Family offices are at a crossroads. While many are navigating increasingly complex investment terrain and operational risks, a surprising number remain underprepared for the future. Nearly three-quarters of family offices admit to being either underinvested (34%) or only moderately invested (38%) in the technologies needed to run a modern business. Yet, technology is no longer optional—it’s a competitive differentiator, a shield against risk, and a key driver of efficiency.

The good news? A growing number of family offices are acknowledging the gap and taking steps to close it. Today we take a look at the critical pain points caused by underinvestment, the areas where technology is making the biggest difference, and why embracing forward-looking plans isn’t just a necessity but a strategic advantage.

Falling Behind in Technology Is More Risk Than You Can Afford

Inadequate investment in technology has been flagged as a core risk by 17% of family offices, but the real number may be much higher when factoring in the ripple effects of outdated systems. A lack of robust operational technology can compromise everything from investment performance to client service and even regulatory compliance. Without the right tools, family offices risk falling behind peers who are leveraging technology to enhance efficiency, transparency, and scalability.

Security is one of the clearest examples of where underinvestment hurts. Cyber attackers frequently target family offices, knowing they manage significant assets and often lack enterprise-level security protections. A ransomware attack could paralyze operations, locking critical financial data behind a paywall. Phishing schemes could trick staff into revealing credentials, allowing unauthorized access to investment portfolios or confidential family records. Even more insidious, a breach of sensitive personal information, such as trust structures or family holdings, could result in identity theft, fraud, or extortion.

The fallout from such events can go beyond financial losses. Reputational damage can undermine trust with key stakeholders, including family members, advisors, and external partners. Regulatory penalties for failing to secure client data can compound the financial burden, while the time and resources required to rebuild systems and relationships can further strain already stretched teams. The cumulative impact is not just disruptive but can erode the very foundation of a family office’s operations.

The Disconnect Between Acknowledged Risks and Action Plans

Acknowledging a problem isn’t the same as solving it. While 43% of family offices are rolling out a technology strategy this year, many still face a disconnect between recognizing the risks of underinvestment and taking meaningful action to address them.

Even those that have begun implementing strategies often focus only on the surface. For example, many offices prioritize tools to enhance security and risk control (65%) and streamline investment operations (49%), but other critical areas—like tax planning, wealth management, and client services—are often left underfunded. Without a holistic approach, these offices may still fall short of realizing the full potential of technology.

Operational Tech Gaps Are Widening as Digital Adoption Accelerates

Technology adoption is no longer a trend; it’s a requirement for survival. The most widely used tools in family offices today include cloud-based systems (87%), virtual meetings (82%), and mobile communication apps (71%). These tools have become table stakes for maintaining basic operational efficiency.

However, it’s in emerging areas like data analytics where the divide between leaders and laggards is becoming stark. Over half of family offices (55%) are using data analytics to improve investment decisions, but just 42% are applying these tools to optimize operations. Offices failing to adopt data-driven approaches may find themselves reacting to market shifts instead of anticipating them. For example, they might miss opportunities to rebalance portfolios based on predictive trends or fail to detect operational inefficiencies that drive up costs. Without data-driven insights, decision-makers risk being outpaced by competitors who can act faster and with greater precision, leaving lagging offices to play catch-up in a rapidly evolving environment.

Artificial Intelligence Is Moving From Concept to Reality

Artificial intelligence may still be in its early days for family offices, but its transformative potential is undeniable. A modest 12% of family offices have started using AI to automate processes, optimize portfolio management, and strengthen risk oversight. While this may seem like a small percentage, those early adopters are gaining a first-mover advantage that will only grow as AI tools become more sophisticated.

For family offices still hesitant to explore AI, the cost of inaction is likely to increase. AI can detect patterns in market movements that might signal a strategic investment opportunity or flag potential risks in a portfolio long before they become obvious through traditional analysis. Without these capabilities, a family office might miss out on diversifying into a high-performing asset class early or fail to identify a growing exposure to a volatile market. Beyond investments, AI can streamline compliance by identifying discrepancies in real time, reducing the risk of costly regulatory penalties. Offices that avoid AI risk being outperformed by those leveraging its power to stay ahead of both opportunities and threats.

The Rewards of Closing the Technology Gap

Family offices that have embraced technology are already reaping significant rewards. Operational technologies are improving privacy and controls for 38% of adopters, helping to protect sensitive family data and reduce the risk of breaches. Scalability and flexibility have improved for 30%, enabling offices to grow their operations or adapt to market shifts without overhauling systems. For another 30%, these investments are driving cost reductions and greater efficiency, allowing teams to focus on strategic initiatives rather than being bogged down by manual processes. Even employee satisfaction is on the rise, with 29% of offices noting improvements due to more streamlined workflows and user-friendly tools.

These benefits are not abstract—they directly affect daily operations and outcomes. Offices with more advanced technology are better equipped to handle sudden regulatory changes, mitigate cybersecurity threats, and manage the increasing complexity of global investment strategies. The difference is reflected in satisfaction levels: 87% of moderate or extensive technology users report being satisfied with their systems, compared to only 66% of low adopters. For family offices, the message is clear. Investing in technology isn’t just about keeping up; it’s about creating a foundation that supports long-term success and resilience.

A Call to Action for Family Offices

Closing the technology gap is a decision that will shape the future of your family office. The risks of underinvestment are tangible, from missed opportunities in portfolio management to costly security breaches and operational inefficiencies. These are issues affect your ability to protect assets, make informed decisions, and provide value to your stakeholders.

Taking action doesn’t mean overhauling everything at once. Start by addressing the most pressing gaps. Evaluate whether your cybersecurity measures are strong enough to protect sensitive family data. Assess whether you are using data analytics to make faster, smarter decisions about your investments. Explore how tools like artificial intelligence could help automate repetitive tasks, giving your team more time to focus on strategic initiatives.

The offices that are already investing in these areas aren’t just surviving—they’re thriving. They are more agile, more efficient, and better prepared to face the complexities of today’s financial environment. The question isn’t whether technology will play a role in the success of family offices but whether yours will make the investments needed to keep up.