Commentary:
From knowing to doing
By Neil Guilmette and Andrew S. Bluestone
If your firm is not achieving controlled profitable growth at a rate
of 20 percent per year or more, if you are struggling to find and retain
top-notch staff, if partners are working harder to keep less, if fees
are an issue with your clients, if you feel you are struggling to
maintain mediocre growth - doing what you've always done will only
create more of the same.
Hoping to create a different result by doing what you've always done
is Einstein's definition of insanity.
To create a different result requires change. Change is difficult.
What specific changes to make to create your desired result is another
issue. That journey begins by clearly defining specific results in terms
of income and quality of life sought for the partners and staff.
What are the results that you want? What changes must be introduced
to achieve them? How long will it take? What is the cost versus the
benefit? How will you create the change? How will you know where to
begin? How will you overcome inertia? How will you know when you arrive?
Who will make the decision, and when?
The journey begins with a decision. Say there are three frogs on a
lily pad, and one decides to jump. How many frogs are left? The correct
answer is three. Deciding to jump is vastly different from jumping.
A trap that firms fall into is confusing making a decision with
creating results. We tend to become obsessed with making the right
decision (paralysis by analysis), which in itself becomes a major
obstacle. Did we make the right decision? Did we have all the
information requisite to make the decision? Is it possible that a better
decision could have been made if better information were produced?
While it's always better to make the right decision rather than the
wrong decision, we forget the simple fact that a decision by itself
changes nothing. Did you implement the decision? Did you do anything? A
decision is the beginning of the process of doing, not the end of the
process.
Doing something actually requires ... doing something. Doing makes
things happen.
The currently popular concept of knowledge management advocates
gaining intellectual capital to grow your firm. Learn forensic
accounting, hire MBAs, develop niche-specific knowledge and get
additional certifications. The American Institute of CPAs is advocating
an internationally recognized certification and has added specialty
designations for business valuations, among others.
What advocates seem to forget is that knowledge is only useful if you
do something with it. There is a huge knowing-doing gap. Doing something
actually means doing something! It means addressing the hard and scary
work of making something happen. It's much easier and safer to sit
around and have meetings and intellectual conversations, to add to your
library, build databases, train for additional certifications, invest in
technical infrastructure - and never actually implement anything.
Doing means learning. Learning means making mistakes. Learning means
tolerating inefficiency. Learning means tolerating failure. Learning
requires encouraging and teaching people to try things they've never
done before, to try things beyond their existing abilities.
The only way people learn is by doing things they've never done
before. If we only do what we already know how to do, we won't ever
learn anything. The firm must make learning and stretching the envelope
mandatory. It must acknowledge and support effort. Repeated effort and
doing creates change.
There is no easy way to encourage people to learn. They must be
motivated to learn for their own reasons, not the firm's. You must
address the WIIFM factor (What's in it for me?). You must accept the
fact that there's always going to be a trade-off between efficiency and
learning.
Learners are never as proficient as experts. Learning comes at a
price. One price is the experts might not get to use their expertise and
the learners might make mistakes. If you really want to build a learning
organization, you must be prepared to make the investment.
The biggest obstacle to learning is fear. The most powerful and
pervasive emotion in the workplace today is fear - fear of feeling
foolish, fear of clients, fear of billing, fear of failure, fear of peer
pressure, the accountant's cultural fear of making a mistake.
Learning requires tolerating people who make mistakes. Learning means
tolerating inefficiency. Learning means tolerating failure. To move from
knowing to doing you need to change your firm culture to the opposite of
traditional thinking. You must build a culture of forgiveness. A
tolerance for error and failure must be built into the firm culture, not
for accounting-specific issues, but for growth and development.
Traditional culture says, "Quality is the absence of defects as
defined by management or professional edict." We believe that quality is
the presence of value as defined by the customer.
The entire culture of the profession, right down to the name itself,
has developed around the concept of accountability. If you are to be
held accountable for every mistake that you make, how many chances are
you going to take? If you live in a culture that reveres perfection, how
will you handle the mistakes of the learning process? How eager will you
be to convert your ideas into actions?
"That's the way we've always done it." Another huge obstacle to
cultural change is professional (or corporate) memory. The underlying
emotion is, again, fear. Mistakes are the bane of the profession. The
best way to avoid mistakes is to continue to do things the way they've
always been done. That's fine for the attest function - but it severely
limits non-attest functions and restricts change.
Eventually, like with hourly billing, what was originally adopted as
a means to an end becomes the end itself. What are created are sacred
cows - things that are taken for granted, beliefs, processes, practices,
rules that you perceive will help you get things done. In truth, all
they do is create obstacles to getting things done.
So where do we begin?
Begin by making a decision to do something. Be open to change. Begin
by building a culture of action. Cultural change is evolution, not
revolution. It takes time. Be prepared to make an investment in time and
money. Be prepared to start doing. If the doing is consistent, you can
expect a handsome return on your investment.
If you expect the future to be better than the present, you need to
begin now. Plan your work and work your plan. Remember that your goal is
better than, not optimal. Do something today better than you did
yesterday. Enjoy the result. Gain confidence. Internalize the new
behavior. Then do something tomorrow that's better than today.
Internalize the results and move ahead.
Neil Guilmette is executive director of Stony Brook, N.Y.-based CPA
Network, a practice management organization for CPA firms. Andrew S.
Bluestone, CFP, is the president and CEO of Selective Benefits Group, a
financial services firm in the New York Metropolitan area.
Goodwill Builders
By Joseph Anthony, CPA
For many tax professionals, finding potential clients is not a
problem. Developing the right relationship with new clients, and maintaining
high levels of satisfaction and goodwill with existing clients, is often more of
an issue.
"We find that when clients leave an accountant, it is far more
often because of perceived neglect than because of the fees they are charged,"
says Chris Frederiksen, a CPA, consultant, and chairman of the 2020 Group, which
provides business advice and services to tax professionals.
So how can tax pros build goodwill in their practice with both
new and long-time clients? Here are seven ideas to keep in mind when reviewing
your own practice:
Emphasize benefits, not
services. "We want to have clients see the accounting professional as a
profit center rather than as an expense," says Neil Guilmette, executive
director of CPA Network in Stony Brook, NY, a nonprofit association dedicated
to, as Guilmette says, "helping accounting pros grow their practices, make more
money and enhance their quality of life."
"You want to make the transition from being an
accountant who gives advice to being a business advisor who happens to have an
expertise in accounting," says Guilmette.
Have a sophisticated communication system with
your clients. That means, Frederiksen says, having a way of staying in
regular email contact with your clients. He recommends developing a system,
either in-house or using an outside contractor, so that clients get some sort of
newsletter or email update every couple of weeks with business or accounting
information and news that might be useful or interesting to them.
Work that website. Frederiksen says that
it's important for tax pros to have what he calls, "a killer website."
"I define that as a website that someone might
want to visit more than once," says Frederiksen, tongue firmly in cheek. "So you
want a website that has interesting tools that your clients can use and other
business information that would be a resource to clients."
Develop a client portal. Tax pros can send
clients data by email, of course, but that can involve several steps to make
sure that confidential data is being sent both accurately and securely.
Frederiksen prefers seeing tax pros set up the
electronic part of their practices so clients can go to a central site or portal
and get information or files that pertain specifically to them. Typically,
clients will get an email telling them there is new mail waiting for them, and
they can then go to your site, enter a security code, and look at whatever
you've posted for them. "We commonly call this a portal, but I personally prefer
to use the term, 'client mailbox,' just because I think that is more
intelligible for the client," Frederiksen says.
Be a data repository. Tax pros routinely
save client tax-related data in either paper or electronic format. You can also
leverage the money you've already spent on technology to provide other low-cost
but potentially invaluable services to your clients. One example: offer to scan
into your computer system such crucial documents as passports, birth
certificates, and marriage certificates. "If a client has a crisis such as
losing a passport while out of the country, he could get on the internet, go to
your portal or client mailbox, and retrieve a copy of the passport," says
Frederiksen. "How much is that going to be worth to him?"
Use your key performance indicators. Tax
pros are familiar with all sorts of indicators and ratios that help them analyze
the health and potential future of a business. "You can use the same analytical
tools and concepts to ask clients what they need-where are they stuck, how can
you apply your training and skills to help them," says Guilmette. "Instead of
just answering questions and showing the client how smart you are, you can ask
questions and show the client how you can help him."
Get proactive as well as reactive. The next
area of developing goodwill with clients is to be able to offer comprehensive
holistic wealth management. "Historically, CPAs have focused just on tax
planning and estate planning and showing clients how to beat the taxman," says
Frederickson. "Developing goodwill increasingly means being able to offer
comprehensive holistic wealth management-assistance and advice on retirement
planning, long-term care, education planning, investing, succession planning; in
other words, getting far more involved in the client's life planning rather than
just being reactive."
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