Weighing the requirements and trade-offs associated with building things internally must be carefully considered.
CHICAGO (PRWEB) November 20, 2017
Linda C. Mack, founder and president of Mack International, LLC, the premier retained executive search and family office strategic management/human capital consulting firm, was invited to be a facilitator for the Opal Family Office and Private Wealth Forum held in San Jose, CA. October 25-27. The panel presentation explored the topic of using consultants and advisors in the family office. Panelists discussed circumstances under which family offices might consider hiring an outside advisor or consultant and identified how to evaluate, select and manage those relationships for the greatest success. Linda was joined by panelists, Carolyn Weiss, CFO and Treasurer of The New York Community Trust; Ron Diamond, CEO of Diamond Wealth strategies; and David Novitsky, CFA, Director, Investment Advisory Services, CTC| myCFO.
The panel talked about a variety of situations that precipitate using a consultant or advisor. Some are ongoing like investment management, while others are more short term in nature to manage a specific project. In either case, Linda emphasized that defining the needs and criteria is the first step. “Prior to engaging anyone, the family must take the time to clearly identify what they want to accomplish and pinpoint the experience, competencies, qualities and traits of the advisor/consultant that will create the best partnership. Only then can you evaluate and select the best “fit” in terms of the individual or firm you will engage.”
Using a formal proposal process is a good idea for both the family and the prospective advisor/consultant. Careful assessment of potential advisors/consultants is also important to avoid less than optimal outcomes. In the absence of a sound selection process, panel members cited situations where there was a less than desirable outcome. The importance of screening was highlighted. “Two elements of the selection process that should not be forgotten are screening for potential conflicts of interest and conducting reference checks as part of your due diligence” According to Linda, communication is also key. “You have to manage both the process and the relationship from the very beginning. Expectations must be crystal clear and ongoing communication and feedback are key to staying in sync for a successful partnership.” Stories were shared about family offices who used advisors/consultants and experienced a good or bad outcome as well as families who didn’t use an advisor or consultant and had a bad outcome. In situations where the family decides to handle the mandate or project themselves, Linda emphasized the importance of the family having a clear understanding of their competencies and limitations. “For example, a family might be extremely experienced and successful in running their operating business but perhaps is not the best manager of the family investment portfolio. If you don’t have the core competency or time, then it’s wise to hire professionals who have the requisite experience and expertise you need to help you successfully accomplish your objectives.” Family Offices who experienced good outcomes with advisors used best practices in their approach to developing criteria, a selection process, clearly and mutually defined service/performance expectations and ongoing communication and feedback to maximize success and avoid pitfalls.
Linda and the panel members expect to see consistent growth in the use of advisors and consultants by Family Offices. “Weighing the requirements and trade-offs associated with building things internally must be carefully considered. In a world of increasing complexity, the potential benefits of engaging an individual or firm with the right expertise and resources can be a very efficient and effective alternative to maximize overall success.”
About Mack International LLC
Mack International is the premier, boutique retained executive search and strategic management/human capital consulting firm serving national and international clients in the family office, family business enterprise and the wealth management industries on national and international basis. Founded in 2002, the firm has achieved an exceptional track record of success as evidenced by its unmatched industry expertise, in-depth market knowledge and unparalleled track record of success. Founder and President, Linda C. Mack has established proprietary methodologies such as the Mack 360© and is credited for having coined the term “expert generalist” in the industry.