The Power and Impact of Shared DNAThe Power and Impact of Shared DNA

Family businesses and family offices are often seen as distinct entities with their own priorities, goals and strategies. But at their core, they have one critical characteristic in common: They share the same DNA—a family’s unique and defining characteristic that influences their strategies, priorities and long-term success. 

When families share assets, their emotional and financial systems become deeply intertwined. Their “relational equity” is a form of capital that transcends financial wealth. It’s visible in their families’ values, long-term vision and sustainability. It’s also why continuously strengthening the bonds among family members is so crucial to the resilience of the family enterprise. If those involved in creating and transitioning family offices and family businesses fail to nurture and leverage the strength of those bonds, they risk compromising their chances of success. 

The operative word is “family.” The family operates as a system because one member’s behavior, emotions and interactions affect the entire group. These are the dynamics behind how the family operates and organizes. As a “system,” it’s important to pay attention to all of the contributing pieces.

This perspective is rooted in Family Systems Theory, which views the family not merely as a collection of individuals but as a cohesive, interconnected unit with patterns, structures and interdependence. A family system thrives when its components work harmoniously, balancing individual needs with collective goals and preserving its core identity while adapting to change. 

Family Office vs. Business

Basically, family businesses and family offices are both family enterprises on a continuum. One may deal with investments, and the other may deal with the products or services of the family’s operating businesses, but it’s family that makes them similar. 

All advisors in the industry know that family dynamics are particularly relevant in the context of family businesses, multigenerational wealth management and family office transitions. The question is, what should we do about it? By viewing the family and business systems as interconnected yet distinct, advisors can help families build strategies to nurture both, ensuring that their business thrives without undermining family harmony and that the family patterns don’t undermine the family office that’s set up to serve their needs and manage their assets.

Example: One of our firm’s first clients had two major operating branches. The family members’ multi-millionaire father was about to retire and was beginning to pull back on his involvement in the operating businesses. His attorneys set up an intricate trust framework in the family office to release money from his estate and minimize taxes. All the money was rerouted to the family through the trust structures, and when he officially retired, it was discovered that he had few sources of personal income. Focusing on his taxes alone completely ignored the potential impact on the entire family system. 

Advisors to family businesses who focus exclusively on the structure of family offices, such as governance frameworks, operational models and financial strategies, miss a crucial dimension: the family dynamics that will influence how these work for the family and determine the success and longevity of the family office. 

A family recently engaged us to help them uncover why a seemingly well-structured governance system that had served the family over a few decades suddenly felt unstable. Over time, it became clear that confidence in the governance structure was eroding because the three siblings who weren’t working in the business felt excluded from decision making by the two siblings who were. They also perceived a lack of transparency regarding certain developments. Family relationships were directly impacting the effectiveness of the structure. 

Impact of Family Dynamics

The patterns of interaction, relationships, roles and behaviors among family members shape how the family system functions. It’s how family members support each other, resolve conflicts, make decisions and respond to challenges. It also reflects the power dynamics within the family, such as who takes on leadership roles or how authority is distributed. 

As their advisors, we must understand the family dynamics and the specific needs, relationships and aspirations of family members individually and collectively to achieve their objectives.

Where to Start?

The most common areas often overlooked include:

• True family alignment on vision and goals (rather than merely assumed)

• Conflict resolution mechanisms that address how to handle disagreements or differences of opinion 

• Open communication and trust among family members

• Understanding and addressing family relationships 

• Decision-making processes that take power, family dynamics and business priorities into consideration

• Intergenerational engagement to prepare future leaders

In essence, the goal is to ensure that the family office itself serves as a vehicle for unity, resilience and shared success (financial and familial) in the family enterprise and for the family. This is done by balancing the technical expertise required to structure the office with the emotional intelligence needed to navigate family dynamics. In turn, the family office will then be supported by a strong sense of family unity.

Putting Family First

We’ve all heard stories of an elder approaching their lawyers and other advisors to set up a first-generation family office with good intentions to protect and care for the family. But a family represents a larger group of people than just that elder. What do the adult children of that family think? Are they involved in defining the goals of the office, and have their needs and desires been considered? Advisors must recognize this dynamic and avoid assuming that there’s universal agreement within the family, especially if they aren’t engaging directly with individual family members.   

Advisors can’t attend to the financial assets of the family’s economy without addressing the emotional and relationship aspects of the family and how the two fit together. Focusing solely on the financial and operational aspects of managing the family’s economy without engaging with the family itself is a critical oversight. 

Example: A family office CEO (a non-family member) asked for advice. The second-generation siblings had always called to complain about each other, but now, one was accusing the CEO of taking sides. The CEO had always been trusted by the family and had substantially increased their assets over the years. There were concerns about how the family would be able to make decisions together. 

This example illustrates how relevant family dynamics are in the context of family enterprise systems and how advisors become part of the family system. A sense of unity can be unintentionally corroded when there’s no understanding of the family dynamics in setting up the family office and establishing strong communication patterns and clear expectations around decision-making processes.

We also recognize that it isn’t always possible to anticipate what will happen in families. But knowing as much as we can is important—as is thinking about the long-term consequences of how certain actions may impact the entire system and that complex decisions may be difficult to unravel in the future.

While systems thinking is a valuable tool for understanding and managing family businesses, the success of many family offices has fallen short in meeting the families’ goals in key areas. We sense that this issue stems from a historical overemphasis on technical expertise and family office structure, with less knowledge of the family dynamics taken into consideration when setting up the office. Therefore, minimal (or the wrong) questions are asked about the family’s relational, strategic and emotional interests. 

Example: A decades-old family office was facing challenges as cousins resisted attending comprehensive family meetings that included educational segments on topics they had expressed an interest in. The family office and grandparents hoped (with “hoped” being the key word) that the family would want to engage, despite not giving proper thought years ago to building their interest and involvement.  

Schooling has done well in teaching advisors how to set up efficient fiduciary planning, investment portfolios and trust structures. What’s been lacking is an appreciation of the family’s long-term power or understanding that structure can’t override family dynamics.  

But understanding the dynamics of the family’s emotional system is often forgotten or addressed superficially without asking the right questions and getting the answers that they and we—their advisors—need to know.

It brings to mind the classic story of Snow White and the Seven Dwarfs.¹ It’s a subtle but powerful lesson on the importance of asking the right questions, which the Evil Queen demonstrates by repeatedly asking the mirror the same question over and over again and getting the same limited answer to “Who’s the fairest of them all?” The mirror offers a truthful answer to that one question.

However, the quality of answers we receive from family members depends not only on asking the one right question but also on exploring an unlimited range of questions that align with each family’s unique relationships, priorities, goals and concerns.

Getting the right answers is important. But even more important is accepting them with empathy and understanding. Because family dynamics often involve deeply rooted emotions and long-standing relationships, demonstrating genuine empathy adds further strength to an environment of trust.

This is one of the reasons we’ve developed the Family Intelligence Quotient² (FQ). It’s similar to emotional intelligence, but with a family systems angle. Asking a wide-ranging set of questions helps to understand the patterns of behavior and attitudes that impact family connections and decision making. By reframing family dynamics as data, family members can approach the inner workings of their relationships with curiosity rather than judgment, fostering a deeper understanding of how these dynamics may influence their collective success.

We’ve also developed a Family Diagram tool in partnership with 21/64, a nonprofit that provides multigenerational advice. It’s a powerful visual tool that’s designed to help families understand the complex dynamics and relationships that shape their lives and decisions. It’s extremely useful for helping families navigate wealth transitions, generational planning or governance strategies, as it bridges emotional and practical considerations that have a lasting impact.³

It’s also a potentially valuable tool for advisors because it brings family relationships and dynamics into focus, highlighting the connections between individuals and different generations. Uncovering patterns, recognizing areas of strength and identifying potential challenges create opportunities for advisors to facilitate more open and constructive conversations among family members.

As advisors, we have an opportunity to look into our own mirror and help families do the same—by asking family members different questions that may reveal “what they (and we) didn’t know they didn’t know.” The questions aren’t complicated, but they require a different mindset for how we engage with families.

Not asking the right questions or taking the time to reflect on what we hear from families limits our insights into how families function and what they really need. 

Top 10 Questions 

These questions help to discover the needs the office serves for the family now and for the future. 

1. If no family office is in place yet, what problems would you like the family office to solve?

2. What values do you want the family office to reflect?

3. What does success look like to you, both personally and professionally?

4. Which family members are aligned with whom? How does your family handle conflicts? What would you like to improve?

5. How has the family learned to work together?  How does the family make decisions? Who takes the lead now?

6. Are there any family relationships that make decision making difficult?

7. Who in the family might disagree with how you painted the family picture?

8. What roadblocks do you think I’ll come up against in the family? 

10. What questions haven’t I asked you about the family’s dynamics that you think are important?

Dynamics Outweigh Structure 

While everyone in our field likely thinks about or understands that everything is a system, it’s unclear if there’s a good understanding of what that means in the context of generational family business-to-family office transitions. 

Many believe the answer lies in setting up the right structure, governance frameworks, operational models and financial strategies to override family dynamics. Structure can provide a playing field, but it doesn’t outweigh the family components that underpin the success and longevity of the office itself. 

Even if the family office is viewed as an investment vehicle, how it invests is a family issue in which the family should have an opportunity to participate. It isn’t about structure. It’s about building relational equity.

This isn’t just about advisors knowing the family members. It’s about knowing that structure can’t prevail over family dynamics, understanding the real nuance of how family members view and interact with each other and how you, as their advisor, need to consider that. 

This is why we view the central role of the “family” in family offices somewhat differently than some traditional estate-planning, investment and wealth management advisors. Without hearing the aspirations, questions and concerns that family members may be dealing with, it’s virtually impossible to come up with a collective view on the right solutions. In our experience, challenges or pushback usually relate to family patterns and dynamics. On its own, a focus on structure in the family office may strain relationships among family members who feel excluded, undervalued or misunderstood. Stephen Campbell, an advisor to affluent families around the world, wrote an article for Trusts & Estates, “A Practitioner’s Guide to Family Cohesion,” which emphasizes this concept.⁴ His article highlights the importance of listening to individual viewpoints, understanding each individual’s wants and needs and helping the family combine all of that to satisfy their individual and collective needs and economy.

Those questions must be asked, answered and incorporated into the family office’s goals before they can be established successfully and/or move forward from one generation to another. 

Diverse Perspectives

Advisors should remember that behind the family office, there’s a whole system of individuals who may have different viewpoints and needs. The more differences there are, the greater the complexity and diversity. We’re dealing with groups of people in a long-term process that will have long-term consequences. 

So, time needs to be set aside to tend to family relationships by asking the right questions, learning about the family and their individual and collective needs and assessing the kinds of services they expect their family office to provide.

This means that families communicate with each other and their advisors to understand why they’re staying together. What do they see as the “family” part of their family office? Are they looking only for an investment play, or do they want a family office that can help them achieve other goals? For example, how do they tend to make decisions together? Do they have a clear process and expectations about how they contribute to the joint holdings and make decisions about them?

Cast a Wide Net

Advisors need to cast their nets as widely as possible to understand the family’s dynamics, their relationships with one another and their goals and ambitions to help ensure that the people within the family system are given due consideration. 

And yes, that requires talking to more people and asking more questions beyond the senior founder or head of the family office to come up with the right solutions. There’s power in collaborating with people with other capabilities and experience to help make that happen. 

The Way Forward

Whether you’re an estate-planning attorney, wealth manager or family enterprise advisor, consider that assumptions or standardized solutions rarely fit. Being effective requires a tailored approach to meet the unique characteristics of each family you serve.

But openly questioning, discussing and understanding family members’ unique goals, attitudes and perceptions is one of the most common challenges faced by many family office advisors. Generally, there’s an overemphasis on financial planning, neglect in digging into the roots of the family’s dynamics, minimal engagement with key family members to understand the family’s broader goals and values and less digging into individual family members’ questions, concerns and ambitions.

The result? Potential family discord, unrecognized and unmet family goals and a dominant financial focus on structure versus the long-term success of the family system.

When helping family members structure family businesses and family offices, it’s important for all of us—as lawyers, financial and business advisors and family advisors—to consider the long-term impact on the family system and relational dynamics alongside the family office structure itself. 

It’s important to think through these interconnecting threads, and this requires addressing the interpersonal, cultural, demographic and governance aspects that influence the long-term success and cohesion of the family and its economic ventures.

Supporting families in creating a family office also requires professional advisors to offer strategic, empathetic and supportive guidance. Adopting a family-centric approach is the first step. But it’s important for advisors hired to advise a family office or business to recognize that they inherently become part of that family system. Knowing how to recognize and address their role in the system is central to any advisor’s effectiveness and to the goals they’re trying to achieve.

Here are some practical steps to consider:

• Communicate to the family and others the importance of family dynamics. For example, “For me to be of the greatest support to you, it would be helpful for you to fill me in on how your family works. Who’s connected to whom? Who has the greatest impact on the decisions that they make together?”

• Cast a net wide. Ask the right questions and gather diverse perspectives.

• Use a tool to dig deeper. Use a genogram or a tool, such as the family diagram, to understand family patterns. 

• Be curious and ask questions. This will help you obtain the data you need about the family you serve.

• Make sure the family office reflects the family’s values and money beliefs. Advisors can help families clarify their values and “money messaging” and build a family office that’s consistent with both. 

• Ask and re-ask the “right” questions over time. Answers and perspectives are likely to change.

• Confirm that you’re developing integrated wealth strategies. You want to achieve the right balance of financial planning guided by the family’s priorities.

The shared DNA of family businesses and offices is a unique ecosystem where values, vision and legacy converge. Recognizing and leveraging this characteristic can amplify the family’s impact, ensure financial and operational success and foster stronger relationships across generations. 

This alignment isn’t just an advantage—it’s a cornerstone of enduring family prosperity and consistent advisory value. 

Endnotes

1. Grimms Fairy Tales (1812).

2. From “FQ: Taking a Systems Perspective to Better Understand Your Family,” Relative Solutions (2024), https://static1.squarespace.com/static/64f0d006b80a5279306717b5/t/679a67ede1988465346809df/1738172398214/FQ+-Taking+a+Systems+Perspective+to+Better+Understand+Your+Family.pdf.

3. From “Family Diagram,” Relative Solutions 2025, https://www.relative-solutions.com/store/p/family-diagram.

4. Stephen Campbell, “A Practitioners Guide to Family Cohesion,” Trusts & Estates (March 2024).