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The Boomer Bulletin - 2011
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Spring Boomer Technology Circle Letter Summary

Posted By L. Gary Boomer, Tuesday, July 12, 2011
The Boomer Technology Circles Spring meetings have concluded and what a 
difference a year makes! The attitude is more positive; firms have many projects and are in need of a road map for the future. Never has a technology plan and budget been more important. I can’t stress enough the importance of spending time upfront thinking, planning and identifying your most important projects along with approving a budget that is adequate to meet the needs of the firm. Many firms have focused on reducing expenses the past two years and it is time to invest in technology, however, make certain you are investing in the right areas.

Business Partner Update

Thomson and CCH presented their roadmaps for the future at several of the meetings. Dashboards and real-time information are hot! So are knowledge management and project management. Forget about the old batch processing systems. Both major software companies have exciting new solutions focused on mobile devices and the cloud. For most firms, it is going to require a transition from on-premise client server solutions to the cloud over a period of time. A few of the smaller firms are almost there and many of the larger firms are planning their transitions over the next 2-5 years. The investment in an IT plan and budget that can be communicated to the entire firm is worth the upfront time. It will save you considerable time and money over the next few years. Moving to the cloud is not just a technology project, but rather a firm project requiring significant change management. I wish it were as easy as some would like to think, but the tools are not in place yet for the mid-sized and large firms to totally move to the cloud. If you are a mid-sized or large firm don’t let this stop you from planning the transition and investing accordingly to your plan. If you want better results you must change your culture and the best way to change your culture is with accountability. 

The Economic Model

While you are thinking about economics, remember that a 1% price increase in most firms drives 3% or more to net income before partners’ salaries. The past two years firms have focused primarily on cutting labor and overhead expenses. A 1% decrease in labor results to about a 1% increase in net income before partner salaries. Where is your firm going to focus this year? 

Mergers

Mergers are certainly on everyone’s minds. If your firm has the "missing structure” (leadership and management, talent development, client develop, technology and compensation) you are probably looking for the right merger candidates. If your firm doesn’t have the "missing structure” you need to invest or look at merger opportunities. Firms are becoming savvier regarding technology and mergers. According to some of the leading firms who have done numerous successful mergers the fully loaded number is over $10k per head. This includes soft costs and transition costs, but ignoring this critical cost of mergers can be costly. It is not just about the hardware and software, but also about the culture and accountability.

Role of the IT Professional

The role of the IT professional continues to change toward a business analyst who focuses on teaming with accounting professionals and focusing on efficiency, innovation and added client value (revenue). Several of the firms are hiring business analysts, while in others; IT professionals are developing the skills of a business analyst.

Salaries

Firms are hiring again, but often at a lower starting salary. The average salary increase is around 5% and is more consistent across the nation than last year. The reason I underlined average is that firms are also doing a better job of holding people accountable and focusing on performance excellence rather than mediocrity. This requires management that is willing to document expectations in advance and have difficult conversations and make decisions if staff and partners are not performing. I include partners, as the trend is toward much stronger partner accountability. Firms are evaluating their partnership agreements and many are terminating underperforming partners. Leadership and management are valued in the top performing firms. Another trend is the evaluation of mandatory retirement ages and work options beyond age 65.

Succession Planning

Succession planning and execution are of utmost importance in firms and throughout the profession. Procrastination is a big obstacle. I can assure you from my personal situation you will not develop a succession plan on your own. It is not only comforting to you, but also your family and business associates when a plan is in place and working. I have a plan and it is working. You can download our Guide to Succession Planning by visiting http://bit.ly/jp5B3x. Succession planning takes time and you must first sell yourself, your family and then the firm. Everyone is different. My advice is to get out of the "rugged individual” mode and get some help. You will be grateful; but your family and business associates will be even happier.

Virtualization

Server virtualization has been around for several years and the majority of firms in the Boomer Technology Circles have implemented it. Three years ago Circle members started to discuss desktop virtualization. At this past session many firms have implemented desktop virtualization and are talking about the benefits. It doesn’t save hardware and software costs in the short term, but does save support and time to market in growth firms and merger situations. Over the long term it will save costs and prepare firms for the transition to the cloud. Firms are using a variety of vendors including VMWare, Citrix and Microsoft.

Talent Management

Firms that can develop talent will be the winners. Awards for best places to work are great, but talent development is the key to retention and attraction. The industry has been a bit foolish from a long-term perspective due to the fact it has limited educational opportunities for staff, especially in the non-technical area over the past two years. In fact, many firms have terminated their training coordinators and learning professions. This short-term trend is starting to change and the best firms realize the advantages of a well-trained staff. Firms that have talent development programs don’t have to worry about retention and attraction. Is your firm promoting excellence or mediocrity?

IPad’s Impact

A year ago only a few Circle members had iPads. Today, a majority owns an iPad and partners rather than IT are the professionals driving this. It is interesting to hear all of the innovative uses firms are finding. People who don’t own an iPad don’t know how they would use one. People who own an iPad don’t know how they would live without it. Yes they are cool and cool is OK in an accounting firm. Apple owns the market and it is going to be difficult for others to compete due to the head start on applications and Apple’s application store.

CIO Advantage Program

We are starting the 2nd class of the CIO Advantage focusing on the leadership, communication, team building, project management, business savvy, and finance skills of the IT professional. The first meeting of the second class will be held on August 16-17, 2011, immediately after the BTC Summit. The progress and development of the first class has been significant. Our objective is to learn from the first class and shorten the development time. This requires thinking, reading, networking, communicating, and change management. The two executives most impacted by change today are the managing partner and CIO/IT leader.

Conclusion

I must close even though I have only touched the surface of the content of our meetings. The peer networking was great. If you are currently a member of the Circles, don’t forget to register for The 2011 Boomer Technology Circles Summit on August 15-16, 2011.  Each member firm can bring three people. Additional attendees will only be charged $595.  If you are not currently a member of the Circles but are interested in joining, please contact us.  The keynote speakers are Rick Richardson, technology visionary and Colonel Greg Gadson, director of the US Army Wounded Warrior Program. You can expect enlightenment, entertainment, laughter and motivation. I hope to see you in Kansas City, MO in August!

About The Boomer Technology Circles

The Boomer Technology CirclesTM community will help your firm bridge the gap between technology and practice management and accelerate your progress through thought leadership and peer accountability.To learn more about The Boomer Technology Circles, please visit http://www.boomer.com/?page=TechnologyCircles.  

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