to hear from you. If you’re a family office, what tech to you use?

(I will share the results in an upcoming newsletter)

If you’re building family office tech or you have recently implemented your own system, hit reply to this mail, I’d love to hear about your experiences.

That’s all for this week, here’s to an incredible weekend!

Family Office Buzz will be back on Monday (here’s the last edition if you missed it) with more of the best content on family offices and beyond.

Until next week, see you on 𝕏 or LinkedIn

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