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.
Many young accountants working in public accounting have a strong desire to work their way up the ladder and become a partner someday.
There are a few problems with this scenario. First of all, “someday” is not nearly descriptive enough for young accountants just beginning their career.
Most non-partner accountants have no clue what they have to do to become a partner nor what they must do once they become a partner. Even worse, many current partners in accounting firm really don’t have a clear understanding of what is expected of them, even if they have been a partner for years.
You have heard it and read it many times, people entering the profession of public accounting want to know what their career path looks like, beginning on day one. They want to know what the next level, and all the levels after that, look like and how long does it take at each level.
I have observed that many firms have realized they need to document the career path process at their firm for their new hires. But, what about the current partner group?
I remember, several years ago, listening to Sam Allred of Upstream Academy describe a few things that CPA firm partners need to do:
Give up The Right to Remain Silent – When you become a partner, you must speak up at THE meeting (the partner meeting). It is not acceptable to nod your head and then go door-to-door after the meeting talking to the other partners. Not speaking up, in the proper forum, creates artificial harmony.
Keep an Open Mind – I relate this one to the 7 Habits, “seek first to understand and then be understood.”
You Give Up the Right to Make All Decisions – Sole-practitioners have this right. When you make the decision to be part of A FIRM, you give up that right.
Learn to Make the Proper Commitment – Saying/thinking, “I will stay out of the way” is not making commitment. It’s a case of “grudging compliance” vs. “spirited commitment.”
Willingness to Get Outside Your Comfort Zone – You cannot stand still. Becoming partner doesn’t mean you “made it” and now you can coast.
You Become a Leader for Change, Not an Anchor – You are helping row the boat, not sitting in the back and throwing out anchors when something doesn’t go your way.
Most CPA’s are pretty effective and accomplished in the strategic planning process. We invest the time and money in a retreat, we focus on the future, get lots of ideas on the table, agree on objectives and goals for the next year, commit to an action plan and sincerely want to move the firm forward. But what happens to all of the good intentions after we leave the retreat? How many of us really make significant changes; really accomplish the objectives and goals? Unfortunately, not too many.
While we may be effective in the planning process, most of us struggle (or fail altogether) with the implementation of the strategic plan. We just don’t seem to be able to get it done and next year’s action plan may wind up looking a lot like this year. The entire strategic planning process literally lives or dies on how well we implement.
We all know the drill. We go back to the office, the to-do list is still there, the emails are piled up, the phone rings and we’re back to doing what we do – serving clients. That’s what we enjoy and we tell ourselves that we’ll get around to the “retreat stuff” when things slow down a little bit. Subconsciously, we’re also thinking that these strategic initiatives involve change and we all know that change is uncomfortable.
There are several common realities and paradigms in firms, including those in the preceding paragraph, that stand in the way of successfully implementing our strategy. They exist in most firms and our implementation plan should be designed to overcome them. Although these are not all-inclusive, if you address them you will significantly improve your odds for success. They include:
- “There are just too many things that we are working on to get it all done.” A common mistake is to come out of a retreat with a long laundry list of action items. We are doomed to fail if there are more than three or four strategic objectives that we are committing to. Remember the key word is “strategic” and that means they are significant to the firm.
- We all know that each of the action items need to be owned by someone and that there needs to be a completion date. Make sure that the champion is an individual and not a group or committee or more than one person. It is much more difficult if not impossible to hold a group accountable. And, make sure that the due dates are reasonable (not overly optimistic).
- Does the champion who owns an action item or strategy have the time to accomplish it, especially if it is significant? Or, do we just expect that person to get it done on top of their existing client and firm responsibilities? If this is a strategic priority, we must enable them to be successful and that means creating the time to accomplish it.
- Don’t be a lone ranger. The champion needs to get other people involved. If it is a sizeable initiative and important to the firm, build a task force to accomplish it. Make sure you bring some of your young people into the process. The millennials want to be “a part of it” in your firm.
- Is the action item a significant part of the individual partner’s goals for the year? Further, make sure that the individual goals of the entire partner group are aligned with the firm’s goals and strategies for the year. If you don’t set partner goals, that process should be an action item out of your next retreat!
- Is it nice if we accomplish the action items or is it mission critical? Does it have any influence on a partner’s compensation whether they achieve it or not? Many firms set the expectation and may even include it in a partner’s goals but the compensation system is not aligned. Accountability should include compensation.
- Keep the strategic initiatives from the retreat alive and “top of mind”. Make sure that a status report is a lead agenda topic for every partner meeting. Share the strategic initiatives with the team right after the retreat. You’ll be more likely to get something done if others are watching.
- Someone should own the overall implementation process and that is your managing partner. He or she should be the person driving the process and holding the rest of the partner group accountable to achieving the action plan. That doesn’t mean that the managing partner and/or firm administrator should wind up with the all of the action items on their plates.
- If you utilize an outside facilitator for your retreat, ask that they build into the process some follow up with the firm after the retreat. It can be as little as a couple of phone calls to check in and see how you are doing. We are all better if there is accountability. Your managing partner can provide that to the partner group but the facilitator can fill a similar role for your managing partner.
Make sure that your investment in strategic planning pays dividends for the firm. Your post retreat implementation plan may be the missing piece and the key to success. Don’t leave it to chance and don’t leave the retreat without it.
Inside every accounting firm there is a naysayer. It’s the person who denies, refuses, opposes, or is skeptical or cynical about almost everything. It is the person who says, “we can’t do that.” Maybe your firm has more than one of these types. They always seem to see the glass half empty.
In progressive, well-managed firms, firms with strong, rich cultures, you will find people having conversations about the firm that are positive. Conversations that move the firm forward.
In these firms with positive cultures, when someone whines and says, “Nothing good is happening here,” someone else will often say, “Oh, what about the additional holiday they added last year?” or “Didn’t you just get assigned to one of the firm’s top five clients?” Negativity is diplomatically discouraged. And, if something truly negative is happening, management deals with it immediately.
Sometimes there are negative conversations and even less-than-tasteful jokes about some of the firm’s clients. Of course, you also discourage these kinds of comments. However, be aware and be realistic. Do some of your clients need to go elsewhere?
In firms that get it, you will find people who are keeping the vision alive. The vision lives in the conversations inside the firm. These positive conversations about the firm and the firm’s clients will help the firm grow and prosper.
Promote your positive culture by hosting a lunch & learn and ask your team members to identify positive things about your firm. Discuss them and then enlist your team in talking more about the positives on a daily basis.
Also, do the same exercise focusing on negatives at another lunch and learn session. Once the negatives are aired, select one or two and promise the team that management will address them.
One of the most enlightening activities I experience as I facilitate a partner retreat, assist a firm with strategic planning or with merger conversations is dinner the night before the meeting.
Almost every time, the partner group is relaxed and looking forward to the task ahead. They really seem to enjoy having dinner with each other, rehashing old stories about their early years, about the time they made a big mistake, the time three of them got lost driving to a client location, and so on.
They laugh with each other and tease each other. They tell me so many good things about their firm and their careers. Often, during this casual, conversational dinner they bring some great ideas to the surface. What if we tried this? What if we did that?
Some of us consultants lovingly call this event “the 3-hour dinner” because it goes on for a really long time (and we have been traveling and are tired). That being said, I would NOT change it – it is quality time for the group and for the facilitator.
I highly recommend that partner groups schedule group dinners every quarter or at least twice a year. Just the partners – no spouses, no managers – maybe include partners-in-training. Don’t have an agenda – just relax, enjoy dinner (maybe a little wine) and some great conversations might occur. This would be even more important if you have more than one office location.