The traditional way a CPA firm finds and uses a management consultant is to ask around and find out the names of consultants that other firms are using or have used. Or, you might identify someone you have heard speak at a management conference then hire them to facilitate your partner retreat.
The firm has budgeted a certain amount for the retreat facilitation and after the retreat, the consultant moves on to other engagements and the firm often does not want to spend the money to have them do follow-up work or assist with implementation and accountability
Find a consultant that you think fits your firm, based on size, service lines, people needs, partner problems, etc. You find these people by hearing them speak but also by assessing them in relation to their writings, use of social media, and ability to keep pace with current trends in business.
Initially, they will facilitate your retreat or conduct a planning day or two with your partners or management leaders. Then they attend your monthly partner meetings or executive committee meetings (60 to 90 minutes per month via Skype or another virtual resource) to continually contribute and to hold you accountable. The firm budgets an amount for the 2-day planning session and another amount for the 12-month on-going involvement.
Result: You have a much better shot at actually getting things done, at moving your firm ahead, at recruiting and retaining top talent and developing a culture within your firm of continual change and improvement. That’s the culture the new workforce wants to experience.
Who does the hiring at your firm? In CPA firms, at least in those under fifty people, the recruiting and hiring activities are usually assigned to one particular partner.
Other partners and staff might be involved in various activities and interviews but usually one partner takes the lead. Sometimes, it is an experienced manager who leads these efforts.
I have observed that in many firms, this person has been playing a key role in recruiting for many years. They personally visit the college campus and conduct the formal interviews during the fall recruiting season. Sometimes they draft a manager or senior, who is an alumnus of that institution to accompany them and share the interviewing duties.
This leader also attends campus job fairs and “meet the firms” events. They may also be visible at accounting fraternity events and meetings. They work closely with the firm administrator in organizing many activities that are part of the recruiting efforts. Finally, they probably make the key decision in who receives an offer and who does not.
I want to suggest that you consider replacing this individual with another key person at the firm. I also think it is a good practice to only allow this recruiting leader to be in the role for no more than five years.
Why? Because people tend to hire people just like them. Of course, they do this without even realizing it. Studies have shown us that employers seek out candidates who are not only competent but also culturally similar to themselves.
You need a variety of skill-sets and personalities to build a successful firm. The most successful firms have programs in place to promote diversity within their firm. So, when it comes to a leader for your recruiting efforts – mix it up every so often.
Have you wondered how long the partnership, ownership model for public accounting firms will continue? I have. If you are at all in tune with the changing workforce, this topic must have crossed your mind.
Baby Boomer partners came of age in a different environment. If they worked long and hard they had a good chance of becoming a partner. Most did not even have to prove themselves as significant rainmakers. It was mostly about technical expertise and work ethic. You just had to prove that you were willing to work 60, 70 or more hours per week and that your work was accurate.
As business development became more and more important, many firms found that they had too many non-business getting partners and the sales aspect of the firm rested on the shoulders of a few, sometimes just one partner.
The current public accounting workforce desires a more balanced lifestyle. They question the process of becoming a partner and wonder if it is all too political. Is it all about who you know and not what you know?
All of this came to mind because of a very interesting post by Caleb Newquist on Going Concern titled, To Partner or Not to Partner, That is the Senior Manager’s Question.
Newquist explores the role of the CPA Senior Manager. Some senior managers share the fact they wonder if they really want to be a partner in a public accounting firm. They also see through the ploy of the non-equity partner, or Director, role as a mere parking lot for people who will never be a partner.
Read the article and see if any of it applies to your own firm.
As the firm leader, you have many very important responsibilities. Sometimes you do what is easiest and sometimes you do what you like the best.
For example, you really need to focus on guiding the firm to a better workflow process but, a client calls with an interesting project and you take it on yourself rather than delegating. Putting client work first is an easy-out for many partners and especially managing partners. It’s something you know, understand and enjoy.
Almost daily, you feel pulled in too many directions and it’s not just your office life, it includes your home life, too. You are faced with:
- Exercising for personal health
- Home responsibilities, like yard work
- Hobbies, because you enjoy them (like golf)
- Taking on the duties of assistant coach for your son’s soccer team
- Giving attention to those scores of emails in your inbox
- Returning phone calls from clients
- Filling out that performance review questionnaire on a staff person
- Scheduling mentoring meetings
- Conducting goal sessions with the other partners
- Meeting with the firm administrator to handle operational questions
- Meeting with the technology director about security issues
- Review work on client engagements
- Checking firm production for the previous day (or week)
- This list could go on and on……
First of all, you are not alone. Most of your partners and staff feel the same way!
Just remember, you don’t have to do everything yourself. Help is there, if you ask. Delegate as much as possible to your firm administrator (practice manager). Allow the staff to take on more difficult client assignments. It will help them stretch and grow.
There is an old saying, doing ten things half way is not the same as doing two things as best as you can. Make thoughtful choices and never forget, it is okay to simply say, “No”.
I have occasionally heard the phrase, “I Led Three Lives.” I never realized where it originated so I Googled it. It was a TV series that aired during the 1950s about a spy.
The managing partner of a CPA firm lives three lives. Two lives in their professional life and, of course, their personal life.
Their two professional lives are comprised of the outside-the-firm life and the inside-the-firm life.
The managing partner is the face and voice of the firm. The MP represents the firm in the business community and in the civic/charitable community. The MP speaks on behalf of the firm in media relations and as part of the Chamber of Commerce or other business related organizations. The MP often serves on several outside Boards of Directors and may even be active, on behalf of the firm, on social media.
Of course, all partners in the firm should also be leading two lives at the firm – inside and outside, just like the MP/CEO, but maybe not quite as high-profile.
I often observe that while some client service partners fill a prominent role inside the firm, they rarely venture outside to be visible in the business community or on social media. Yes, they do interact with clients but rarely generate new business themselves.
It is a partner’s responsibility to generate new business. If this is something you are not comfortable with, make it a goal for 2018 to be more involved in the business community. Take it a step at a time. Maybe you can begin by accompanying a rainmaker to an event or join with your other partners and their spouses to support a local charitable event or banquet.
Don’t forget that third life – your personal life with friends and family. Too many partners work too many hours. I have often heard a partner confess, “Work is my life.” When partners show workaholic tendencies it discourages younger accountants from ever wanting to be a partner in your firm and often they leave to join a competitor.
CPA firms are committed to training. You (firm owners) have invested significant dollars in the training of your new hires, especially new college graduates. You send them to different levels of tax and audit training during their first few years in public accounting. They become very skilled at working through a client engagement.
Something that is often ignored in those first few years is just as important and, in later years, even more important – the skills that comprise emotional intelligence.
Daniel Goleman, an American psychologist, helped popularize emotional intelligence (EQ). It is comprised of five core skills:
- Social Skills
Emotional intelligence is simply the ability to manage your own emotions and those of the people you manage. Many experienced CPAs have missed out on this type of training.
If you partners are not bringing in new business nor very good at developing younger accountants, it’s time for some investment in EQ training.
A leader who possesses a high level of EQ has complete trust of her staff, listens to her team, is easy to talk to, and always makes careful, informed decisions.
Throughout my managing partner career, I read a lot of books and articles by David Maister. I also heard him speak many times over the years. His comments, almost always, hit home with me.
Until his retirement in 2009, David Maister was widely acknowledged as one of the world’s leading authorities on the management of professional service firms (such as law, accounting, and consulting firms, and companies providing engineering, advertising and executive search services).
For three decades, he advised the top firms in these professions, around the world, covering all strategic and managerial issues.
He often talked about a topic that has stayed with me. I have also been involved in this issue many times during my consulting and retreat facilitation activities:
Why do accountants in public accounting continue to work with clients they dislike…. even dread?
Maister learned from a survey of professionals around the world, that they enjoy their work 20 to 30 percent of the time, and can tolerate the rest. The report also found that professionals like the clients they work for and find the clients’ sector interesting about 30 to 40 percent of the time. Again, the rest is acceptable.
Maister’s (and my) question for you is: If you don’t love what you do or those you do it for, why would you want to go out and get more of it?
Some CPAs will honestly tell you that they continue to put up with clients they do not like because those clients are willing to pay. So, they are doing it for the money.
If you didn’t have to spend so much time on these unlikeable clients and doing work you hate, you would have much more time to work with likeable clients doing work that is challenging and interesting. It would be fun!
Isn’t it time, as a partner group, to commit to reviewing the firm’s complete client list and out-place about 20% of your clients? Then, do it again next year?
In the CPA profession, we talk a lot about delegation. Usually, my conversation with partners is about how to get better at delegating. So many CPAs are very poor delegators.
Today, I want to address the multitudes of you (staff, managers, admin) who are receiving delegation. I recently read a very helpful article provided by MindTools. One of The Five Ways to Deal With Delegation is No. 2 – Check The Facts.
Check The Facts:
Give yourself the best chance of success by gathering from your manager as much information about the task as you can. He may lead the delegation process, but you’ll be able to balance your and your boss’s needs by asking him questions such as:
- What exactly is the task? What’s its purpose and value?
- Why are you asking me and not another colleague? Do I have the most relevant skills, or the most time available? Do I need training or resources?
- When does it need to be done by? Is the deadline realistic or flexible?
- Who else has an interest in, or influence over, the task? Who do I need to involve or inform? (Influence maps and stakeholder analysis can be useful tools here.)
- How would you like to manage and monitor this task? How often, or at what stages, and in what format, would you like me to update you about my progress? Also, how much freedom to make decisions do I have?
- Which of my existing work should I “park” to free up the time and resources that I need to complete this new task?
The answers will give both you and your manager a clearer understanding of what’s expected. And you’ll know whether you can accept the request outright or if you need to agree a compromise.
Those of you delegating, be sure you can supply the answers to all of these questions. Read the entire article to learn about No. 1, 3, 4 and 5.
The informative article also gives you tips on how to say “No” when necessary.
If you are struggling with staff retention and other human resources issues, maybe it is time to be more proactive and listen to your own people. Many successful and progressive CPA firm have established a Staff Advisory Board or a Team Advisory Council.
The advisory board is formed to assist the CEO or Managing Partner in leading the firm to future success. It can be defined as a group of employees who meet on a consistent basis to provide support and constructive feedback to firm leadership.
A common structure is to have team members serve for a specified term. In some firms, they are elected by the entire staff and in other firms they are appointed because of their mature perspective and past performance. The members should represent all levels within the firm and the size of the group should be kept relatively small.
In some firms, it has become a very sought-after and prestigious role. The advantage for the members is that they have the opportunity to work directly with the firm CEO on important topics for the firm. They get to know the leader on a more personal basis and have the opportunity to better understand firm operations.
A staff advisory board, comprised of engaged and knowledgeable members can be a real asset when deciding upon HR issues or possible changes to employee benefits.
It is important for the managing partner to meet with the group on a regular basis. Once a month is a common practice but it should not be any less than quarterly. Most importantly, the managing partner and other firm leaders must be willing to listen to the feedback and take action based upon some of the feedback that is received.
Some larger firms even have sub-committees under the advisory board banner. One to focus on salary/benefits, one for morale and maybe one for performance feedback.
As Jim Rohn once said, “We generally change ourselves for one of two reasons: inspiration or desperation.”
As I work with CPA firms around the country, I am finding that the BIG topic of change has been ignored, delayed or swept under the rug. It seems many partner groups are thinking, “If we procrastinate about these ideas and initiatives, maybe we won’t have to change after all.” Not true. In fact, it is a much bigger topic than working on “the firm” and making it better.
The bigger issue is, if you want your firm to change, you have to change yourself. If you want your firm to become better – a top-notch, well-known, progressive firm, then you, as an individual, have to change. You have to become better, a top-notch, well-known, progressive professional. Keeping up-to-date isn’t good enough, you must commit to personal, stretch goals.
If you are the managing partner, you should hold all of your partners accountable for reading inspirational self-development books and working harder on their own self-development goals.
Among CPA firm partners, we often belabor the topic of partner compensation. What I would like partners to ask themselves is, “What am I becoming?” and not, “What am I getting?”
To prepare your firm for the future, you need to focus on people, technology and culture. Better people, technology and culture will not ever happen if firm leaders are not preparing themselves for the future.
If you wait too long, it will no longer be an issue of finding the inspiration to change, it will become an issue of desperation because your competition and the business world have changed and moved on without you.