Those who are interested in setting up or enhancing a family office can find a roadmap in a new resource, the Family Office Navigator. Written by Peter Vogel and Mario Marconi and published late last year, the book offers several frameworks for thinking about a family office:
- Family enterprise ecosystem. This includes the core family and wider family circles, businesses and investment, philanthropic activities, and relationships with service providers and employees. The ecosystem is also affected by external factors such as regulations, market dynamics, and political and tax systems.
- Health of the family enterprise ecosystem. To assess how the family enterprise is doing, the book suggests examining five areas: the individuals in the ecosystem, the family, ownership, business activities, and their role in the broader society and environment.
- Total family wealth. This includes the different types of capital that make up the wealth of their ecosystem: human, financial, social, intellectual, and reputational.
A significant portion of the book delves into aspects of family offices that should be explored in order:
- Purpose: why it exists and how it can help the family in the present and future.
- Focus: what services the office provides.
- Organization: structure, resources, governance and monitoring.
The book is the second in a series, following the award-winning Family Philanthropy Navigator, which was released in 2020 and has since been deployed successfully around the world.
The Family Office Navigator has three key audiences:
- Individuals and families who are thinking about setting up a family office.
- Individuals and families who have a family office but need to rethink their strategy due to some major shift in their ecosystem, such as a generational transition, the sale of an operating company, or another major change.
- Services providers such as bankers, advisors and others who work with family offices and who seek inspiring material and exercises to use in their work.
“A family office serves families with the mandate to manage their total family wealth, as well as other affairs in their family enterprise ecosystem, with the objective of continuing the family heritage for generations to come,” says Vogel, professor of family business and entrepreneurship and director of the Global Family Business Center at IMD. “Depending on where families are in their journey, the shape and form and makeup of the family office will look different, and the job to be done will be different. If a tech entrepreneur has an IPO, they’re probably just focused on the money side. As the family becomes more complex, they will start thinking about onboarding and educating the next generation or other aspects of their increasingly complex ecosystem.”
More information:
- Learn more about the Family Office Navigator: www.imd.org/fon
- Listen to a webinar featuring Vogel: Authors @ Drucker: https://www.youtube.com/watch?v=BzwmEg9JDeg&t=1147s