• Arianna Campbell, Shareholder

3 Issues Impacting Firms (And How Lean Can Help You Solve Them)

While Lean Six Sigma is sometimes misunderstood as only being about efficiency, it is proven framework for change that is centered on client value and continuous improvement. The Boomer Lean Circle is a community of the accounting profession’s top Lean leaders and champions within CPA firms who are committed to applying the Lean Six Sigma mindset, skillset and toolset to navigate the ever-changing dynamics of the profession. This group of 25 firms ranging in size from 23 to 5,000 FTE and three solution providers met in May and used a problem-solving framework to identify solutions for the top three issues impacting their organizations: the transformation roadmap that is needed for the transition from compliance to advisory, the skillset shift that is needed to make this transition and the impacts of the gig economy.

Transformation roadmap

The group agreed that the transition from compliance to advisory is already happening, but there is a need to move beyond just talking about the transition to taking actionable steps. However, some obstacles include lack of a clear vision, buy-in and accountability. Recommendations for moving forward included starting with leadership education and buy-in. For some in the firm, there may be a need to build consensus on the need for change. The best approach is to discuss the opportunities and benefits to help understand the firm wide implications. In addition, work to provide answers to the two Why questions: “Why do we need to change?” and “Why will this be better than what we were doing before?”

Technology is the foundation of the transition as automation continues to impact the profession and provide solutions that create capacity. Therefore, it is necessary to allocate more time and resources to research new and emerging technologies. Processes should be evaluated regularly and should be aligned with new technology implementations. The group suggested acknowledgement or rewards for learning new technologies and for innovative ideas that lead to increased firm performance. Measurements and KPIs are currently a limitation for tracking progress, however, technology can provide additional metrics and visibility through reporting and dashboards. As firms move toward more consulting work, we recommend using workflow programs to track these projects and prioritize deliverables. This will in turn help to provide metrics beyond the charge hour.

As firms are making the transition, it is key to “perform while you transform.” Reallocate resources to create the space to focus on tomorrow, while also ensuring the success of today. In addition, employee skillsets should be evaluated to determine what gaps exist for aligning talent with the future firm.

Skillset shift

As CPA firms move toward more consultative work, the skillset required for existing and new staff are shifting. The group agreed there is an abundance of technical skills in the profession, but we need more emphasis on developing core success skills as technology continues to automate compliance-related tasks. These skills include managing people, developing relationships, critical thinking, consultative conversations, productive conflict and business development. Reevaluate hiring practices to ensure that firms are pursuing people with the skills needed for the future. Update training curriculum and delivery methods to equip people for success. Encourage current employees with these skillsets to use their talents in their roles and also be involved in consultative opportunities to help develop their skills. Utilize internal consulting teams more to help leverage their models and skills into the compliance areas of the firm. The belief that technical skills need to be mastered before client management is status quo thinking that must be challenged.

The increasing value of analytic and modeling skills is creating more opportunity for team members to transition into data analytics roles. Firms can leverage technology to bridge analytics skills into current work to provide additional insight to clients. This should begin with identifying people with a passion in this area, keeping in mind that this may also include new graduates with degrees in computer science, data analytics, finance, etc. Analytical skills training should be provided using internal or external resources and data analytics champions should be involved in developing and dashboard and insights for clients.

Other recommendations for the skillset shift included rewarding the identification of projects and cross selling, rewarding innovation, invest in training programs to cater to different generations and having a young staff person attend every client meeting to transfer wisdom in real time.

Impact of the gig economy

Google dictionary defines the gig economy as “a labor market characterized by the prevalence of short-term contracts or freelance work as opposed to permanent jobs.” This is already impacting the profession and provides additional resources when leveraged effectively. The group shared a good visual of a light bulb inside the traditional pyramid structure. At the bottom of the illustration is where firms will need less lower level staff, as this work is increasingly done by gig workers and technology. Seasonal and specialty needs will be efficiently fulfilled and more flexible workforce options will be available. This will significantly reduce costs for firms as they carry less overhead. It will also allow more people within the firm to elevate their roles into knowledge delivery, which adds more value to the firm and the clients.

The group also shared their questions and concerns around security, quality and managing the work and the workers. There was agreement that more education is needed and this is a trend that cannot be ignored. Businesses should plan ahead to take advantage of the resources that the gig economy provides. Recommendations included: getting management buy-in, establishing new systems and processes to enable these contractors, developing contractor policies around security, implementing an evaluation system to rate the quality of work and training full time staff on working with contractors and how to best manage the relationships.

The Boomer Lean Circle group will meet again in August at the BTC Summit in Kansas City to share updates on their progress and discuss how to continuously improve their firms and the profession.

As a consultant for Boomer Consulting, Inc., Arianna Campbell helps accounting firms challenge the status quo by leading process improvement initiatives that result in increased profitability and client satisfaction. She also facilitates the development and cultivation of future firm leaders in The P3 Leadership Academy™ Academy. Internally, she blends concepts from Lean Six Sigma and leadership development to drive innovation and continuous improvement within the company. Arianna also enjoys the opportunity to share knowledge through regular contributions to the Boomer Bulletin and other industry-wide publications, as well as public speaking at industry conferences.