Date: Aug 08 2013
There is a startling statistic in the recent FOX Benchmarking Report: Technology in the Family Office. Ninety-seven percent of family offices claim to have developed a disaster recovery plan. It is heartening to see that firms have adopted this best practice. It is only fitting, considering that family offices are providing critical wealth management and cash flow services that need to be dependable 24/7.
Of course, these plans need to be continually revisited and updated as new threats appear and past assumptions are debunked. Hurricane Sandy proved the great humiliator to those who thought they were prepared.
As Mike DuBose, Vice President of HUB International Personal Insurance and a survivor of Hurricane Sandy, explained at the recent FOX Financial Executives Forum in Chicago, “Many business continuity plans depend on employees working from home when the office is inaccessible. What happens when the employees can’t work from home?”
The widespread flooding, power outage and fuel shortage caused by Sandy made it impossible for employees to work from home, especially at a time they were trying to provide for their own family’s survival and safety.
A critical element of any business continuity plan is access to your business data. That can be especially challenging if your servers are located inside your facility. If you lose access to your facility or lose power for an extended period, you face recreating your data center at another location using backup storage media which is likely to require critical days of lost productivity.
The more accepted practice today is to locate your servers in a cloud computing environment. These services provide redundant, multi-site back up as well as multiple power and communication sources. Even if you totally lose your primary place of business, you will have continuous access to your critical business processes without interruption.
Family offices are always concerned about the security of their data, which is why many offices have not moved their data off-site to the cloud. According to our study, only 46% of single family offices are currently using the cloud, though more are considering it. Several IT experts at the recent FOX Forum, however, agreed that the data is actually much safer from intrusion risk at an off-site cloud facility than it can ever be inside your own firewall. This is a concept that takes a while to understand and adopt.
Using an off-site data storage or software service provides significant benefits in terms of reliability that are critical in the context of business continuity planning. As our world and climate changes in often unpredictable ways, it is good to see these concepts making traction among the family office community.