Are you ready for prime time? Tips for the heart of busy season.

As a managing partner, the time period from March 1 – April 15 was always my favorite. The office is humming- financial statements are flowing, tax returns and extensions are moving and the cash register is ringing. It is the heart of busy season and you have to be playing your “A” game. It is prime time for the firm’s financial well being and capitalizing on it is key. Keep these tips in mind to be a successful prime time player.

1. There are no benefits of the doubt – Clients have many more options and loyalty has been dissipating for quite some time. Do not think that clients know that you are busy at this time of the year, and therefore, it is ok to either not hear back from you at all, or to hear from you after a prolonged period of time. Clients need to know you are attentive year round. In this increasingly paperless world, you are undoubtedly being attacked by emails. Responding late or cryptically is not going to help the loyalty challenge. You have a couple of options. You can ask your administrative staff to survey your emails, report them to you and then advise the client or possibly your COI as to when you will reply. You can design an automatic response policy for your emails so that folks know you respond in 24 or 36 hours. You must take control. People have expectations, and the more clearly you state your policy, the more manageable their expectations will be.

2. Avoid surprises – Neither clients nor managing partners like surprises because most of them are not the good kind. Keep your billing very current and discuss extras with clients both before you tackle the work, and certainly before billing. You must be compliant with daily time sheets so billing can be done in real time. Engage firm leadership with problems at the earliest possible time – there is no upside in trying to be a hero – much more to be gained with transparency and being a team player.

3. Be people-centric – your two most valuable assets, clients and personnel, share a very important common denominator - they are people. As accountants, we excel at noting shortcomings, but we fail at packaging our comments for corrective upside and in delivering these comments in a timely manner. During prime time, you need to have staff performing at their best, which means you need to be alert and communicative. It is very important that your clients know that you care about your performance, so you should be including your clients in a performance feedback process and telling them that they will be asked to contribute. In today’s economic climate there is enormous pressure on fees, and if clients feel uncomfortable with your staff, the pressure mounts even more so. The economy also makes firms mindful of their investment in personnel. While cutting labor costs is a common post busy season exercise, it is in the best interest of all that you be aware of the full potential of your staff. Clients will have a view on the aptitude and skills of your staff that may result in deploying your personnel differently and more profitably. Post tax season you will need to present value-added deliverables to your clients and prospects. You may find that some of your personnel may be better suited for new areas than the old ones.

4. Be aware – the well being of the firm is not just the responsibility of the managing partner - it is the responsibility of all of the partners. Take note of the good and the bad that is going on and keep a list so that you can prioritize it after the busy season. Be very visible and alert – the more that people think you are watching, the better they will perform and the greater respect you will enjoy from your partners and peers.

5. Plant seeds – take advantage of the high level of engagement that you are experiencing with your clients and staff. On the staff side, ask them to keep a running list of the highs and lows and to be alert so you can improve next year and be a better organization. On the client level, tell them about areas that you want to explore with them in the post busy season to both whet their appetites and to position the firm for growth. Make every effort to schedule the post busy season meeting when you are discussing their taxes or financials - and follow it up with a personal note.

The mark of an organization is best determined when they are functioning under stress during peak demand. Your clients, personnel and centers of influence are very alert as to how you perform - especially during busy season. Your job during the heart of that season is to give them things to be impressed with.

Looking for Mr. or Ms. Right – Who is your best referral source?

Walk into the lobby of most accounting firms and you will hear the managing partner chanting to the partners, “Go out and bring in the business! We have a lot of mouths to feed!” Ideally, as the partners and sales team are beating the pavement, they have well defined goals and objectives. Having strong referral sources makes the business development process much easier and more fun. What determines who your best referral source is? What are the attributes to look for to make that perfect match? Keep the following in mind as you search for the perfect match:

Compatibility - sharing clients is not the definition that works here. You and your source have to be compatible. You should be able to have a couple of common interests other than business. So as you are searching for lead generators, you really need to listen and learn about their family life, hobbies and points of distraction. The more you share the better. The more you can connect with them, the stronger the magnet. People will generally favor people they like, so finding ways to be liked is critical. It is not friendship you are striving for - it is comfort.

Intellectual Chemistry - going beyond the client at hand or the prospect is the key. Both of you must be able to brainstorm on professional matters with no strings attached. Picking each other's brains on technical matters has to be a common occurrence. The deeper you get into each other's competency, the more secure the relationship and the more intensely you will watch each other's back. Serving as a full service intellectual resource, even when it is not with a shared client or prospect, will position the relationship for many more common causes.

Inclusiveness - this is much more than being on the guest list for firm events. The quality of this characteristic is a function of how you each introduce the other to your own centers and spheres of influence - and how often. Are you helping each other go beyond the firm-to-firm or business-to-business goal and creating a networking relationship? The less selfish you each are with your contacts and points of influence, the more inclusive and the more sincere the relationship will become.

Complimentary Engagement - this isn’t just the ability to say nice things to each other. You want a referral relationship that generates assignments in areas where you not only excel, but enjoy as well. When this occurs, people will truly appreciate the value of your expertise. The best way to broadcast and boast of success to potential clients comes after a positive working experience on a mutual project. Complimentary engagement must include positioning each other in areas where you each perform best.

A referral relationship, just like a marriage, is a two way street. The best referral relationships will embrace the factors noted above whether they are with clients or independent resources. Many referral relationships have the potential to be your best and certainly to become better – it is up to you and your potential mate to make it work - and that means making it work at all times during the year including tax season and busy season.

Maximizing the Value of Your Tax and Busy Seasons in 5 Easy Steps:

Most accounting practices spend a fair amount of timing preparing and planning for their busiest time of the year. Minimum required hours, mandatory independent reviews, specific processing procedures, technical standards of practice and billings/collections policies are commonly addressed. Few firms however, plan for gaining value beyond the obvious economic benefits of cash flow and staff utilization. Here are 5 ways to enhance the value of your busiest time of the year:

1. Remember that being in a service business requires an emphasis on customer service. Each client should receive a personalized thank you note from either the partner in charge of the engagement or the engagement team. Along with thanking the client, the client should be encouraged to recommend ways that the firm can improve. Demonstrating that you care and appreciate your clients can only enhance your relationship. A conversation about improvement offers you the opportunity to put the input to good use, vests the client more deeply in the relationship and will set the table for the possibility of increasing the level of service.

2. Capitalize on your success. A satisfied client can generate great credibility with prospects and centers of influence. Often clients are not aware of the fact that your practice is in an expansion mode or that, by nature, your practice needs a steady flow of new business to perpetuate the business cycle. Make sure you ask for referrals and endorsements especially when positive results and efforts are fresh in mind during your busiest time of the year.

3. Keep your staff in top condition. The quality of a firm is dependent in large part on its people. Firms go to great lengths to evaluate their staff - but the evaluations generally go in a file and are not used by management to facilitate progress. During the busiest of times you don’t want your staff to perpetuate weaknesses - you want them to avoid them and overcome them. Make sure that practice leaders are briefed on the areas of concern so they can monitor performance, intervene and keep the staff in peak form. A summary of the previous evaluation and a working draft of a new evaluation should be in an active file and open at all times during the season. Getting people to perform during the crunch time is not only beneficial for the busy time, it will set things in motion for progress during the slow time as well. 

4. Tune up your engagement monitoring process. Use a job management system that will alert the primary biller when stages of economic consequence have been achieved on an engagement. At a minimum, set an alert for when 50% of the budget has been hit. Catching trends before they become problems that can’t be corrected is vitally important. When your staff is aware that you are aware, it will encourage communication, stimulate efficiency and most importantly, create an opportunity to approach the client in a timely fashion for a fee adjustment before any irreversible damage has been done. The more confident the clients and staff are with your management procedures especially during times of stress, the more success you will have in maximizing the billing and collection cycles. Setting a standard for monitoring at your most challenging time sets the tone for the entire year. 

5. Demonstrate a concern for clients that transcends busy season. While clients should always know that you are available to them whether it is during your busiest season or otherwise- at this time of year you have your clients’ attention - so use it wisely. That means developing an agenda for matters other than compliance, starting the conversation during the season and scheduling a follow-up meeting right after the season ends. Let clients know you want them to help you find your way back to post season sanity by asking them to join you in a fun setting for that next meeting. Making your clients a part of your life and thinking of them during your busy time goes a long way towards building and maintaining long lasting loyalty. 

Your firm is tested in many ways during its busiest seasons. Making the right impression on your clients and staff is a great way to score so high on the tests that you can enjoy long term value. Take the necessary steps to impress - you owe it to your clients and to your firm.

 

Five Straightforward Ways You Can Position Your Firm for Financial Success in 2010

The right kind of business makes money in good times and bad. Leaders of successful businesses don’t become less aggressive in bad times. They become more focused during a time of challenge and use aggressive measures to secure strong financial results. Leaders of CPA firms must operate in a similar fashion. Controlling costs goes hand and hand with being a CPA, but that is never enough. The vitality of the revenue stream has to be a focal point and a core cultural priority within a firm. Here are five ways to enhance the vitality of your revenue stream.

1. Minimum Tax Preparation Fees – Develop a minimum fee for every kind of tax return that your firm prepares. As skilled professionals you need to keep up with an ever-evolving set of laws and regulations. This time is not allocated to the client, yet it is a real factor in the value you bring to the client. Expertise tends to bring efficiency, which is great from an internal standpoint, but that same proficiency can easily work against you without a minimum fee unless you have an extra premium built into your billing rates, which is most unusual for the industry. Clients have established a frame of value and will use it quite regularly especially when they ask for a capped fee. Minimum fees will have a positive impact on your revenue and will help you be in more in control of the definition of value.

2. Rigorous Monthly Billing Policy – The first 10 days of the month should have a strong billing emphasis. Set a floor for holding WIP and require that everything else must be billed or defended within the first 10 days of the month. Fixed-fee engagements that may require attention only several times a year should have an apportioned bill sent out each month. Clients can better budget and manage their cash expenditures with a monthly billing procedure and the firm will have a healthier cash flow as well. In addition to the 10-day billing program, you need to have real-time billing as well. For example, if you prepare a tax return, send the bill with the completed return as soon as it is done. If you complete a project or complete a stage of a project, then bill as soon as you hit that point. Each month, in addition to billing, statements need to go out with handwritten notes from the partner.

3. Retainers – All new clients should be required to submit a retainer prior to the commencement of the engagement. The size of the retainer will be dictated by the anticipated scope of work and or type of work for which you may have a policy requiring a minimum retainer no matter what the size of engagement.

4. Blended Rates – Accounting firms need to be cognizant of their buyer’s mentality. Most clients are very aware of the financial concepts of break even, profit margin and average costs. Using a blended firm rate when you budget and quote a job can be an effective way to generate client comfort with bills and value. There are two approaches to this calculation: An overall blended rate for all firm professionals inclusive of owners, or a two-tiered approach -- one for employees and one for owners.

5. Promote Client Responsibility and Accountability – In the current economic climate, layoffs in the accounting department are not unusual so engagements may be delayed, or worse yet, may start and stop. Engagements letters must be very clear as to delivery timetables and turn-around time expectations for both the firm and the client. When inefficiencies are created due to the client’s delay or failure to deliver timely, the firm has to be allowed to employ specific measures to compensate for these problems. This is especially critical when we accountants are expected to live by multi–year fee locks. Measures worth considering if there is not adequate notice of change or continuing delays, include a right to rebid the job, extra billing at agreed-upon rates, a flat rescheduling charge, or the right to resign with an accelerated notice.

Hit the ground running in 2010. You and your firm deserve financial success—add to this list of action steps and make the right things happen.

Item #1 On Your Shopping List

This is the time of year when carrying a shopping list is quite common. Managing partners of CPA firms tend to carry a shopping list of their own with them all year round. No matter the occasion for the list, the key is to be sure to succeed in getting the top items on the list. For some time now, the #1 item for managing partners to secure has been “The Rainmaking Partner”. The demand for this person has been so strong that an industry has developed to manufacture these folks from the raw materials (existing partners and partners-in-training) in firms throughout the country. The Rainmaking Partner will continue to be a hot ticket, but since it is the holiday season, now is the right time to search for something really special, so make sure you are on the lookout for… “The Entrepreneurial Partner!”

The Entrepreneurial Partner much like The Rainmaking Partner can come in many different shapes and forms. Business development savvy is one of the characteristics, but the mindset of this individual is much more proprietary than a salesperson. This partner will consider the upside and downside of client relationships. Efficiencies, budgeting and financial performance will be an active concern in their daily quest for business. This individual will view their role as being a multifaceted advisor to their clients and not primarily a technician. This individual will be a student of business performance—extremely knowledgeable about the operations of their clients, the metrics of their clients’ industries and the industries they enjoy servicing.

Other characteristics include visionary tendencies both for your firm and the profession. Their vision for your accounting practice will reflect the fact that the firm is in a business and it needs to be managed and advanced in ways which emphasize the good of the firm and not particular individuals. Their comfort and self confidence allows them to approach being a partner in a holistic fashion. This kind of partner works to build strong bridges between employees and management. Their concern for the well being of their clients and the firm drives them to share their knowledge with compassion and passion. Their vision for the profession will emphasize the accountant’s role in integrating historical, current and prospective financial data. They will be advocates for requiring accountants to maintain knowledge in the core elements of the profession with mandatory education standards in all aspects, including tax, consulting and assurance.

This all may seem too good to be true. Years ago when The Rainmaking Partner was introduced, people wondered if that was just a dream. Today we all know how real this kind of partner is. The Entrepreneurial Partner is really not new, it just isn’t as common as it was in the ‘70s and ‘80s when so many were entering the profession. Your quest for this special partner should not restrict you to looking only at folks who are employed by accounting firms. CPAs and accountants who never have worked in a public accounting firm should be pursued as well. These people are used to teamwork and have a real working knowledge of the dynamics of the world of business—both very essential characteristics for this role.

Much like any #1 item on a shopping list, there will be high demand. The good news is that there are plenty of us from that generation around who can groom a new group and you don’t need to wait on any long lines at the cashier or load up on batteries. Now take out your shopping lists and make sure The Entrepreneurial Partner is item #1.

Success Planning: The most important step in your succession plan

As we all know, accountants tend to be risk averse and highly risk conscious. An entrepreneur will be stimulated by the upside potential of a distressed or mismanaged asset and the accountant will prefer to feel the thrill living vicariously through their client. The more successful a business, the more comfortable an accountant will be with it—so the more successful your practice is, the more likely it will be for people in your organization to feel motivated to join your ownership structure or even succeed you.

The definition of success will vary, but a successful firm requires leadership. Leadership is best handled by folks who can balance technical and entrepreneurial attributes. All too often in the accounting world, the pool of people available to rise to ownership is composed of those with staying power and not necessarily the best of those who originally jumped into your employment pool. Just as you plan for the success of your client engagements, you must plan for the success of your firm, and part of that plan must include entrepreneurial development of your personnel. Now is the time to make some aggressive moves to enhance the present and future of your firm. Consider the following initiatives as a method to put people to the test early and to build their skills effectively.

• Use a Reverse Mentoring System – the common buddy system is employed to help new employees transition and to facilitate their professional development. The reverse system will put your employees in the role of mentoring your owners in areas that are comfortable for the staff and not necessarily comfortable for the owners. Technology is a perfect example with social media marketing being a timely issue. Your staff, and specifically, your early-level practitioners, are very savvy with these matters—let’s see how comfortable they can be working with authoritative figures like the owners in areas where they are the experts. This empowering process will build confidence and will breed success in endeavors that require new perspective. The earlier in the cycle that you get a handle on someone, the more you can do to make the right decisions about them and their long term value to the firm.
  
  
• Create an Employee Council – the size of this group will vary depending on the size of your firm and the agenda that you delegate to it. Each member of your firm has likely had experience leading peers in student, athletic or other similar organizations. Yet as owners, you have little opportunity to see how they manage the challenges of peers outside of small engagement teams. You regularly entrust your clients to the wisdom of your staff, but how routinely do you tap their input for the advancement of the firm? Give employees an opportunity to contribute in both ideas and actions. You can start slowly and use the council to direct social-oriented matters like firm outings and build your way up to conducting upward reviews and facilitating efficiency and profitability studies.
  
  
• Humanize the Owners – you need to put an end to the owners just being the bosses. Beyond being polite and interested in the lives of your staff, the owners have to conduct themselves in a manner that will entice people to eagerly want to be on the partner track. Having a life outside the office means a great deal. Encourage your owners to share their hobbies and interests. Converting lunches into hobby hours or cultural exchanges with active owner involvement will make a big impact. The more comfortable people are with those who share their work environment, the more meaningful that environment will be to them and the more committed they will be. It is also important to encourage your employees to have balance in their life, not only because it is healthy but because it will build bridges to better client relationships and referral success.
  
  
• Introduce a Communication Competency Curriculum – mastering every form of communication is essential and structuring a process to do that is essential. Most accountants shy away from written communication and the advent of email has corrupted writing skills. Emphasizing writing early in the career is important. Use creative writing and business writing exercises. Drill your staff on verbal communications as well by simulating proposal meetings, irate client calls, new business inquiries, and internal conversations. Consider surprise calls to evaluate and shadow performance. Develop a protocol for response to clients including turn around time and script and be sure to test the program. If clients, potential clients and centers of influence are comfortable communicating with you and your firm, success will become a routine result for you. The curriculum needs to be one that will help people at every level of your organization and it is one that no one will ever be exempt from. Leaders need strong communication skills—the sooner you assess strengths and weaknesses in this area, the better off you will be.

Successful accounting firms are defined by their people. The more talent the people they employ, the more successful the firm. Keep your eye on your employees. Make their success with their people-to-people skills a top priority, and your succession plan will be well on its way to reality.

TAKE A LOOK IN THE MARKETING MIRROR

I am pretty confident that if a survey were conducted of business owners as to who they would turn to for marketing expertise and support, their accountant would be low on the list. Yet when it comes to marketing for CPA firms, the partners in firm behave as if they would be one of the top go-to resources.

 There certainly are some very gifted marketers who happen to be CPAs, but most would not win a marketing prize. The vast majority of CPAs are wonderful advisors and yet when it comes to marketing their own firms, they are reluctant to seek the kind of input they so vigorously advocate that their clients solicit from their professional team. In today’s difficult economy, every marketing dollar is a precious and important one so we all need to spend wisely. Take a look in the marketing mirror and recognize you may not be the fairest in the land. Here are 10 action steps to gain proper input for marketing your firm, put your capital to the best applications, and improve your marketing complexion.

1. Assemble a Board of Advisors for your marketing effort – it should include clients, centers of influence and local journalists.
2. Conduct a targeted survey with staff, clients and COIs on the marketing initiatives and practice development efforts that you have used and may use to evaluate the effectiveness of the program and message.
3. Put your proposals under the microscope – gain input form clients and prospective clients on the content and the dos and don’ts for your prototypes.
4. Solicit a peer review on your marketing agenda, materials and marketing plan from a friendly firm in another geographic region or market.
5. Perform a SWOT analysis of your marketing, branding and business development and evaluate progress quarterly.
6. Require quarterly self-assessments by your marketing personnel and rainmakers to determine where to maintain consistency and where to recalibrate.
7. Qualify prospects before you invest your time and money.
8. Be market intelligent – prepare and role-play in advance of a meeting and debrief after wins and losses.
9. Stay in touch – have someone from marketing touch base with the ones you win and the ones you loose.
10. Find the right coach – turn to outside consultants who can provoke and mentor the kind of actions that will improve your return on investment.

Keep on looking in the marketing mirror. You can never be too perfect!

WANTED: BUSINESS DEVELOPMENT SPECIALIST - RESPONSIBILITIES INCLUDE: ?????

Increasing numbers of accounting firms are bringing business development specialists into their sales process or onto their sales team. Even those firms with very proficient rainmaking partners are strongly considering the position, so there could be tough competition to attract the right person. If you are one of those firms exploring the possibility, or already in the recruiting process, consider the following:

1. Will this person be an accountant?
2. How will your prospects and COIs relate to a non-accountant and to the position?
3. Will the firm culture accept an outsider and will it respect a non-accountant in the role?
4. Is there a professional in your firm who can fill the position?
5. What accountability system will be used?
6. How will the marketing specialists interface with this person? What are the lines of demarcation?
7. What is the right compensation model?
8. Who will this person report to and how frequently?
9. What authority and budget privileges will they have?
10. What are the short-term and long-term goals? How will they be measured?
11. How will this person interface with the owners and who if anyone will they manage?
12. What kind of reports and reporting will be utilized?
13. Why would this person want to work for your firm?

As you proceed, you need to be mindful of signs of the owners and existing sales crew slacking off and relying too much on the specialist—the idea is to supplement, not replace.

Furthermore, I recommend you take a hard look at why you are making this move and be sure you understand your existing conditions. Are your results less than satisfactory for reasons that won't change sufficiently when the specialist comes on board?

Finally, you should concern yourself with how your competition will react to your new initiative and how your competition makes use of their specialist if they have one. Making a move like this is an out of the box move—you need to be sure you are thinking out of the box in so many areas not just this one.