3 Disconnects That Can Stall Your Firm

3 Disconnects That Can Stall Your Firm

The importance of connections cannot be overstated. Anyone who leads or manages a business (or any organization for that matter) knows the importance of connections. Often, connections are defined in terms of customers, revenue and success. In business, making connections with clients and potential clients is everything.

Without an outlet for your services, there is no business. The same goes for not-for-profit organizations. Connections to donors and community leaders, who are supportive of your cause, allow your organization to have the resources to carry out your mission. And, let’s not forget about sports and other recreational organizations. Making connections with your fans and audience is everything – you must put a winning and entertaining team on the field or stage to “connect” and generate buzz and excitement in your communities.

However, beyond the obvious customer-type connections that organizations must be continuously fostering and growing, there are other less obvious (or ignored) connections that must be developed and strengthened to become the organization that potential customers and supporters want to associate with.

An industry group recently asked me for my thoughts on the following question: “What do you think are some of the biggest issues facing the profession today?” The responses began to flow naturally, and I realized the theme centered on the idea of “disconnections” in many areas of our practices. These disconnects fall into three categories, which I further explain:

  • Technology
  • Training and Development
  • Client Value

The Disconnect in Technology

One of the main disconnects I continue to observe in firms of all shapes and sizes is the multiple disconnects in technology. It may come as a surprise that I list technology in the disconnect category because so much emphasis and money have been devoted to expanding and growing technology within our profession over the last few years. The proliferation of vendors and products speaks to this scenario. However, I think the disconnect now may be larger than at any other point I’ve observed over the past five years in the profession.

For starters, the gap between the technology savvy and the technology “un-savvy” in firms doesn’t seem to be shrinking. There are numerous levels and groups of individuals within firms who skirt the process and do not fully adopt the new technology. Many times, these individuals are operating outside the process – adding non-value added steps and processes for others who have to mend the process to deal with the outliers, and who are barely able to keep up as it is. Often, with just a little bit of training, time savings could be realized if these individuals adopted the process and technology that the majority of the firm is comfortable using.

Second, firms are not leveraging the full scope of the technologies they have (and have paid for) to their benefit. I often find that within firms, there are multiple individuals who understand and use unique features that the majority of the firm either doesn’t know about, or hasn’t taken the time to learn. When we begin taking an inventory of this knowledge and ability, we quickly see a lot of opportunities for training and time savings by adopting these internal technology “best practices” firm-wide.

The Disconnect in Training and Development

We’ve all heard the cliché, “Your people are your greatest asset.” Unfortunately, many firms are failing in the general maintenance, care and attention given to these important assets. I recently wrote about how, generally speaking, we are one of the leading professions in keeping close track of our CPE. Often, firm-wide programs are utilized to track and manage CPE. But, I think we’re falling considerably short in measuring how productive that training is.

It never fails. Every firm I go to, I hear, at all levels below partner, the clamoring for more effective and hands-on technical and leadership development training. But, there are also huge disconnects. The staff is begging for more hands-on training in the tax and audit programs, the understanding standards and tax principles and more. They want to grow.

But, managers and partners say they are getting sufficient training. How can that be? At the manager level, they are asking for more project management and leadership training. But, often, they are “promoted” to supervisor and manager based on years of time put in, instead of demonstrated competence in project management and staff development. They are put in this position to fail.

As these individuals struggle to keep up and manage, they aren’t spending enough time training and developing the next group of leaders, and it becomes a vicious cycle. Firms end up producing a bunch of what I call “zombies,” who must always be told what to do instead of being problem solvers. How can that be?

The Disconnect in Client Value

A major Lean Six Sigma principle is understanding “The Voice of the Customer (Client).”  Therefore, the disconnect I see is in firms where the partners or managers, who are in charge of the client engagement and relationship, don’t understand what their clients value. I know how damaging this can be.

Clients want value for the high fees they are paying. Even in this new economic reality of downward fee pressure, clients want and expect more value. Clients expect their work to be handled professionally and completed on time. Clients expect to receive more strategic advice and guidance than what we’re currently providing. They believe any CPA can perform their basic compliance needs. They are paying your firm to be their trusted advisor – to go beyond the basic compliance and help them navigate their business and personal situations.

As firms continue to struggle with their processes and workload, the proactive guidance time is being squeezed out. This is not a good trend. Clients are beginning to feel they are paying a premium fee for basic compliance services and nothing else – a recipe for future client retention problems.

How Does Your Firm Stack Up with these Common Disconnects?

I believe firms that continue to underestimate the importance of improving and reducing these disconnects are going to find themselves continually playing from behind in our new economic reality. I always get back to the fundamental principle that successful firms master better than their peers – the principle of excellent client service. When you have these disconnects, not only is it costing your firm time, but it’s also costing your firm current and future opportunities of providing excellent client service.

Do you want to improve your firm? Tackle the disconnects and agree to the following:

  • We must continue to reduce the number of people in our firms who refuse to get on board with new technology. Age is not an excuse (I know many technology-savvy senior partners and managing partners). Client service is not an excuse. If these individuals want to be included in the process of work for the client, they must follow the process.
  • We must find ways to continue to leverage the capabilities of our current technologies. This means working together in cross-functional teams to improve our knowledge and processes.
  • We must understand that the best learning is done one-on-one, collaboratively in our offices with our team. To progress and move up, you must train your replacements. We can’t slack on staff training and just “throw them to the wolves” with one day of tax training.
  • We must understand that a promotion to supervisor or manager means these individuals need to be demonstrating the abilities expected of them – the ability to manage clients, projects, and staff and develop their people.
  • We must understand that client value goes beyond how many “charge hours” we have into a job. A client doesn’t care about the effort. They care about results.
  • We must find ways to provide higher value to clients, in order to keep our fees high and our competitors from poaching clients. Being a trusted advisor means doing so much more than just basic tax, audit or accounting work. It means helping the client navigate through their personal and business decision-making processes.

With more focus, measurements and rewards on these activities, you’ll see a greater transformation in your firm and your people. You’ll develop and build upon connections, instead of disconnects. Challenge the status quo and get results.