Christi Van Rite (00:00:14) -

Hi. Welcome back to the Family Office Success podcast where we talk all things family office. Today we're discussing collaboration across providers. Sometimes this is a natural evolution for you and your firm and sometimes it can be a struggle. I don't want it to be a struggle for you. No one wins in that case, not you, and certainly not the families that you serve. I'm your host, Christi Van Rite, and I know firsthand that many of you pride yourself on delivering white glove service to your most important ultra high net worth families, all of your families. But even the best advisors have blind spots that can leave clients exposed. It's hard to see sometimes when a gap emerges between investments and tax and legal and insurance and personal and special projects and everything else that's going on in a family's life. I'm proposing for us to consider embracing a more coordinated approach between specialized advisors that is built and centered around the family's needs, and can change as the family's needs change. In our firm, we call this model the family's operating system or the FOS.

Christi Van Rite (00:01:26) -

If done right, it really can simplify very complex financial lives better than what I've seen any single firms can do alone. So we do guide firms on elevating family office capabilities. We also work directly with families. Yes, I believe so strongly in collaboration that I have experts in my corner who I will happily call in to make sure that a family gets exactly what they need, plus hopefully a little bit more. And so that's what I want to talk about today. I want to talk about how to implement some this seamless collaboration to make this feel really good for you and for the families that you work with. And I love to give context. I think one of the things that has made such a big difference in our world, in our family office world at this point, and many of you may feel the same way. I'm going to use wealth management as an example. Wealth management and investments used to be so much simpler. You know, a family worked with a single investment advisor who allocated capital across stocks and bonds and maybe some alternatives if they were getting getting fancy, you know, they diversified the holdings, they harvested gains.

Christi Van Rite (00:02:46) -

But for the most part, they relied on market forces growing wealth slowly over the decades. There was probably some real estate thrown in there. And but typically, generally speaking, it was a pretty it just wasn't quite as complicated as it is today. Now you've got markets. You know, we're seeing you've got new investing paradigms like cryptocurrencies and you've got SPACs emerging and then sort of going away. And, you know, more families seem to be interested in private equity. But even that ebbs and flows. You know, tax laws are shifting. Globalization has connected families across borders, across opportunities. Life has just changed. Not to mention that the next generation thinks completely differently about money and their legacy. They expect personalization and flexibility from the advisors they work with, you know, blending finance and passions through impact funds. And then you throw in a new, uh, something like an NFT. And now we're just, you know, now we're just talking crazy. So additionally, they want control over decision making as wealth transitions.

Christi Van Rite (00:04:00) -

That's a lot on one individual or one firm's shoulders. And that's just on the investment side. So there's a lot that can be done, and there's a lot that your clients are asking, likely asking you to do that doesn't really fall into your if you're the investment advisor, you're investing platform, or if you're the CPA or the attorney into what you're doing for the family. It just it takes a wide breadth of knowledge and bandwidth to serve these contemporary families. And it's it's just it's a lot more than one can address alone. So again, today's conversation is all about surrounding yourself with these specialized allies that can extend your capabilities, give the family what they need, hopefully cover those gaps because you've got their eyes coming at situations from various places to see the the gaps. Uh, that we may not see when we're in the in the trenches trying to get something done for a family. Now, we all know that a team is only as good as its communication. So the meat of this episode is really around creating a collaborative environment, communicating consistently and bringing all of that together.

Christi Van Rite (00:05:29) -

So this, you know, you can be the conductor of this orchestra that that really, if done well, can let you focus on your strengths and give the family exactly what they need. And you know that you're you're you know, they're covering their covering more. So let's talk about how to implement some efficient and effective things to create this family operating system. I see there to be seven, give or take a few. Uh, the first one is if we are talking about getting collaboration off the ground and really building a good foundation, the first thing is get aligned on the primary objectives. So collaboration is going to falter without a shared vision on the intended outcomes. You've got to clearly define the priorities guiding each of these decisions. So you know, you know, this wealth preservation, tax minimization, cash flow, legacy, whatever, whatever matches the needs. You've got to facilitate open conversations on with the family, on what they really want, where their values are, what their concerns are and where they want to go.

Christi Van Rite (00:06:48) -

So getting everybody aligned on the primary objective and capturing that direction in planning documents is going to allow all of the advisors to see where they're going. Perfect. Example one person on the team may think that family communication needs to be enhanced because they work with Gen three and and Gen three is frustrated with G1. Here's the thing if G1 doesn't want to do that, you're you're a little bit spinning your wheels. There's other things that if you can get those knocked out, then you've got a better opportunity to then come back and and ask for some if you can run some, uh, some family communication workshops and things like that. But getting everybody on the same page about what the family feels like is their objectives is the first thing to to do. If the family doesn't care about wealth preservation, they want those kids to make their own money, then that's probably not a great place for everybody to put their focus. You get the idea. The second is outline your specialist capabilities. So what skills across the you know, the the collaborative network here.

Christi Van Rite (00:08:05) -

Do you have what expertise what credentials. Literally make a list. Who is in the family's life right now? What this is going to do is, is illuminate blind spots where outsourcing is prudent and can prompt referrals across practitioners. You know, an estate planning attorney sees liability issues needing insurance input. An Ria realizes global digital asset exposure needs some crypto tax guidance. Identifying complementary specialties expands collective wisdom and applies to, you know, across the family affairs. So knowing who you do some that little paragraph up know who is in the family's advisory team today and really think about what the family then has so you can, you know, kind of figure out what those blind spots are. Uh, the third thing is coordinating working rhythms. So smooth handoffs between practitioners is going to prevent these weird, disjointed experiences, not only for for the advisory team but also for the family. So orchestrating the workflows is is really essential. I suggest you meet regularly, ensuring that commentary is informing decisions and that you're utilizing software to centralize these interactions and these data move, you know, what's what data do we have? What documents do we have? And task management, you've got that all in one place.

Christi Van Rite (00:09:40) -

You have a much better opportunity to you know, the family says something to the estate planning attorney who it means nothing to to them necessarily, but because they're putting some notes in and you're having these meetings, an offhand comment could potentially mean that the insurance advisor needs to get back in. Involved because something pricked his ears or pricked their ears in, um, in those meetings. So just having ongoing dialogue, clear protocols, shared systems, this synchronization, it seems basic, but it's it's not uh, it's not super easy to do, but it will transform the outcome when it's done deliberately and intentionally. And the family is going to feel that integrated effort that's to, you know, that their objectives are advancing. And oh, by the way, that's that is the kind of value that you want to show. So coordinating handoffs and working, uh, working rhythms. The fourth is uh, checking individual and collective egos. Yeah. A vulnerability, vulnerability for even specialists is ego interfering with objectivity. So pride pride can blindside you with, uh, with lots of perspectives and keep you from balancing everybody's input.

Christi Van Rite (00:11:10) - So the leader of this collaborative engagement has got to set the tone to facilitate honesty among everybody involved and create a safe setting that allows everybody to challenge assumptions and feel heard. You know, you've got to remind teams, um, that families judge outcomes achieved, not the endless debate over preferred methods. So check egos at the door and align around the family first and foremost. The fifth thing is making transparency non-negotiable. Trust is the currency enabling collaboration for wealthy families, any perceived opacity around capabilities and incentives or data handling. You know these decisions, they shatter confidence, operate with a radical transparency as your norm. Proactively disclose potential conflicts of interest in recommendations. Be clear on exactly what is owned and what's outsourced within the team's capabilities. Open the books show how firms and everybody's being paid. Just don't leave anything unsaid that could undermine the credibility families value. Truth control. Give them both. And for goodness sakes, do not undercut a fee. It will hurt you. It will very possibly hurt the rest of the team.

Christi Van Rite (00:12:38) -

And it's you need to get paid for the work that you do. Just be transparent. Getting close to the end. The sixth thing is to formalize a governments and accountability strategy. We talk about governance a lot. Uh, what I think is missing is the operational governance inside the family operating system with multiple cooks in the kitchen, clarity on who owns what will prevent confusion. Define the roles, decision rights, the escalation pathways across the advisory team. Where does the buck stop? What triggers a third party consultation? When should the family leadership weigh in? Answering these basic governance questions is going to calibrate everyone's engagement and it. Remember, sometimes being the buck stops here has a lot of liability. So if you are leading this group or you're a part of one, you know, understand your risks and don't be hurt if yours isn't the last word, know that you're all coming together to to be the best for the family and that you're all accountable. Also sharing, uh, reporting dashboards demonstrating progress on financial plans and goals.

Christi Van Rite (00:14:01) -

This showcases that everybody's moving the needle. So again, going back to having this central dashboard that everybody or the central location that everybody can come into and can see what's happening is good for good for everybody or everybody. And, you know, there's a good chance you're going to have to have a future fee conversation that, let's face it, nobody likes to have. But, you know, you're you're likely going to come across that. And if a family sees that the needle is moving and that progress is being made, those conversations really do get easier because the family's already on board. So let's talk a little bit about service models. Is the last thing. So evolving uh, conditions really dictate the flexibility in how families are going to access guidance for on, you know, on their financial affairs with their advisory team. So the next generation may prefer virtual collaboration along. Inside a brick and mortar presence. Some specialists excel serving family members during life transitions. You need to be ready to adapt the packaging around the capabilities to respond to the shifting needs of the family or emerging threats.

Christi Van Rite (00:15:19) -

You've got to know that when a family's life changes, that your workflows, your communication style, they may need to change along with it. Just don't get stuck in the because we've always done it this way mentality. I'm here to tell you that the next generation is not going to accept that answer, nor should they. So just ask, you know, when you're when you're putting your models together and your process and your procedures architect a modular component across these services. So you can you can really build a framework that will accommodate those those ebbs and flows in and how you are supporting a family. So okay, wrapping up, I realized that was a lot. And I realize that smoothing collaboration across advisors takes serious work. But efficiency gains, risk reduction and planning sophistication just it just simply surpasses what any individual can offer families alone. So try outsourcing these discrete capabilities or services before you attempt to to master the discipline from scratch. There's plenty of just amazing folks out there who can do a great job for your families and for you.

Christi Van Rite (00:16:44) -

So just remember, conduct it like an orchestra. Choose the ensemble based on what the family needs and prefers and, uh, keep communication open and flowing. If we can help you architect the system, don't hesitate to reach out. It's it's just that important to to get right. So we hope you've enjoyed. That's all for this episode. Thank you for listening. And be kind and stay curious.