Posted By Scott Morrill,
Tuesday, December 13, 2011
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My coaching philosophy is best summed up by the following statement: "Winning is everything – but the score at the end of the game doesn’t define winners and losers.” Sure, that sounds like coach-speak from someone who’s used to losing a lot of games. But the point of the philosophy is that the length of the game is somewhat arbitrary and it can be dangerous to let it unduly influence a team’s strategies.
I believe that the "length of the game” can also unduly influence business practices. In this article I’ll use an example from sports to help clarify my point and then ask you to reevaluate your core values. As a shortcut in this article, I’m going to label the "length of the game” as the "time metric”.
I think that we would all agree that the time metric is a
necessary and useful tool. I think we’d
also agree that winning and losing are both important motivational factors that
we use in making life and business decisions.
What I’m going to be arguing is that over-valuing short term
measurements is a factor in creating an epidemic of problems throughout our
Can Losers Win and Winners Lose?
Sports and games often mirror serious real-life situations so
they can be used to teach core values that can be applied when facing real-life
decisions. To the uninitiated, many
sports appear to be silly games played for entertainment. However, to those who coach and play, they
are learning tools for skills like hand-to-hand combat, decision making, teamwork
and strategic thinking.
In a few months, 68 college basketball teams will
participate in a tournament to determine a national champion – a team that will
be long remembered as the best college basketball team of the 2011-12 season. One team will win and 67 teams will lose. You’d think it’d be a pretty conclusive
system for defining winners and losers.
But games are often won or lost based on the outcome of things beyond the
control of the participants – an injury to a key player, an official’s error,
an underdog being able to overachieve in one special game. There have been seven national championship
games decided in overtime and another four determined by a single point. In addition, many eventual champions survived
at least one game whose outcome was determined on the last play of the game. So is the winning team really more successful than the losing team? Would changing the time metric impact your
decision? In other words, would the
results be different if the game were but a few seconds shorter or longer?
In case you’ve forgotten, the University of Connecticut (UConn)
defeated Butler for the national championship in college basketball last
year. Both programs developed strategies
and made sacrifices in order to earn their way into that specific championship
game. But for the next three years UConn
will be penalized for recruiting violations – violations which weren’t proven
to have impacted the game but which introduced some suspicion about the core
values of the program.
When measured on an annual time metric, UConn is a winner
and Butler is a loser – and to me, that’s indicative of a danger. The problem is not in having a time metric
but in valuing the short term result more than the long term impact. Greed, for lack of a better word, describes
the motive that drives one to sacrifice one of society’s core values for a
short term result.
Greed is defined as an excessive desire for wealth or power,
often more than one’s proper share. Consider
how the excessive desire for wealth or power played a role in other stories that
dominated the sports page this past fall – conference realignment and the NBA
But I Thought "Greed Is Good”
When measured with a short-term time metric, greed looks
good. UConn fans get to celebrate a rare
accomplishment, schools get to develop new rivalries and NBA players and owners
eventually reach a compromise that everyone can live with for several
additional years. However, greed is not
free of consequences. In each of those
examples someone is being hurt economically.
Now let’s turn to topics in the real world.
There’s a Revolution Against
- Global recession – which according to the
Senate’s Levin-Coburn report was "the
result of high risk, complex financial products; undisclosed conflicts of
interest; and the failure of regulators, the credit rating agencies, and the
market itself to rein in the excesses of Wall Street.”
Nuclear Ambition – will the quest for ultimate power trigger the next war?
deadlock – where the desire to win elections every two years trumps the core
value of working as a team.
warming – we’ve only been drilling for oil a little over 150 years. What happens if we have to live on this
planet for another billion?
Dictators can probably be considered the grand masters of greed
and Arab Spring is the current actual revolution against greed. But rival drug cartels have been fighting the
Mexican Drug War and Mexican President Felipe Calderon has employed 45,000
troops in their country’s fight against the cartel’s greed.
In the United States, the Occupy Movement appears to
essentially be a statement against greed.
Initiated as a protest against the influence of Wall Street, it has now
morphed into a complaint about the concentration of wealth among the top 1% of
income earners. Although I think it’s a
revolt against greed, I personally think they have misidentified the
greedy. Greed and charity exist at all levels
of economic circumstances.
The Responsibilities of the
Most Trusted Advisor
This is a great year for the accounting industry to step up
and take a role in reestablishing credibility within the corporate world. Reeducate about the value of audits. Help your clients find competitive advantages
so they aren’t tempted to violate core values.
Above all, adhere to your own core values. Here are three important steps that you
First, take an opportunity to spend time reviewing your core
values during your annual strategic planning summit. Make sure that your staff understands the
meaning and importance of each principle.
Spell out the responsibilities for new hires and those with generational
and cultural differences.
Second, lead by example.
There is a moral attributed to an ancient Chinese philosopher, "don’t
lie for me because if you can lie for me, you can also lie to me.” It’s hard to lead others on a path you’re not
willing to travel.
Third, don’t over-value the short term time metric. Don’t compromise your core values for
something that might not be important in the long run. Rebecca Ryan compares making life decisions
to juggling. "Some of the balls we
juggle are made of rubber and some are made of glass. You can drop a rubber ball without damaging it. But core values are like glass balls. If you drop one you’ll never be able to
completely restore it.”
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Posted By Sue Thiemann,
Monday, December 12, 2011
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Your biggest season is coming soon. This is your opportunity to stand out from the competition.
Are you ready? Do you have a plan? Have you put in the effort to properly prepare your firm members?
As Greg Cordell, CIO (Chief Inspiration Officer) and author
of Brains on Fire puts it: "Your Company
is the stories people tell about it.” Everyone has a story about their annual
tax preparation or their experience with an accountant’s office. Some are stories are great and other stories are a
What stories will your clients tell about your firm?
We are all aware of how critical it is to look at what we
do from our clients’ perspective. How
often do you stress to the firm members to produce, produce, produce? So what
does the member do? Rush immediately to the tax return or accounting issue
without making a connection with the client.
While often times marketing efforts are you talking about yourself and
what you can do for them; stories, on the other hand, are others talking about
you and their experience with your firm. Marketing campaigns embrace an "us-versus-them”
mentality. Stories can say, "we’re all in this together.” Relationships create
the positive stories others tell about your company.
So let’s get down to the basics; it’s about people. It comes down to trust. People don’t trust
companies; people trust people. People
they know. People whose opinions and recommendations they seek out and have
faith in. They rely on word of mouth (stories) to determine their choice in
firms to employ for their business needs.
Again, what stories will your clients tell about your
Like it or not each person in the firm is a part of the
story of your firm. Each person should consider their approach or conversations
with your clients. It’s about reframing the conversation or the focus from the
"me or my firm” mentality to the "us” (you and your clients) approach.
Reframing the conversation is about going from what role does our service or
product have in people’s lives to what role can we play in our clients’ lives.
It’s a turn from a service or product role to a relationship role. Connect and
develop a relationship with the client first and always.
So what is the value of client relationships? According to Jim Simon, author of Hidden Champions of the 21st
Century, staying close to your clients compels performance and innovation. Strategies
become driven by value – client value, not price, so these companies can charge
more for their products or services. Regular contact and conversation and being
on a first-name basis with your clients significantly impacts the stories told
about your company.
So, what stories will your clients tell about your firm
in 2012! Make every conversation an experience in and of itself.
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Posted By Sandra Wiley,
Monday, December 12, 2011
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The dawn of a new year enables firms to establish new strategies as well as instilling
sense of urgency for opportunities. As firm leaders begin to set their agenda, now is the time to look ahead at the trends that will drive your talent initiatives in 2012.
In 2012, firms will seek to return to higher profits. More emphasis will be placed on higher production and getting the most from the established group of core talent that we have recruited and developed. The beginning to the middle of the year may see a continuation from the previous year. However, as the economy gains momentum, trust will return and ultimately will bring more activity to our industry.
More activity will bring a list of strategic objectives that every firm will need to consider thoughtfully as they work to strengthen their talent initiatives.
- Dealing with survivorship – A concern of many employees’ that has not been addressed in most firms is the feeling of survivorship from the mass terminations during the recession. Many of these individuals have been busy producing, and for some producing more than was expected before the downsizing. There is now a feeling of being overworked and underappreciated. The amount of work that has consumed our talent pool has left little time to learn new skills, communicate effectively and concentrate on projects. The feeling of un-ease may create an environment where the team may quietly start looking for other opportunities, expecting an adjustment in their compensation or the expectation that management needs to hire additional staff to help relieve the workload pressure.
- Slow return to hiring, faster return to productivity – With many partners concerned about profits, hiring will return, but very slowly. Firms did not like to "trim” so they want to be sure that they need the new staff long term before making the decision to add staff. In fact, many firms are choosing to hire temporary workers to fill voids in short-term projects, primarily to keep overall expenses down including benefit costs. The lack of mid-level talent will also play a role in the outlook for 2012. This could mean losing some of your mid-level team if they do not feel as if they are being treated fairly or the ability to hire a new team member as individuals start to feel more comfortable with the economy.
- Training and self-development – A tremendous amount of money was spent on training and development prior to the recession. However, during the recession, many firms reduced their training professionals or stopped training initiatives as they contained expenses. The return to normalcy in the training arena will be very slow and may never return to pre-recession levels. In many cases firms had a difficult time seeing the return on their investment. However, firms are already beginning to change their strategy in this area as they see the need to develop their talent for succession purposes. They are becoming motivated due to the questions that are being asked by highly qualified candidates who expect – and in some cases demand – a training plan before they join the firm. Firm leaders are re-investing in the learning and training initiatives within the firm.
- Leadership challenges – During the 1960’s through 1980’s succession planning was a major initiative in firms. The story of starting out as a staff accountant and climbing to the partner level was not only a dream but also reality. Presently there is a distinct lack of succession planning in firms of all sizes. This issue has created a dire shortage of leaders and future leaders. Without proper leadership, firms lack strategy and direction. There is an increasing need for written succession plans for each leader as well as a well thought out development plan – including sponsorship of the super stars to insure the future of the firm is protected.
- Accountability – The lack of setting and meeting firm goals has stressed leadership. Good times of the past allowed for flexibility. However, as profits tighten and time seemed to be scarce, the lack of accountability sunk even lower. As we look ahead, great leaders understand that developing goals, sharing the overall plan with the team and then holding everyone – especially the partners – accountable to the goals leaders required managers to tighten controls. Difficult times require a return to fundamentals and more stringency for managing by objectives.
- Customer service – Technology and globalization has increased competition. Client to client influences are more prevalent than ever. With the popularization of social media, client testimonials can either elevate the brand or simply implode it in the blink of an eye. Firms have been slow to determine that the purpose of business is the acquisition and retention of clients. In fact, it is the competitive differentiator. Firms will work very hard on the organizational culture and interactions with clients. The impact will reap huge benefits for the bottom line.
- Frugality versus extravagance – Without sounding trite, desperate times requires desperate measures. Yet the return to better times will not necessitate a return to bigger spending. Firms previously spent unwisely on travel, meetings and other expenses. The New Year will be a continuance of frugality. Leaders realize that the pre-recession extravagance led to similar results experienced during lean times. Frugal with a slant toward "investment spending” will be the theme for 2012. Investment in training, salary increases and re-establishment of bonus plans will return.
- Turnover – The new economic climate provides more opportunity for expansion. Surviving employees, new talent and simply those desiring change will leave their firms creating an intense drain on knowledge and production for some and an opportunity to strengthen for others. To insure that your firm ends up on the right end of the spectrum, identifying what your talent pool values is important. Focus groups, stay interviews and continued communication and training will be imperative. If your employees don’t find what they want in your firm, they will most assuredly find it in your competitors.
- Ethics - Simply mention the names Bernie Madoff and the Lehman Brothers and the first word that comes to mind is ethics. Ethics are the nexus of any firm. There will be an increase in employee background checks, training and development and hiring of human resources professionals to maintain compliance. The client-to-client influences are too strong to dismiss this vital issue.
- Optimism - First and foremost, the New Year brings the opportunity to look ahead to better times. The choice is yours, develop strategies around your talent that will brighten your future or be left behind in a highly competitive environment.
An excellent opportunity to get off to a great start in 2012 is to consider sending your Administrative Partner, COO, Firm Administrator or Training Professional to "The Talent Development Advantage” on February 28 and 29, 2012. Go to http://www.boomer.com/?page=TDA
and check out all of the details of this amazing event.
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Posted By Sandra Wiley,
Wednesday, November 16, 2011
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The future leaders in our
profession are sending us a message about how
question is, are we listening? They are
saying "We don’t know everything and
we don’t have to. What we have to do is develop our unique
talents and let others develop theirs while blending them collaboratively
together. That is how we will lead the
firm of the future”. At first blush, many current firm leaders might say "they
are naïve, just wait until they grow up”.
I would respond by simply saying – read on.
The future leaders in our firms have a keen
understanding of self, and they understand that while they have many fantastic
traits, they are not a superstar at everything.
They push back strongly saying
that in the firm that they build, it will function vastly different than the
one they work in today. Their firm of
the future will be more collaborative and cohesive. These young leaders have been fearless about
change in their lives and that will carry through to the way they build their
firm. Culture, systems and processes
will all change for them, and ultimately will change the entire industry. The secret to all of this change is one
person will not be responsible to create all of this change; it will be a
collaborative – "group think” – mentality that is based on intellectual
So, what are the changes that will take
place in the future?
Change #1 - Collaborative Relationships are King
lone rangers allowed will be the battle cry from leaders. Today, when a new idea develops in a firm, it
is often one leader coming to the group and selling their idea. Then, the idea is implemented by a
committee. In the future, the idea will
be developed by a group of people from the inception and then the entire group
will continue to support and nurture the idea by bringing in other team members
as needed to make the idea better. The
thought process is "let's all sit down at the table and figure this out –
together”. The pattern that will
develop, and ultimately make a good idea a great idea is that by pulling together
everyone’s ideas, thoughts, intellectual capital, the firm will benefit from
the "group think” rather than "individual think”. As you might imagine, there will be little
room for individual egos in this environment.
Silos within the firm will deteriorate and power teams will emerge.
Change #2 – Globalization and Diversity Will Be
today have a reputation for being predominantly male, white and aging at the
partner level, female, middle aged and white at the manager level and slightly
more diverse in race, gender and nationality at the staff level. Given the changing demographics of our
country today, and the reality that our younger leaders have a more diverse and
global outlook of the world, it is safe to say that the "look” of our firms
will change in the future. We are going
to be more colorful and more widespread in our human resources. This is a welcome change by our younger
leaders who have gone to school and often traveled the world with friends of different
nationalities and cultures.
Additionally, this change will require that we put a stronger emphasis
on retention, attraction and motivation of the best talent, and find new ways
to solidify our teams.
Change #3 - Digital Lifestyles and Skills Will Shape
may be a change that most people would simply say "Duh” to. We all realize that digital skills are
changing the leader of the future. The
fact that our future leaders don’t understand why this is a game changer should
tell us something. The majority of our
young leaders have never known a time when they did not have a computer in
their home, and many don’t have any idea what it would be like to go out for an
evening and not have a cell phone to communicate with. This digital lifestyle will never go away –
it just is! Also, keep in mind that as
our young leaders are built this way, so are the young clients that they will
interact with. This new digital reality
is certain to shape the firm of our future.
Change #4 - A Sense of Purpose and Dedication
interesting trait that will be a game changer for the leaders of our future
firm is that these leaders will be less concerned about their own goals and
more concerned about their overall team.
This goes back to change #1 in building the relationships, but it also
emphasizes that this group of people have been programmed from their growing up
years to care for their community and others.
Think about the youth of today and how they are taught, motivated and
rewarded in schools today to care for their community and work with their
classmates on projects. They will never be satisfied in their work life not
using these skills to develop a sense of purpose and dedication for the overall
firm and team, not just themselves.
Change #5 - Mentoring Is Out, Sponsoring Is In
leaders are not uneducated, and they are realists that not everyone is going to
want grow at the same time or the same pace as the next person. They also realize that not everyone has the
aptitude to be promoted to leadership positions. Rather than developing
mentoring programs where everyone is treated exactly the same, they will opt
for picking the players that are the best and then developing a close
relationship with that person to sponsor them and grow them into one of the
leadership positions that is required in the firm. Even though some of them were raised
in an environment where everyone got a blue ribbon or a gold medal, they
understand that "one on one” sponsorship will provide an individual with the
training that is best for them and far more productive and valuable than a
program that is "one size fits all”.
Change #6 - Health and Well Being Are Essential
a world where obesity seems to be the bane of our existence, the next generation
leader will understand and support a work environment that promotes the physical
and mental health of their team. Through
education, experience and a world that is fighting to control the balance
between life and work, this new leadership group will put more emphasis on
healthy lifestyles both in the office and outside the office. The reward will be higher productivity,
morale and retention rates.
With all of these changes upon us, how can
the current leadership group help prepare and start implementing today?
Change #7 - Team Development and Hiring Changes
your current team and begin to look critically at the skills that are not in
your firm today. Are you a firm that is
full of researcher oriented people, but the number of process oriented project
leaders are lacking? Or, do you have a
firm full of introverted followers who take direction well, but not many
individuals who are hungry to "own” responsibilities and want to lead initiatives
in the firm. After you analyze your
current situation, then prepare to hire for more than the technical needs of
today, but also the leadership needs of the future. Firms absolutely need skills and abilities,
but they also need emotional intelligence.
This will require analysis, new hiring skills and a dedication to
changing old habits. Remember, if you
continue to hire, promote and motivate the way you have in the past, you will
get the same talent you have had in the past, and that will not be good enough
in the future.
Change #8 - Form a Future Leader Initiative
must listen carefully and hear what their people are telling them. Leaders must also understand that putting
together the leadership of the future requires that they look at each person as
a separate and unique individual – identifying the unique characteristics that
they have and allowing them to develop those skills. Just because someone is not the best business
developer does not mean they are not valuable, they may indeed have a gift for
putting processes in place that will save the firm hours in productivity and
efficiency. Another person who is a superb
business developer, may not like to research new systems and the leader sees
that their motivation will come from front stage projects dealing with client
and prospect interactions. One is not
wrong or less valuable, both are equally amazing. A positive way to find out what is floating
around in your future leaders minds is to form a "Tomorrows Leaders Initiative”
in your firm. Give them objectives, but
let them figure out the strategies, ideas and timelines for initiatives that
will help the firm prepare for the future.
Change #9 - Get Flexible With Learning and Training
some firms are still struggling to develop cookie cutter learning ladders and
training plans that will work for everyone in the firm, the firm of the future
will have career planning and learning ladders that are much less linear and
far more individualized. Flexibility
will be imperative and lateral moves will be much more accepted and encouraged. This would be an excellent project for a
Tomorrows Leaders group to work on.
Change #10 - Replace Pen and Paper with Real Words
are a paper and pencil kind of world when it comes to feedback and performance
are an industry that is nice and caring. Often, this translates to thinking
through how you want to nicely give someone feedback on their performance,
writing it down and then delivering by letting them read what you wrote. The verbal exchange is short, sweet and to
the point, and often has not intrinsic value to the team member. Progressive firms today are teaching their
leaders to have verbal exchanges with their team members and using the paper as
simply backup to the conversation. These
conversations are critical to developing the relationships that are valued by
the individual and to enact the performance that we desire from each
person. Some will think this is contrary
to the digital lifestyle that this younger leader is accustomed to, but it
plays well into the close relationship that they are hungry for within their
Is this new leader, and new
leadership style of the future complicated? Yes! Is it rewarding? Absolutely! As
we approach a new year, I challenge each of you to rethink your current
leadership style and commit to making changes that will assist your firm is
taking positive steps toward a firm that future leaders will be attracted to,
and will be excited about helping to build.
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Posted By Jon Hubbard,
Wednesday, November 16, 2011
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Zappos.com is an online store and apparel shop. It was started in 1999 and in
acquired by Amazon in a deal valued at over $1.2 billion. Zappos has set itself apart from other online
retailers by having a passionate focus for customer service. Most online retailers go after having the
lowest price or the largest selection, but Zappos chose to focus on customer
service because they felt it was the biggest value they could offer their
Through Zappos’ insane (or not so insane) focus on customer
service, they have created a company culture that is known around the world.
Courses have been developed, books have been written and companies have been
started with the goal of communicating and replicating the unique and
profitable culture Zappos has created.
In this article, I will highlight 3 key aspects of the Zappos
culture with the purpose of getting us to think about how we can apply similar
aspects to our firm.
Your culture is your brand
a brand today is much different than building a brand 60 years ago. In the past, the executives of a company
would meet and decide how they wanted to brand and position the company and
they would then spend a lot of money on advertising to communicate the message.
While marketing and advertising are still important, they do have limitations. Zappos believes the best way to build your
brand for the long term is to develop a strong culture. Once the culture is
established, other areas of the business such as customer service, building a
great reputation and attracting passionate employees will happen as a result. Zappos has 10 core values that shape their
- Deliver WOW Through Service
- Embrace and Drive Change
- Create Fun and A Little Weirdness
- Be Adventurous, Creative and Open-Minded
- Pursue Growth and Learning
- Build Open and Honest Relationships With
- Build a Positive Team and Family Spirit
- Do More With Less
- Be Passionate and Determined
- Be Humble
To learn more about each of Zappos’ core values and how they
shape their culture, please click here
. I do not think that every CPA should have
these core values. Your firm should be
unique and should have a unique set of core values that everyone is passionate
What steps can your firm take to make the core values truly
influence company culture?
Creating a passionate team
goes to great strides to have employees that are passionate about their 10 core
values. Without passionate employees,
the company culture will sputter and will not be a competitive advantage. Zappos starts with the hiring process. They hold two sets of interviews, one interview
focused on technical ability and experience.
The second interview focuses on the culture and the 10 core values. Once an applicant becomes a new-hire, they go
through a 4-week training process at Zappos call center, no matter what their
job title is. During the first 2-weeks the new-hire is educated on company
history, importance of customer service, and company culture philosophy. During
the last 2-weeks, the new-hire will takes calls from customers. At the end of
the training, Zappos makes an offer to the entire training class. They offer
everyone $2,000 to quit (plus what they’ve already earned during the training).
Not surprisingly, less than 1% take the offer. Although this process is a
little unconventional, it helps ensure the company is being strengthened with
Also, Zappos regularly measures the strength of their
culture through regular employee surveys that asks employees whether they agree
or disagree with the below statements:
- I believe that the company has a higher purpose
beyond just profits
- My role at Zappos has a real purpose – it is
more than just a job
- I feel that I am in control of my career path
and that I am progressing in my personal and professional development at Zappos
- I consider my co-workers to be like my family and
- I am very happy with my job
What steps can your firm take to ensure the hiring and
retention of passionate employees?
Create fun and a little weirdness
good would a company culture be if it wasn’t fun and a little weird? Not super weird, just a little unconventional
to add some humor to everyone’s day.
Zappos celebrates and embraces diversity and each person’s
individuality. They want their people to
express their personality in their work.
They feel strongly about this because they feel their employees will
perform best when they can be themselves.
A great example of Zappos employees creating fun and a
little weirdness is their finance department has a weekly parade called "Random
Acts of Kindness”. They march down the
hallway to 3 employees desks and present them with a gift, put a hat on them
and take their picture.
A great side effect of encouraging fun and a little
weirdness is that it encourages creativity and innovation. When employees are more engaged with their
work the company as a whole becomes more innovative.
What steps can your firm take to create fun and a little
Zappos is in an entirely different industry than we are, I believe we can learn
from what they have built and implemented at their company. It is important that we consider what our
firm’s purpose is and take steps to building a culture that supports it. No two
companies are exactly the same nor should the cultures. Without fun and a
little weirdness, we won’t get too far.
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Posted By Arianna Campbell,
Wednesday, November 16, 2011
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The year is coming to an end and this is a time to reflect
on successes of the past
year and areas
of opportunity for the year ahead.
Personal improvements are often the focus of New Year’s resolutions, but it is
important to not overlook changes that can be made to increase productivity and
profitability in your firm.
The 7 Habits of Highly
Effective People, by Stephen Covey, is filled with practical suggestions
for making changes that will result in a better lifestyle. While the principles
have personal applications, they are also relevant in your firm. The following
habits can be implemented to achieve a higher level of effectiveness in your
Habit 1: Be Proactive
"Proactive people do more than take initiative. Proactive
people are agents of change.” – Stephen Covey
Change is inevitable, and being reactive to change usually
causes feelings of chaos and lack of control. When this happens in a firm it
can result in decreased profitability and productivity. Taking the initiative
to evaluate your firm’s dangers, opportunities and strengths (D.O.S) is an excellent
way to identify areas where the firm can be proactive. This will create awareness
of dangers to avoid, take advantage of opportunities, and maximize strengths. A
tool that will help define these areas in your firm. The findings can then be
used to put together a plan instead of handling challenges and opportunities as
For increased proactivity, team members can complete a D.O.S
assessment for their role in the firm. Knowing the collective D.O.S of the
members of the firm combined with the D.O.S for the firm as a whole will give a
clear guideline of how to stay ahead of the curve. This approach will allow
change to be driven by the firm instead of having a firm driven by change.
Habit 2: Begin with
the End in Mind
"Begin with the End in Mind is based on imagination – the
ability to envision, see the potential, create with our minds what we cannot at
present see with our eyes and conscience.” - Stephen Covey
Having clearly defined goals is an important element for
being a highly effective firm. A strategic plan is essential an essential
roadmap for firm success. It should include firm strategies and objectives with
deadlines and responsibilities assigned. L. Gary Boomer says the following
about the importance and benefits of documented strategic planning: "In order
to maximize your profitability, you need a written plan detailing your firm’s
strategy. This will reduce the time required, build consensus, provide
consistent communications, and insure accountability.”
Once the plan is in place it should be shared with the
entire team to ensure that everyone is working towards the same goals. The plan
should be reviewed throughout the year to help the firm stay on track, and
adjustments should be made as needed.
Habit 3: Put First
"Highly effective people do not really manage time – they
manage themselves. They are planning and executing according to their highest
priorities.” - Stephen Covey
Once a strategic plan is in place and goals and responsibilities
are clear, the challenge to stay on track begins. It is easy to be distracted
by daily tasks and projects that may arise beyond the strategic plan. The key
is to use the firms goals as a guide to prioritize and make sure that even your
daily tasks are in line with the firm’s plan.
is a tool that can be used to define projects and goals for a
shorter time frame. Each team member should create a Game Plan at the beginning
of each quarter with goals that are in line with the strategic plan. At the end of the quarter Game Plans should
be reviewed with coaching and recognition as needed.
Habit 4: Think
"Win-Win sees life as a cooperative arena, not a competitive
one. Win-Win means agreements or solutions that are mutually beneficial and
satisfying.” – Stephen Covey
A culture of cooperation instead of competition is essential
to making your firm operate at the highest level. In a Win-Win environment,
everyone is working together to achieve the strategic goals for the firm, and each
individual’s successes contribute to the success of the firm. This requires
dedication to the firm’s value system, a commitment to clear communication, and
respect for each person on the team.
Habit 5: Seek first
to Understand Then To Be Understood
"In order to have influcence with other people, they must first feel that you understand them. And once they feel understood, they are open to hearing your ideas, your counsel and your point of view." - Stephen Covey
Understanding your clients is an important part of being a highly effective firm. When you are working with clients with needs that are aligned with your firm’s strengths, you are likely to be more profitable and productive. In order to select the right clients, you must first understand their needs. If you ask the right questions to new and existing clients, you can maintain the good relationships and identify those that are not a good fit.
The next step is to use what you have learned from your
clients to build strategies to find and retain clients, as well as how to end
relationships that are not mutually beneficial. In addition, understanding your
client’s needs will help to manage both internal and external expectations and
keep the firm operating at a high level.
Habit 6: Synergize
"Synergy is celebrating differences, teamwork,
open-mindedness and finding new and better ways together.” – Stephen Covey
Each person in your firm has a unique ability that makes
them a valuable member of the team. When people are allowed to use their
talents in their job, they are more likely to enjoy their work and be high
performers. No one should expect to spend all of their time working in their
unique ability, but finding opportunities for team members to integrate their
best skills into the job will have a positive effect on the firm. Unique ability combined with teamwork will
accelerate your firm to the next level.
Habit 7: Sharpen the
"Just remember that every day provides a new opportunity for
renewal – a new opportunity to recharge yourself instead of hitting the wall.
All it takes is the desire, knowledge and skill.” – Stephen Covey
Be mindful to never stop learning. Make sure that your firm supports and
encourages a learning environment. This can be done by creating training and learning
plans for everyone in the firm and for the firm as a whole. Continual learning
will help to keep your firm and team members ahead of the curve.
When the principles listed above become habits for the firm,
the level of effectiveness will increase as a result. Remember that creating
new habits take time, commitment and patience but the results in firm
profitability and productivity will be long lasting.
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Posted By Ken McCall & Chris Gryskiewicz,
Tuesday, October 18, 2011
| Comments (0)
The challenge of managing a CPA firm has never been more
difficult than it is today. Firms of all
sizes are grappling with volatile economic conditions, changing expectations by
clients and staff, and rapid evolutions in technology. Is there some magic solution that will bring
all this into harmony and allow the firm to cruise calmly forward into the
future? Hardly! But, firms positioning themselves for success
will usually look for a careful alignment of people, processes, and technology.
The first essential for this alignment is a shared vision
of the future, articulated clearly in a written strategic plan. One thing that a strategic plan will reveal
is that to be successful, a firm needs a commitment to growth. A commitment to growth doesn’t necessarily
mean more people, but it does demand that the staff on hand be as efficient as
possible. Part of this focus on
efficiency will likely mean developing staff members and empowering them to
work effectively from wherever they might be.
Most firms have some experience with staff working non-traditional
hours, or working from home, or simply keeping up with their workload while
traveling. This requires the technology
to make flexible work opportunities possible.
Good firms view technology as a strategic multiplier, not
an overhead expense. But all the
technology in the world won’t make much difference if the firm doesn’t commit
to refining processes and procedures to take advantage of the opportunities
technology presents. Technology and process go hand-in-hand: new technologies make new processes possible
while new processes are necessary to get the most out of the technologies
Fortunately, the tools required to achieve this alignment
of people, process, and technology are available across a wide spectrum of firm
sizes. Firms as small as 20 or so staff
and a few partners have one set of needs and opportunities; multi-office firms
of several hundred staff and a diverse partner group have yet another. In both cases, however, partners must be
free to focus on client service while using automated processes for maximum
efficiency. We will look at how well-integrated
practice management software will allow both large and small firms to meet
their own special needs.
One way to improve results is to carefully review
traditional ways of doing essential functions. These functions include the sales and
marketing tools used in client development, the ability to forecast staff
availability and assign the right staff to a job, the ability to build accurate
job budgets to ensure profitability, and the full integration of Work in
Process (WIP) and Accounts Receivable (AR) into the firm’s own General Ledger (GL)
Most firms have a variety of back-office systems in which
they track multiple interactions with prospects and clients. Far too often, these related functions are
tracked in entirely separate systems, limiting the firm’s ability to share critical
information at the right time. These
firms miss the competitive benefit of a full relationship view of all interactions
with prospects as it nurtures them toward becoming clients and they miss the
benefit of leveraging firm contacts and experiences with existing clients in
new pursuits. Once a "prospect” becomes
a "client”, then the traditional time, expense, and billing processes come into
play. Combining those into a cohesive
firm-wide relationship data base yields significant dividends but it doesn’t
just happen, it requires a marketing plan and executive vision.
Once a client engagement is secured, the key to maximizing
the profitability of the engagement may have already been lost. Most sales processes emphasize winning the
pursuit first and then consider profitability after the fact. The assignment of the proper staff to the job
and the development of an accurate budget for the labor costs to be incurred
are deferred until the time the project is initiated. Firms use a variety of tools to do this,
ranging from specialty software applications to the ubiquitous
spreadsheet. This process typically
involves separate data sources limiting their ability to share common
information across applications.
One of the most frustrating examples of the lack of
integration comes from the firm’s own internal accounting process. Many firms use a traditional "time and
billing” application to track time and expenses, accrue WIP, and track AR after
invoices are issued. Far too often,
however, these asset balances are not integrated with the general ledger
accounting system and require one or more journal entries to produce the firm’s
own financial statements. The real
breakdown in this system is the inability to "drill down” into the financials
and analyze source information without resorting to multiple applications, each
with its own database. Perhaps even more
damaging is that most systems do not integrate a preview of the engagement’s
likely profitability into the pursuit.
As a result realization and profitability not known until the final
invoice has been paid.
A step toward simplifying these back office processes is
to move from a mixed array of software technology to a fully integrated
Practice Management system which brings all these features together with a
common shared database.
Templeton Solutions, LLP, a technology consulting company,
and a division of Templeton & Company, LLP an accounting and management
advisory firm with offices in West Palm Beach and Ft. Lauderdale, Florida has
done this with their system TC Practice Management (TCPM). Providing time and
billing, sales and marketing, project management, document management and
analytics, all built on top of Microsoft Dynamics CRM 2011. TCPM offers an
intuitive interface delivered directly from Microsoft Outlook. With a single
log-in and folders visible on the left side of your screen linking you to the
applications, the program is fully integrated and designed to provide a cycle
in which to manage your business – from sales and marketing, to prospecting and
planning, to winning and creating the project, to forecasting, to time and
expense input on a periodic basis to generating invoices for clients.
The Sales & Marketing function of the system manages
contacts, clients and opportunities in a single location, charting the prospect
to client process. Ultimately, firm leaders can see an estimated project
realization before the opportunity is won. As in standard CRM, interactions are
documented by emails, tasks, appointments and notes, and that information is
also saved into Outlook. CPAs can look up the zip code where a client is
located, the business type, the address, and have the ability to verify data as
it is entered.
Once a project work plan is created by a team leader, it
can be confirmed as the project’s budget and used to benchmark the actual time
for completion with a preview of the project’s realization before work had
begun. When a particular professional
service is chosen as an opportunity within TCPM, a unique template of standard
work steps or "tasks” for staff is presented. Those tasks come with an
estimated time of completion and a fee based on the staff levels needed to
complete the project. Once a prospect becomes a client, managers will be able
to view the actual time vs. planned time on a day-to-day basis. Ultimately this
function allows forecasting and a better understanding of time management for
each staff person. Team leaders can now see which staff person is working on
what, if time revisions need to be made, the rates per hour and how work is
distributed between staff members.
For the firm to run efficiently, decision makers need
timely and accurate information. This
means having the right information (not cluttered up with unnecessary
distractions!) presented naturally, in a clear and concise form. For many firms, this will mean rounds of customized
reporting to get the information the partners need and oftentimes supplemented
with individual spreadsheets where the reporting falls short or is suspect.
The high payoff activity in streamlining reporting is the
consolidation of databases without the costly effort of developing data
warehouses. Instead of going to multiple
places to change or enter common information, do it once and let the
applications share the data! Instead of
drawing information from multiple sources, and compiling it for reporting
purposes, let the reporting application draw upon the information it needs! Best of all performance metrics are available
in real-time – which offers powerful tools for management and accountability at
all levels of the organization.
TCPM promotes a growth strategy supporting the philosophy
that the clients belong to the firm, rather than to individuals or practice
groups. The program allows managers and staff a bird’s eye view of the business
and practice management processes happening at all times. Assessing clients
across industry segment and service areas enhances cross selling ability and
creates a one-firm concept. Each individual staff person can look at their
billable goals and from their own dashboard view see how they are doing while
their managers see how they are measuring up to others on the team and within
the firm. Open and pending WIP and prior
Progress & Final Bills can be viewed in a single location and workflow
notifications of pending tax and project deliverables are also easily
accessible. Within the program’s time and billing capabilities, the Biller’s Workbench
is a powerful one-stop resource for project/billing managers to quickly
generate bills and see the impact of billing decisions on realization.
So far, we have examined many benefits of a fully
integrated Practice Management application with a shared database and common
user interface. These benefits are
enhanced even further, and implementation and training become simpler, if the
system is built upon industry standard tools.
Some of the most common (and most powerful!) back office support tools
come from Microsoft. Specifically, these
include Microsoft Dynamics CRM and Microsoft SharePoint. These tools have the advantage of being
available for an "on-premise” server installation, or in the Software as a
Service model "from the cloud”. In
either configuration the integration described above is readily available. Smaller firms with less robust internal IT
support may find the cloud model appealing, while larger firms with more
engineering expertise available may opt for the on-premise model. In actuality, though, either model can fit
well with either firm profile allowing clients to choose the deployment option that
is right for them. Clients or prospects looking to transition to the cloud can
take their time – knowing they can make the move without buying additional
software or building out new infrastructure.
Using a standard set up to start, Templeton Solutions
tailors TCPM to individual firms helping with initial data organization and
setup. Clients then take over to decide
their service lines, tax codes, output templates, etc... A firm administrator is trained to support the
firm’s ongoing configuration of TCPM to meet their specific needs. Typically the implementation process lasts
about two weeks but most important is a two-day event that includes the project
owner and more progressive leaders in the firm that helps them design and own
Rising to Meet the
At the outset of this article, we recognized that large
and small firms alike are facing unprecedented challenges to profitable
operation. The key to profit in today’s
environment is efficiency, and efficiency comes in large part from simplified
and integrated back office operations.
Achieving these back office efficiencies becomes much easier when the
tools are based upon industry standard applications. TC Practice Management, built upon Microsoft
Dynamics CRM and Microsoft SharePoint, provides robust back-office integration,
flexible installation configurations, simplified licensing, all built on
industry standard platforms.
Templeton Solutions is primed to offer a practice
management system because of their association with Templeton & Company.
They’ve put their everyday working knowledge of what it’s like to be part of a
CPA firm into practice – as the vision and direction of TCPM came directly from
the founder and partners of Templeton & Company resulting in a solution for
CPAs designed by CPAs. Realizing that
many firms don’t want to fix something that’s "ain’t broke,” TCPM integrates
with other systems and can be customized to fit your firm’s needs. Templeton’s practical approach to
implementation allows you to take advantage of the capabilities you need when
you need them.
Has your firm committed to the alignment of people,
processes and technology? Are you
positioned the way you want to be to meet the management challenges of the
future? If so, congratulations! If not, it’s time to get started!
About the Authors
J. Gryskiewicz, CPA, CITP, is the Executive Vice President of Templeton &
Company, LLP, an accounting firm headquartered in South Florida. He also serves
as a senior executive with Templeton Solutions, a technology consulting
subsidiary of Templeton & Company. It is in this role that he manages
high-level IT projects and leverages his business and accounting background to
identify opportunities for successful, thoughtful integrations. If you have any questions or comments regarding the content of this article, you can contact Christopher at (561)
798-9988 or email@example.com
Ken McCall is a Senior Consultant at Boomer Consulting, Inc. Ken assists CPA firms of all sizes in strategic planning and technology planning. He has worked extensively in the area of training management for CPA firms. Ken is a lead facilitator and the program coordinator for The Boomer Technology Circles™, the industry’s premier peer networking group for technology management in accounting firms.
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Posted By Eric Benson,
Tuesday, October 18, 2011
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Information Technology (IT) is one area of any business
that is marked by these characteristics:
- Excellence is largely determined by a lack of
- The skill and knowledge to understand the
complexities are not understood by most people (it's a specialty field, after
- The most consistent trait is change, and this
trait can be controlled by seldom stopped
This article covers the idea that information technology
has never truly been about the technology itself. Computer science and computer engineering are
about the computer and software. IT professionals may be viewed in many
instances as manufacturing personnel (put this here, insert this, type this,
install this). However, most IT people are
really in the business of information service delivery. That's "endpoint delivery" in geek
terms. In business terms, it simply
means that the end result is a small step from face to face communication. IT people are just delivering information
through screens instead of direct communication - but it's still a service.
In order to make this change from IT as a product to IT
as a service, new terminology may be needed.
Since accounting is a service, let’s call our new model Information
Service Delivery (ISD for short). This
term suggests a shift from the computer (or screen, as we shift more to
multiple delivery platforms) to the point at which the screen and the person
Looking at technology as ... well, technology, tends to
reduce the quality of output to the end user (translate this as person). In other words, since you aren't providing a
service, you can get away with fixing the computer and call the problem
fixed. If you look at IT as ISD you also
have to qualify if the information was delivered properly after service is
performed, not just that the computer is working. This leap from technology to people can
radically improve the level of service, the understanding of your job and the
contribution to the people working in the firm.
Let’s revisit the three statements above and look at how shifting to a
service model can improve the quality of IT.
largely determined by a lack of issues
Many technology issues can be benchmarked on this
alone. Help desk ticketing solutions are
set up to let you resolve tickets when the issue is gone. They're even called issues or tickets in most
systems - because you're dealing with computers or other devices, right? Punch in your work and you are, like an
Contrast this with information service delivery. In this instance, a problem isn't fixed until
the information is resolved, not the issue.
So, an issue with a computer driver not working might not just stop at
the driver being updated. It will stop
when the displays are verified as working by the user. I think this, in many cases, is very
different from the way the IT person uses the displays. A follow up 2 days later may uncover that the
assumption for the fix wasn't quite correct.
Is the information flowing again?
This follow up can be automated, but is that good service? Selecting a subset of tickets to call on
might be a great way to see if you are truly providing what you think you are.
Other issues are not pure IT and shouldn't involve just
IT. A failed patch is an IT issue, let's
say. But when the patch has been rolled
back, what if you find out someone is having trouble using write up properly
during the patch removal (since you have to do it in person on the one machine
that didn't take)? That's an ISD issue and might not involve you directly - but
you can be accountable to make sure the issue gets resolved.
The skill and
knowledge to understand the complexities are not understood by most people
(it's a specialty field, after all)
As an IT professional, specialized knowledge is crucial
to the completion of projects. However,
communication is crucial to the successful delivery of these projects. On teams, this may not be the person who does
the work, but a successful information service delivery should include the
business and information delivery reasons why a project was completed
successfully, not just what was done.
Most often, the heavy lifting in IT is not communicated
because of the specialty knowledge needed to understand what happened. However, this often bleeds over into areas
that don't need specialty knowledge.
Thinking with a service delivery mindset may allow these areas to shine
through, which will in turn allow for improved communication.
In addition, that communication, since it is part of the
service, will need to be catered to the recipient. You wouldn't sell a highly technical watch
that needs some assembly to someone looking for a stopwatch, so why would you
want to communicate more than you need to in order to let someone know their
problem is resolved? There is a balance
between what was done and why that change was important to the person reading
or listening to the message.
consistent trait is change, and this trait can be controlled by seldom stopped
In the IT world, oftentimes the reaction to change is loudest
in gadget arenas as well as in the camps that are stalwarts for technology that
is tried and true. In the business
world, technology often is delivered too often for comfort or not frequently
enough to keep up with the times.
Think change using an information service delivery
mindset. Will this change help the
information being delivered? If not, it
might be a good candidate for reevaluation.
Sometimes it's a patch that will fix a lingering issue. Other times you may be switching out a system
without a strong information case - which in some instances is not evaluated
properly in the business case for an upgrade.
"This will give us a competitive advantage because
we'll be ahead of our competitors" is business language but says nothing
about the quality of information being delivered. Let's say the software upgrade mentioned here
fundamentally changes the three key screens of an application. Although it gives a competitive advantage,
the information will not flow as cleanly after the upgrade. Understanding this and acting on it will help
to improve IT from installer to enabler.
Consider information service delivery as a great way to
consider how IT provides value to a firm. An example would be "a change is
happening Saturday morning to improve the review process during x". This is much easier to digest than
"release 6.208 of x package will be installed on Saturday
morning". The first sentence states
how information delivery changes; the second merely states what is being
installed. The typical IT response is
what was done, not what value the change provides. This shift in communication is crucial to
helping your firm adjust to whatever change is coming.
Communication using an information service delivery model
may initially increase ticket resolution times.
In the long run, however, that communication improvement will help
everyone in the firm. Issues will be
completely fixed, reducing reemerging tasks.
Updates and system downtime will be assessed based on what is being
improved, not what dot release is coming online. And you and your firm can start to benchmark
the success of technology on metrics beyond uptime, service SLAs and other
metrics. Things like Net Promoter
scores, satisfaction indexes and quality feedback will start to drive an
improvement in service that may have an impact across all departments in the
The longer information as a service is taken into account
during IT projects, the more end users will become allies in transitions and
updates. Translation will become easier
between technology and business, and understanding of IT projects will
improve. Look for those in your team (or
your firm) who can view IT as information service delivery and use those people
to increase the quality of information you deliver. You will be part of the engine in your firm
that develops people because your service and communication will be concerned
with how they work, not what they use. Look at ways you can start improving service
to your firm. The change will take time,
but the change is worth the cost.
Posted By Boomer Consulting, Inc.,
Tuesday, October 11, 2011
| Comments (0)
The "Top 100 Most Influential People” list was released in
the September, 2011 issue of Accounting Today.
Looking through the list brought to light just how lucky we are at
Boomer Consulting, Inc. Not only do we
have a tremendous team of people with amazing talents that we get to work with
on a daily basis, but we also get to work with some of the best people in the
accounting profession. We are honored to
be associated with so many of the professionals that made the list. Boomer Consulting, Inc. would like to say
congratulations to everyone who made the list and recognize those individuals
with which we have the pleasure of working.
Our Clients & Partners
Our motto is "helping the best get better.” The number of our clients, partners, peers
and friends on this year’s list supports the notion that we are working with
the best people from the best organizations.
| ||Mark Albrecht|
CEO, XCM Solutions/Xpitax LLC
| ||August Aquila|
President & CEO, Aquila Global Advisors & Chantrey Capital Advisors, Inc.
| ||Andy Armanino|
CEO & Managing Partner, Armanino McKenna
| ||Erik Asgeirsson|
| ||Ron Baker|
Founder, VeriSage Institute
| ||Jon Baron|
President, Professional, Thomson Reuters Tax & Accounting
| ||Chandra Bhansali|
| ||Jim Bourke|
| ||David Cieslak|
Principal, Arxis Technology
| ||Gale Crosley|
| ||Chris Fredericksen|
Chairman, The 2020 Group
| ||Barry Friedman|
| ||Michelle Golden|
President, Golden Practices
| ||Jeff Gramlich|
President, CCH Small Firm Services
| ||Angie Grissom|
Executive VP & COO, The Rainmaker Consulting Group
| ||Tom Hood|
CEO & Director, MACPA
| ||Randy Johnston|
Executive V.P. & Partner, K2 Enterprises
| ||Rita Keller|
President, Keller Advisors
| ||Mark Koziel|
Vice President of Firm Services & Global Alliances, AICPA
| ||Allan Koltin|
CEO, Koltin Consulting Group
| ||Krista McMasters|
CEO, Clifton Gunderson
| ||Barry Melancon|
President & CEO, AICPA
| ||Jim Metzler|
V.P. of Small Firm Interests, AICPA
| ||Jeff Pawlow|
CEO & Managing Shareholder, The Growth Partnership; CEO, iShade
| ||Brian Peccarelli|
President, the Tax & Accounting Business of Thomson Reuters
| ||Rick Richardson|
Managing Partner, Richardson Media & Technologies
| ||Marc Rosenberg|
President, The Rosenberg Associates
| ||Rebecca Ryan|
Founder, Next Generation Consulting
| ||Mike Sabbatis|
President & CEO, CCH
| ||Gary Shamis|
Managing Director, SS&G Financial Services, Inc.
| ||Doug Sleeter|
Founder & President, The Sleeter Group, Inc.
| ||Jennifer Warawa|
Senior Director of Partner Programs, Sage North America
| ||Jill Ward|
Senior VP & GM, Accounting Professionals Division, Intuit Inc.
| ||Troy Waugh|
CEO, FiveStar 3
| ||Geni Whitehouse|
Countess of Communication, Even a Nerd Can be Heard and
Brotemarkle, Davis & Co.
| ||Jennifer Wilson|
Co-founder & Owner, ConvergenceCoaching
| ||Dave Wyle|
President & CEO, SurePrep
A company is defined by its leadership and the Boomer Consulting, Inc. team
is certainly fortunate to have the people we do steering the ship. We are honored to work with such great
leaders and proud of their recognition.
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Posted By L. Gary Boomer,
Tuesday, October 11, 2011
| Comments (2)
Accounting firms generally are not who you think of when you
yet many firms
excel at innovation and there is a pattern
to their success. Innovation is directly
linked to growth and not an epiphany like many think; but rather a process that
combines hindsight, vision and insight. The accounting profession is going through
significant changes and I am often told by firm leaders they just don’t have
the next generation of leaders in their firms.
In many cases there is validity to their statement and a better
understanding of innovation and how firms get into this situation can help
firms take the necessary steps to balance between "discovery” and "delivery”
skills. Discovery skills focus on new
opportunities, trends and creativity while delivery focuses on execution. You need both, but the tendency is to focus
Mature and typically
declining firms are dominated by people with excellent delivery skills, but
often lack the proper balance of discovery skills. Typically one or more firm founders were
entrepreneurial and tended to hire people for their delivery skills and not their
discovery skills. As a result, many
partners and managers don’t know how to think about discovery or give enough
value to the importance of innovation.
Accounting programs teach people delivery skills while most experiences
and on-the-job training also focuses on delivery and execution. In fact, many of the discovery skills are
viewed as nonproductive – more about that later. I believe innovation or lack thereof can
explain some of the frustration and what firms must do in order to develop the
next generation of innovative leaders.
Let’s look at two
different types of innovation and then how the most successful firms are
modernizing their practices to meet the needs and wants of their clients.
Accounting majors are taught the rules and regulations of the profession in
school and throughout their careers.
This is not a negative, but rather a fact as their perception is often
different than those with different training and aptitudes. Upon graduation, most accountants going into
public practice start in audit and/or tax.
This has been the traditional approach and is the primary reason most
innovation in firms is directional
innovation. Directional innovation
tends to improve a service in fairly predictable steps with a well-defined
dimension or goal. The majority of
innovation is directional and is accomplished through increasing levels of
expertise and specialization (delivery skills).
This is a low risk approach and one with which many CPAs are comfortable.
There is nothing wrong with directional
innovation, yet it is limiting due to the fact most of the participants are
looking at the problem from the same perspective.
Darwin John, former
CIO at the FBI, once said "if two of you have the same opinion, then we don’t
need one of you”. This may be a bit
extreme, but the point is that for real innovation (discovery) to occur it
requires multiple perspectives. This is
often called intersectional
innovation where multiple disciplines meet in the attempt to solve a problem or
improve a solution. From my experience
in the CPA profession, two areas within firms that have been responsible for
innovation over the past 20 years are firm administration and technology. Leaders in these areas have been attempting
to bring the silos together and improve performance through improved communications,
efficiency and effectiveness.
One step in entrepreneurial innovation, and the one leadings firms
are focusing on, is intersectional innovation or client centric innovation. It not only involves the client, but his multi-discipline
advisors. This can be difficult due to
egos and personalities, but the CPA is the most trusted business advisor and
should take his or her role seriously by acting as the quarterback when it
comes to innovation and improved client services. While many CPAs were trained to be rugged
individualist (focus on delivery) and solve the client’s problems on their own
or with a small team, that approach no longer meets the needs of a majority of
Today, clients are
looking for faster, better, cheaper and easier solutions forcing firms to be
innovative and sensitive to clients’ wants and needs. The capturing of transactions is becoming a
commodity with new technology and the ability to aggregate and integrate
information via cloud based solutions.
In the past tax return preparation has involved a significant amount of
time (fee) in aggregating data while technology has automated the calculation
and processing of the return. In other
words, the CPA is now caught in a situation where the services they are
offering are diminishing in value (commoditization). Part of this is due to technological
innovation and part is due to the pricing strategies used by the majority of
firms (hours times dollars-labor theory of value).
We are living in a connected world and someone is making those
connections. As the trusted business
advisor it should be you, the CPA, and your firm. The people making these connections tend to
be professionals who excelled in one field, but learned from others. This describes many CPAs and why they are the
most trusted business advisor. Formal
education increases the probability of attaining creative success to a point
and then actually reduces the odds. A
key to prolonged success throughout ones career is lifelong learning and
multiple experiences. It makes sense to
spend time on a variety of projects if you wish to develop fresh and
groundbreaking ideas. The value comes
from being able to spot trends and then integrate what you already know. This requires curiosity and an interest in a
variety of things. Innovators don’t
produce because they are successful, but they are successful because they
innovation while too much expertise can create barriers to innovation. Innovation requires a balance. More good ideas come when working in a group
than when working independently. The big
question becomes: what can and should firms do to promote innovation at the
intersection? As I said earlier in the
article, innovation occurs with vision, hindsight and insight. By looking at the current generation of great
firm leaders we see several characteristics that allowed them to be
innovative. Let’s looks at a list of the
most important discovery characteristics.
- The ability to connect and associate different perspectives
(clients, multiple advisors, trends, technology and etc.)
- The ability to question the status quo.
- The ability to hold
self and others accountable.
- The willingness to
participate in "safe haven” meetings with peer leaders.
- The ability to manage,
not avoid risk. The quantity of new
ideas improves the quality. Create the
environment to promote, not stifle innovation.
This list may not seem important to those who focus only on the delivery
side. Firms must be cautious not to
swing the pendulum too far toward the delivery or discovery skills. Both skills are required, important and
cannot be ignored. Success today
requires a team. The team should involve
younger members who are capable and expected to challenge the status quo or
strategy which has often been developed and implemented by senior leadership.
The fact is most
large organizations generally fail at disruptive innovation because top
management has been selected for their delivery skills. While it is the managing partner or CEOs role
to lead the innovation it is an extremely difficult assignment. Delivery executives do not like having the
strategy constantly challenged nor do they appreciate change. Does your firm reward and promote discovery
skills? If the answer is no, you have
your answer as to why you don’t have the innovative leaders for the future. Now is the time to identify and develop
leaders with the skills and willingness to focus on intersectional innovation. The future success of your firm depends upon
Here are five areas
where innovation will produce significant results. Granted they may not fit every firm, but most
firms will find three or more of these innovative ideas profitable.
- Billing and collection policies – use technology to improve cash
flow (ACH payments & Credit Cards).
This requires different thinking and change management. Too many firms are allowing clients to treat
them as interest free or "cheap” banks.
You can turn this around with improved engagement letters that specify
payment terms leveraging monthly bank drafts.
- Tax return
preparations processes – avoid loops and focus on one-way workflow. There are better ways to train than sending
work back to the preparer. You can use
technology to grade performance and report errors. Current workflow software has its roots with
outsourcing companies. If Federal
Express can track packages electronically, firms should be able to track work
in an efficient manner reducing cycle time.
- Client accounting in
the Cloud – firms can provide transactional as well as value added services
such as bill payment, payroll, controller, HR, IT and CFO related services on a
monthly basis. Private labeled software
that can be centrally updated and supported will allow firms to take back
control of accounting. It will also
allow your firm to become hardware agnostic.
It works the same on Mac as on a Windows based PC via a browser.
- Use portals to
aggregate client data for auditing and accounting as well as tax return
preparation. Avoid false starts and
wasted time. Portals provide security,
are inexpensive and clients like them.
Most of the resistance I see is within the firm.
- Conduct client focus
groups with marketing, tax and technology expertise present. This will provide innovation at the
intersection from multiple perspectives.
Listen to the client and provide the services he/she wants. Utilize firm leaders with discovery skills.
Innovation is part of
a firm’s culture and DNA. It requires
leadership and the willingness to manage risk.
Not every idea is a great idea, but the quantity of ideas determines
quality. Successful firms balance
discovery and delivery skills. Does your
firm have the discovery skills necessary to meet your clients’ demands in a
rapidly changing world? Provide your
people with the time and resources to innovate.
Based upon recent studies, most firms are less than 50 %
chargeable. What better use of the
non-chargeable time than innovation, training and new business development?