Growing a future ready CPA firm
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We hear a lot about growing business which tend to lead to thoughts of adding services to existing clients, increasing rates, finding new clients, etc. Now factor in the impact of templosion, what is your strategy for a relevant and growing practice? When we think of growth and being future ready you should pause to reevaluate your growth strategies. In this webcast we will cover tactics to consider when growing a future ready CPA firm through a focus on innovation, being responsive to technology change, involving various team members and more.
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Growing a future ready CPA firm
- 1. WELCOMETO GROWINGAFUTUREREADYFIRM We will start at 2pm ET
- 2. GROWINGAFUTUREREADYFIRM Amy Radin, digital and innovation advisor Carolyn Hall, CPA, director of FWRD Services, Wiss & Company Samantha Mansfield, director of corporate communications, CPA.com
- 3. Samantha Mansfield Director Corporate Communications, CPA.com • 15+ years of experience in tax and accounting technology industry • Consultant on workflow and web implementations • Designed and built educational events for practice development • 2015 CPA Practice Advisor “40 Under 40”
- 4. Amy J. Radin Digital & Innovation Operating Executive & Advisor • Digital, marketing, innovation and client experience operating executive • Led digital transformation initiatives at Citi, American Express, E*TRADE, AXA • Member of New York Angels • Advisory Board member, early stage startups Recognized by “Business Week” as a top corporate innovator • Graduate of The Wharton School (MBA) and Wesleyan University
- 5. Carolyn Hall, CPA Director of FWRD Services, Wiss & Company, LLP • 20+ years of both public and private accounting experience • Been instrumental in the development of Wiss’ outsourced accounting practice in the cloud (FWRD) • Active member of industry advisory boards • Member of the Wiss Women’s Leadership Forum • BS – Accounting from Montclair State University, MBA in Finance from Iona College
- 6. Today’s Discussion Impact of Templosion A Firm in Review “How-to’s” for Making Innovation Real Questions & Resources 6
- 7. “INNOVATIONDISTINGUISHESBETWEENALEADERAND AFOLLOWER.” - Steve Jobs, entrepreneur 7
- 8. Templosion “the implosion of everything into compressed time” Tem·plo·sion [Tem-sploh-zhuhn] Noun
- 9. “It’s a Templosion” “I like Tom Hood’s VUCA term to define the paradox. ‘Rapid, short-term change and long-term leadership ideas and goals simply don’t mesh well.’” - Hubert Glover, Author: The Making of the Twenty-First-Century Leader “It’s a VUCA world – Volatile, Uncertain, Complex, and Ambiguous … the answer to rapid changes and hyper-competition is a bold vision and core value’s; maintaining values that don’t change while constantly re-inventing the shorter term strategy.” - Tom Hood, CPA.CITP, President & CEO, Maryland CPA Society
- 10. “It's tough to make predictions, especially about the future.” A Note On Predictions - Yogi Berra
- 11. Our Near Term View is Always Unclear “Inside the Tornado” “Tipping Point” “Crossing the Chasm”
- 12. Innovation is any type of differentiation in your practice that causes clients to prefer to do business with you, and as a result, increases your practice’s revenue and profitability. 12
- 13. 13The 10 Types of Innovation
- 14. 14
- 15. Firm in Review
- 16. Getting Started 1. Firm vision and support 2. A champion dedicated to the development of the new business 3. A team willing to take risk and learn how to do things differently “Don’t be concerned that things appear to be falling apart: this has to happen in order for something new and wonderful to emerge.” 16
- 17. Challenges Juggling of current work load/clients and the “new business” Developing the levels of service from both a tactical standpoint and for marketing purposes Evaluating the clients’ needs Pricing Keeping the pipeline full 17
- 20. TODAY 20
- 21. Steps to Success Leaders spent time on strategy not just operations o “Leadership excellence for executives and partners is all about combining strategy with operations… most fail to understand the difference.” – Rewarding Innovation in Strategy, by Greg Weismantel Open to change from status quo Embraced a level of failure o “I have not failed. I’ve just found 10,000 ways that won’t work” – Thomas Edison Stayed focused on the vision and mission 21
- 23. What Early Adopters are Saying You share some common challenges that are addressable o Time o Talent o Metrics And you rate technology low as an obstacle 23
- 24. What Early Adopters are Saying 24 0% 10% 20% 30% 40% 50% 60% 70% Listen to each other Are continuous learners Share client feedback Cultural Attributes of Successful Innovation Cultural Attributes of Successful Innovation 0% 10% 20% 30% 40% Strongly agree firm will take risks Strongly agree firm will try new ideas View an Upside to building an innovation muscle View an Upside to building an innovation muscle
- 25. Speed creates competitive advantage … time is your most important innovation resource 25 Leader as sponsor not do-er – strategist not operator Governance, communications, recognition Ruthless prioritization Delegation and Empowerment What it comes down to: Great people in a great culture will bring their best selves to work and make huge discretionary effort to help you succeed
- 26. It’s a hot market for people who can innovate 26 … it’s a mindset more than a skillset or demographic
- 27. The right metrics stimulate innovation and sidestep unintended consequences Metrics essential: caution to the wind is not a strategy Revenue growth per client, increased penetration of target client list, Increase in new clients, increased client retention Client satisfaction survey improvements Margin –be careful about test vs. scale calculations Be reasonable - “what would you have to believe” business case basis Validate the business model first, if it works, the profits will come What is your definition of success based on your firm’s strategy? 27
- 28. Questions?
- 29. Growing a Future Ready Firm Consider the concept of templosion Don’t plan purely operationally, think strategically Build your innovation muscle Don’t go it alone 29
- 30. Resources CPA of the Future Study o www.CPA.com/Future-Ready-CPA Templosion 10 Part series from AICPA o http://www.smartbrief.com/s/2013/08/templosions-impact-competition Journal of Accountancy – “Expanding Your App-titude” column Accounting Today – “App of the Week” column “Accounting Services - Harnessing the Power of the Cloud” o Dr. Geoffrey Moore o http://www.cpa.com/whitepapers/accounting-services-harness-power-cloud 30
Editor's Notes
- Samantha (description: We hear a lot about growing business which tend to lead to thoughts of adding services to existing clients, increasing rates, finding new clients, etc. Now factor in the impact of templosion, what is your strategy for a relevant and growing practice? When we think of growth and being future ready you should pause to reevaluate your growth strategies. In this webcast we will cover tactics to consider when growing a future ready CPA firm through a focus on innovation, being responsive to technology change, involving various team members and more.)
- samantha
- Amy Happy to be here with you today. Career in large corporate consumer financial service, last 15 years leading major digital transformation efforts. Decided in 2014 to shift towards advisory & consulting work, focused now on startups through midcaps, on digital transformation, brand strategy, implications for the business of massive changes driven by technology. Will be presenting at cpa.com on “Pragmatic Innovation,”
- carolyn
- When we think of planning and growing a future ready firm you want to be the leader. Lead your team, your clients and the profession. As Steve Jobs says Innovation distinguishes a leader. So why are we focusing on the importance of innovation and building a future ready firm? B/c of the concept Templosion
- (explanation from SmartBrief http://www.smartbrief.com/s/2013/08/templosions-impact-competition) Templosion, the accelerated speed in which big changes are happening, has decreased the barriers to entry into the market and as a result, many more competitors now exist. This increased competition makes it more important for companies to create a timeless vision. If one only thinks in the short-term and does not change with the environment, there will most certainly be a competitor with a better idea. Hear from the AICPA's Thought Leadership panel as they explore templosion's impact on competition using Netflix as a case study. Example 2/3 of households have smart phones and 7% it is there only way they get online. Think how fast this adoption took place and changed the way we function. Hold to a vision of your business, but need to adjust and scrap ideas. Have to look long term, but adjust quickly to not succumb to the competitive affects of templosion. (can see in this video http://www.aicpa.org/News/AICPATV/Pages/home.aspx?bctid=2551647880001&Ca=Thought+Leadership+Series&Type=VideoCat)
- Means we need to be more nimble.
- 5 months to 3 yrs hard to project, gets fuzzy. Inside Tornado – by Moore Tipping Point – by Gladwell Crossing the Chasm – by Moore
- Amy picks up here w/ transitioning to Innovation Consistent w/ Moore’s definition – Innovation is about ANY type of differentiation that builds client preference, and as a result, enables you to increase revenue and profits.
- Amy talk about these 10 types A leading innovation consultancy firm called The Doblin Group, interestingly, acquired by Deloitte a few years ago – defined this model which identifies 10 types of innovation. So innovation is not just about product, it’s about how you configure your business, the offering itself, and the experience of doing business with you. And all of these types of innovation are possible for CPA practices.
- Samantha address the research from last yr on how the profession views innovation. When we look at the future readiness of the profession (which is a study done by CPA.com and Dr. Canton) we found profession as a whole saying they need to understand Innovation better, only 10% see themselves as innovative and 20% believe disruptive innovations will be driving influence in 2025. We are surveying early adopters and finding they have more of a focus on innovation than the profession as a whole, but are they saying they are good at it and doing it consistently? (need to look at the data from the survey)
- Samantha transition to Carolyn Now that we have talked about some concepts to consider when doing planning. Let’s talk to Carolyn Hall from Wiss on how their firm strategically planned for this growth given VUCA world. This is an example of a firm that didn’t just look at existing services and how they could grow clients and profits, but a firm that said they needed to take a completely new look at client needs and developed a new business with their firm.
- Our Managing Partner and a few other key leaders had the vision to develop this practice. Selected me to champion the initiative. Knew I would build off of our experience with the traditional O/S acct including write up work and after the fact reporting. Consulted with a strong IT individual to build the bridge between accounting and systems evaluation. Worked with a couple of other accounting professionals in the firm to develop this new business. Hired/trained a couple of dedicated staff based on an organizational chart that made sense for this niche. Attended the CPA.COM training on developing a cloud based practice After selecting the software platforms, Attended conferences like Digital CPA, Intuit and Intacct training Marketed our services within the firm and with current clients. Joined consulting groups like Boomer's producer circle to share ideas with others and help grow the business Created 90 day plans in this ever changing world Leveraged other resources in the firm like the partner's client base, IT dept., tax especially International expertise and marketing. Continuously worked on our levels of service including the pricing.
- As much as we had a few dedicated people to this new business, we all still had clients that we either needed to service on our own or transition to other staff members. Continuously worked on our levels of service including the pricing. We changed our levels of service about 4 times. We started with 5 levels, reduce it down to 3 levels and then moved items around to finally get to where we want to be. In the end, our marketing director came up with our bike, drive, fly transportation idea which I will show you in a few minutes. Each client is different. Even those in the same vertical have their own needs and request. In addition, most of our clients are new to the firm, so it takes a while to understand their business and the best way to service them. Trying to learn how to do that efficiently is still a challenge. We developed standard questionnaires that help. We have done some formal assessments for clients with existing processes and procedures and we continue to improve in this area. For us, pricing has become easier now that we have a basic format that we use to calculate the price including the software. Based on the value of the service, volume and software cost. Our website helps us reach new clients. Our sales team is truly our own partners/managers that are out in the field speaking with existing clients or with prospects. We continue to look for new ways to market our services including the use of a BD specialst.
- The buy-in from the leaders of the firm is only the beginning. Their continued involvement is critical to the whole process and the growth of this niche We communicate regularly. I meet with the managing partner every week for a status on the pipeline, proposals, staffing and even other firm issues I have a status mtg each week with my team. I periodically ask them if they are benefiting from these meetings and so far the response is 100% YES. Training is crucial. We train internally and externally. Re-evaluate our processes, our job duties and the team as a whole especially after about 12 to 18 months. I am starting to make more changes now that we have a good system in place which almost seems like a contradiction. However, now is the time to get more efficient so that we can service more clients and also service clients that are more complex.
- We developed this in one of our weekly status meetings and marketing put the finishing touches on. We have posters of this hanging in our work space It’s a good reminder of what we do everyday
- Did NOT happen overnight Different skills needed and it takes multiple teams coming together to get the desired results. From hiring data entry analyst and associates to ride the bike, technical and analytical professionals to drive the car, tax and IT specialist plus CFOs to fly the plane and marketing to pull it all together in a pretty package allowed us to get the results we started planning for two years ago.
- Amy review what Wiss did that led to success. Wiss case study reflects the steps that any team achieving success innovating will pass through. The leaders of the firm disconnected enough from day to day operations to spend real time on strategy. IF you have strong talent, open communications, good governance and controls you can empower your people and allocate quality time to defining your goals for the future. The people at Wiss showed open mindedness to change – respect the past, but don’t get buried in it. What made you successful may not be the key to future success. “Failure” is only a “failure” if you don’t learn from it and improve. I prefer to look at every trial as an opportunity to learn. Entrepreneurs use the phrase, ‘fail forward’ The firm stayed focus. It is very easy in today’s world to get distracted by new technology and the latest start up news – I call it the “shiny toys” syndrome. Startup founders who are successful share an incredible ability to keep their eye on the ball.
- Amy I would like to turn to some principles of what it takes to innovate your way to growth
- And there are many areas we could focus on, but for purposes of today’s discussion, I’d like to focus on the areas that have been identified in a recent cpa.com survey. Among members who are “early adopters” of digital technology, three common challenges were voiced: Where do I find the time How do I get the right talent How do I measure success And while seeing these 3 areas as challenges, it’s encouraging that early adopters do not see technology as a big obstacle – they are embracing the opportunity As we heard from Carolyn, Wiss took on all of these challenges – so the Wiss case example is a terrific source of insight to address these challenges.
- Amy Early adopters are using cloud technology, working on new business models for their services not using tech in traditional models – not just efficiency, a new way of engaging with clients and serving them. Culturally, responders self assess highest on listening to each other, being continuous learners, and sharing client feedback. These are all attributes of successful innovators. At the same time, even these early adopters acknowledge there is upside to improve on other attributes that are also very useful to achieving innovation results – these should come as no surprise 1. taking risks and 2. trying new ideas.
- Let’s address the 3 areas identified as the most challenging. First, Time. I want to point out that in today’s world, Speed by itself is a source of competitive advantage. I see as I work with startups, they run with a fierce focus, and do not accept bureaucracy, slow governance, slow process. They know their only advantage can be getting there faster than the next guy. Speed requires these behaviors, daily: Leader as sponsor not do-er – you cannot micromanage and move fast Putting in place the governance (top management on the hook), and comms and recognition so everyone in the firm sees the work is valued, and t hey should get out of the way. Delegating and empowering. What it really comes down to is … So are you enabing your best people to bring their best ideas to work and implement them? Bigger retention issue for millennials.
- Look for people within and beyond your firm who show: Intellectual curiosity Ability to connect non-obvious dots A “test-and-learn” mindset – see failure as opportunity A natural attraction to data but naturally look down the road, not just in the rear-view mirror Ways to create structure in the midst of ambiguity Strong communication and influence capabilities Resilience Technical skills are very important, but you may have people who are fabulous technicians but not innovators. That’s ok. It takes all kinds. You need both kinds.
- Since the definition of innovation is differentiating to create preference for your clients to grow revenues and profits, we want to identify and monitor the right metrics to see if this is happening. The newer a concept is, the less precedent in historical trends and data, the less likely it is you should be using just traditional business metrics and time horizons to measure success. The wrong metrics, or even the right metrics too soon, can stifle innovation or misread what the impact really is. So look at basics over time like – what is happening to revenue per client, the # of services a client is purchasing, are they referring others? Are you penetrating a new client segment or winning business you couldn’t win in the past? Wiss put a lot of weight on what was happening in client satisfaction – this is really important. It is always easier to retain and grow an existing relationship than to win a new one – so staying close to how clients are reacting and how that is affecting your numbers. Margin – when you launch any kind of new concept, at low volume it is premature to look at margin. Focus instead on what scale you think you can achieve, and monitor progress. Whatever you choose to measure: Be reasonable. Rather than trying for more precision than you can possibly get to, ask yourselves, “what would we have to believe for this to work financially” Focus on the business model and whether all of the drivers are moving in the right direction, not the bottom line. In my first big digital transformation role, my ceo used to say “find the unit profit model, THEN see if you can scale it. Focus on the metrics that will allow you to monitor if innovation is bringing you closer to the definition of success reflected in your firm’s strategy. Do you want to enter a new market? Expand relationships with current clients? Redesign your cost model for delivery? These are 3 different strategies that require different metrics.
- Samantha Recap how this all plays into the yr end planning and growing a future ready firm: When we think of growth and being future ready you should pause to reevaluate your growth strategies.
- It is not just the technology and not just the strategy and not just the leadership. It is the importance of combining the knowledge, strategies and tactics of all 3 that will help you grow a future ready firm. And doing all the study on your own while running a practice can be near impossible. Leverage a network of practitioners doing the same thing. Mention rest of survey data coming out in Amy’s keynote Super early bird price if want to register
- Mention rest of survey data coming out in Amy’s keynote Super early bird price if want to register
- We are centered on the power of smart business. This means a marriage of technology, strategy and regulatory requirements.