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The Boomer Bulletin - 2016
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How to Make Your MP/CEO Look Great – Be future ready!

Posted By L. Gary Boomer, Tuesday, May 10, 2016
Updated: Wednesday, May 4, 2016

The role of managing partner/chief executive officer is becoming more important as firms focus on governance and challenges in the profession.  Too often, managing partners have been selected for the wrong reasons.  Some examples are:


  • Ability to get along with the majority of partners and staff
  • High income producer and good with client relationships
  • Willing to take the job while maintaining a significant book of business

While many people feel these are important traits and characteristics, these traits do not guarantee success of the firm or the managing partner. The most important question is whether the partners and staff are willing to be led and managed.  Firms where the partners want to be led outperform those who simply desire to share overhead and do not share the vision.

The more important requirements of the job are the ability to:

  • Grow the firm
  • Build a unique ability management team
  • Provide and develop leadership at all levels of the firm
  • Stay connected with peers and the profession’s leaders
  • Attract, retain and develop quality people
  • Make timely decisions
  • Develop a strategic vision
  • Build consensus and commitment to the vision and core values
  • Teach and learn
  • Allocate and manage limited resources to strategic (priority) initiatives
  • Counsel partners and staff - accountability

You and others may ask, “Why does anyone want the job in most firms?”  In some firms, leaders fear that if they do not do it, the firm will not be managed.  In the well-managed firms, the managing partner position has evolved to a professional management and leadership position, frequently titled CEO in today’s environment.

Whether your firm has a seasoned professional or a new managing partner at the helm, some important initiatives should be on their checklist.  By focusing on these initiatives, the managing partner and firm stand a much higher chance of success and improving the return on the investment of firm resources.   Not all of these initiatives will be popular with the other partners due to the fact they require significant change: investments of time, dollars and discipline.  Most CPA owners prefer working in the business rather than working on the business.

Following is a Baker’s Dozen of strategic initiatives; I hope that your firm is already engaged in many of them.  While all of these strategic initiatives are important, some firms may simply need to select their top priorities and focus their resources on those priorities.


  1. Update or develop your strategic plan.  Condense your plan to a one-page laminated document that every partner and staff person has readily available.  Refer to it continually as you allocate resources and make decisions.
  2. Develop a Technology Roadmap and budget that supports the firm’s strategic plan. Technology is the accelerator and a strategic asset. In most firms, it is the second largest investment behind talent. Development of a cloud based accounting ecosystem is the key for both internal and client requirements.  Knowing which system components are appropriate and work together is a key to success. IT leadership will require the ability to orchestrate the multiple vendors and business partners.  Accounting firms tend to have three to four times the number of applications compared to clients and other service providers.
  3. Develop talent.  Invest in your people in order to retain and attract top quality people.  Someone must be responsible for developing the learning/training environment.  Education and personal development are at the top of professionals’ priority lists, especially those who are just coming into the profession.
  4. Succession; great leaders identify and develop their successors. This applies at all levels within a firm. Do not wait, start the identification process and expose key people to the best training and experiences possible.  Fast track them where feasible. Most importantly, communicate with them regularly about their importance to you and the firm. If you do not tell them, you risk their departure for other opportunities.
  5. Focus on improving revenue per full time equivalent (FTE).  Charge hours are not a measure of value.  Benchmark the past two years by taking total revenue and dividing by the number of FTE’s (total hours divided by 2,080).  Just like in golf, improvement should be your focus. This one metric summarizes utilization, realization and pricing.  Remember that average is where the best of the worst meet the worst of the best. Quality people do not want to operate at average.
  6. Review your key processes and implement the principles of Lean Six Sigma (Define, Measure, Analyze, Improve and Control). This will dramatically reduce cycle time and improve quality and profitability.  Key areas to examine first are 1040 tax preparation, business tax preparation, time and billing, and financial reporting. Remember, it is difficult to evaluate and improve a process if you are part of the process because your tendency is to defend and not improve.  Process improvement requires a champion, team approach and continual improvement.
  7. Develop a menu of services from a client perspective rather than a siloed approach. Make sure your packaging, pricing and service offerings meet clients’ wants as well as their needs.  This requires upfront conversations and fixed price agreements that will better define scope, terms and responsibilities.  Do not get caught in the continual commoditization of compliance services.  Package commoditized services along with strategic and performance services in order to increase revenues and margins.
  8. Utilize The Upside Down Budget approach with partners in formulating the firm’s business plan/model.  Start with partners’ desired earnings and add estimated expenses to arrive at required revenue and growth and then develop strategies and personal revenue budgets to reach those goals.  Set partner salaries/draws at a low enough level to provide the firm adequate cash flow and capital.  Do what is best for the firm, not individual partners. Monitor and report on a monthly basis.  You can also drive this down to the staff level if you have good systems, management and communications.  Participation in the process is often as important as the result.
  9. Accountability.  Review progress and communicate with partners and staff at least quarterly.  I know you are busy but you must manage your resources and make this a priority without exception.  Utilize personal 90-day game plans and review them with a positive focus.  Everyone gets better at self-management utilizing this process and the related tools (system).  Staff and partners will focus on priorities and their unique abilities, making them happier and more productive. Accountability is empowerment, not punishment.  Accountability must start at the top with the partners.
  10. Join an association of firms.  Peer comparisons and benchmarking are healthy.  Involve other partners and key individuals (IT director, training, HR, etc.) as well as yourself in these organizations. The return is significant, primarily from the access to expertise, best practices and a support system to maintain and increase confidence. Develop leadership at all levels in the firm.
  11. Content management and workflow are required in today’s digital world.  The technology is available and successful implementation is possible in those firms that establish standards, policies and procedures, and plan strategically, train and have the discipline to stay the course.  There is pain in this initiative but the reward is monumental from a client service, as well as a time savings, perspective. Document management is much like the Fram oil filter commercial, “You can pay me now or pay me later!”  Digital document management has already happened in the accounting profession, it now is a matter of refinement and leveraging the benefits.  It is now possible to efficiently utilize talent in remote locations. Video conferencing is a strategic by-product that is affordable and works for firms of all sizes; think of the savings in travel time.  Do not be afraid to experiment with a team leader at the client’s office and other members working from home or the office.
  12. Cull the herd of low performers and people who do not fit the firm culture.  This may include high-income individual producers who refuse to develop and train others, refuse to delegate, are arrogant and/or who resist change.  The firm cannot afford to have individuals who are negative and distractive.  I am not referring to people who challenge in a positive manner.  I am specifically referring to the bottom 10 percent of producers and those who will not work as a team.
  13. Have fun!  Put balance into your firm and your personal life.  Reward those with a positive attitude.

Do not expect your managing partner to accomplish this list alone.  Success is defined individually but it requires trained players, a team effort, a well designed game plan and an experienced coach.  Leverage your resources and expect progress, not perfection!  Use this checklist to improve your firm and support the leadership provided by your managing partner.  Confidence is the most important factor in success and learning.  Maintain a high level of confidence in your firm and success will happen.

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Dennis Sherrin says...
Posted Tuesday, May 10, 2016
Great lessons, Gary. Thank you.
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