Tunnel vision in family offices: The indispensable role of expert generalists
“If you’ve seen one family office, you’ve seen one family office.” Of all the tired adages in the family office space, this one makes me cringe the most. Because it’s accurate–and it shouldn’t be. This maxim implies a unique nature that can result in "tunnel vision," an overly narrow approach to managing generational wealth.
When you look at how family offices got their start, it was usually born out of a need, and a particular focus, of the wealth creator. It’s no surprise that these offices tend to have a bit of tunnel vision because of their particular focus, which isn’t inherently determinantal. In fact, a laser-focused approach can yield unparalleled results.
But what if it’s at the expense of a well-balanced approach to financial management? Problems arise when this specialized focus compromises a balanced and comprehensive financial strategy.
It stands to reason that an office might have a relentless focus on real estate portfolios and not pay enough attention to estate and legal planning. An office could have a laser focus on equities and traditional investments but fail to explore philanthropic efforts that can also serve as strategic tax shelters or align with the family’s legacy goals — the type of approach that nurtures long-lasting legacies and success for future generations.
The challenge isn't the initial specialization of a family office but its evolution over time. How does it grow and adapt to ensure that this acute focus doesn't become restrictive? How can it safeguard the family's legacy and overarching goals?
The antidote to tunnel vision is the Expert Generalist, ideally positioned as the Lead Adviser. While many family offices start off with specialists — out of initial necessity — the evolution often sees these specialists inadvertently become Lead Advisors. Although some specialists adapt well to this generalized role and vice versa, I argue they're outliers.
In essence, a Lead Advisor, in my view, should embody the traits of an Expert Generalist: coordinating a diverse team of specialists; creating an exceptional client experience; understanding and addressing unique needs; and ensuring well-integrated, efficient solutions for today and generations to come.
FINDING THE RIGHT EXPERT GENERALIST
Spotting a specialist is straightforward. Their expertise, experience, and credentials typically align with specific job requirements. But discovering an Expert Generalist? That's a unique endeavor. It reminds me of a recruitment drive I did at an Ivy League institution.
Each interview was more impressive than the last. Resumes were filled with accolades, internships at prestigious firms, and several had started business ventures or nonprofits. It wasn’t until the 13th interview that I found what I was looking for. The woman sat down in front of me and sheepishly apologized, likely aware of her peers’ plentiful pursuits, that all she had to show for her summers was work at an ice cream shop. I exclaimed: “Finally! Someone with some customer service experience!”
I was hiring an entry-level position, but one that would be on a generalist track. I wanted someone who had experience serving others, someone who had been in the trenches and had been disproportionately treated badly by a customer. These are the types of stories that help me identify what makes someone tick. We all love joyful interactions, but what happens when someone is angry? Expert Generalists don’t judge these moments, they get genuinely curious. “What is going on in the life of this person? Why are they in distress? How can I help alleviate their concerns and show them that they matter?”
There are a lot of generalists in the world, but how do you spot the expert?
Expert Generalists tend to have worked in different disciplines, but they are likely to have deep experience with customer service and hospitality. They have experience with difficult situations, and instead of dreading those situations, they lean in because they see someone in distress and know they can help. They want to not just solve problems but create an experience. They don’t get nervous when they don’t know the answer to every question — they are experts in asking questions. They listen more than they talk. They demonstrate their care in how well they listen. They are meticulous and humble. They are proactive, and they have exceptional written and verbal communication skills. You feel calm and at peace in their presence. They are salespeople who never sell. Their drivers are people, and there is no more powerful reinforcement than the affirmation they get from their clients. They live for the client experience. They find the best people to orchestrate the best experience.
Expert Generalists never have tunnel vision; they are constantly paying attention to what’s happening in the periphery.
While I appreciate the distinct focuses of family offices, my wish for the industry would be to institutionalize the role of the Expert Generalist. This would ensure that wealthy families reap the benefits of specialization without succumbing to the pitfalls of tunnel vision.