Our Practice of Now 2018 report revealed that 67% of accountants worldwide feel that the profession is more competitive than ever. Over a third (40%) of accountants feel more uncertain about their prospects compared to a year ago.
“It’s a challenging landscape,” says Jennifer Warawa, a former accountant.
“It used to be that my accountant was down the street or across town,” she said. “Today, people want an accountant who can really serve their business needs and they’ll go all the way across the country, and in some cases to another country. The playing field has been leveled and competition is everywhere.”
So, what can be done? Well, put simply you need to ensure you stand out amongst the competition. That comes down to focusing intensely on the three key areas that should already be drilled into every manager within an accounting firm:
- Improve the client experience
- Advance practice offerings
- Make better use of technology
Here are suggestions that might spur thought around these areas, or even drive outright changes to help you build a successful accounting practice.
Stay in touch
“The next generation of business leaders are looking for a relationship they can see as an extension to their management team,” said Bobby Lane, speaking to Sage Advice from his office at Blick Rothenberg, where he’s a Partner. “They want to be able to work with a practice that can solve their problems, explain what is going on in their business and support them on their journey.”
And those who have grown their practices from small acorns will have experienced that moment when this kind of personal touch is no longer feasible – or certainly much more difficult. A formal client management system becomes the only sane way forward, perhaps with assigned client managers.
But none of this means the personal touch should disappear. Those working within a growing practice just need to remember to be sincere as much as possible – and to be aware that communications technology has a habit of removing sincerity.
For example, when sending out client communication letters, always ensure they’re signed personally by the client manager or accountant who carried out the work. The same can apply to direct mailings. It might take 30 minutes to hand-sign each of hundreds of maybe even thousands of letters but, in a subtle way that matters, your customers will really appreciate seeing that small snippet of humanity that is your signature.
Signing letters or similar is ordinarily characterized as a marketing trick, but I invite you here to consider marketing as a fringe benefit. What should be driving your actions is a desire for client satisfaction, and a desire to put the client at the heart of your business by providing a consistent and authentic human connection.
Email or phone call? Consider the total amount of work involved. If you’re emailing a client about something like a new compliance requirement, and anticipate having to respond to several follow-up emails, why not set aside ten minutes to call them and explain it in person? Okay, so the client might then go on to explain a new problem they’re having – but that’s only more business for you.
In short, take any opportunity you can to provide a human touch for your clients – and don’t assume this kind of thing is necessarily time-consuming. While it’s certainly not as efficient as some forms of electronic communication, it also won’t eat into your schedule half as much as you think.
Invite clients to be involved
“Practices will have to adapt,” continued Lane. “They must communicate using the same channels, collaborate effectively and cultivate relationships.”
Client relationships are what defines a practice and must drive all decisions.
There is a prevalent urban legend that says car manufacturers deliberately introduce faults into vehicles that require the owner to return the car to the dealership. This gets the customer back into the showroom, the theory continues, and for car manufacturers that showroom is everything. Salespeople loiter. The newest models are there to touch. And free beverages relax the customer to encourage buying decisions.
Urban myth or not (and it almost certainly is!), there’s no reason why accounting firms can’t take a similar approach. No, you shouldn’t deliberately introduce faults into client books. But you can certainly invite clients to visit perhaps for seminars or sessions to explain new regulations or requirements, or even to listen to a keynote speaker (tip: People who’ve written books are often willing to talk for free by way of promotion, as are legislative bodies keen to get out the word about some new initiative).
An approach like this encourages stronger relationships with clients, and ultimately these relationships are one of your most valuable intangible assets. Yes, this kind of thing can also be good for marketing but again the avoid seeing it through that lens. If nothing else seeing it as marketing might engender a somewhat less genuine approach than is required. Here you’re simply attempting to show you care about your clients’ interests.
If there’s no space at your offices it might be worth hiring a room or hall somewhere. If you’re technologically savvy you might even livestream the event on Facebook or YouTube for those who can’t be there or record the event for your YouTube channel.
Make clients the center of innovation
There’s another reason why you might want to invite groups of clients into your business. Rather than give them something, you might ask for their help by creating client advisory committees – sometimes known as Customer Advisory Boards, or CABs. This is where you invite clients to provide feedback on your business and the services you offer, or perhaps even seek opinions on services you intend to offer.
Needless to say, running such a committee requires a degree of forethought. Simply gathering people together and saying, “How are we doing?” will produce chaotic results. Everything from choosing those who you want to invite onto the committee, to deciding on an agenda, should be carefully thought out beforehand. Some experts in this area advise creating a charter, for example, so that both you and the committee members know what you’re trying to achieve.
However, such committees can put your clients right at the heart of your decision making and innovation and can make your practice truly responsive.
Once again, there are ancillary marketing benefits in the fact that it can make clients more evangelical about your business – and therefore more likely to recommend you to others. But once again you should avoid driving this initiative from a marketing perspective. It should be considered an extension of your customer care methodology and as a way to ensure you put clients first.
Of course, requesting this kind of feedback – and using it to drive innovation – doesn’t necessarily require a committee. A personal request in writing or email from a client manager to a client might encourage them also to provide feedback – although this approach is perhaps more likely to get lost because of the sheer volume of messages we all deal with daily.
Specialize your practice!
“Practices have to be able to offer a broader service offering or will cease to exist in the future,” added Lane. “This means being able to work with clients in areas that may be lacking within their internal skills set, such as payroll, forecasting, preparing management accounts, staff incentive schemes, and more.”
There’s nearly always the potential to offer more specializations within a practice, of course. A general financial accounting practice can introduce a management accounting specialization, as just one example. Insolvency, tax, auditing, consulting, payroll – often adding that specialty to your firm can be as simple as hiring the right person, and growing that function can be as fundamentally simple as letting them have the freedom to form a business unit within your wider practice. You might consider funding training for an existing employee to achieve specialist qualifications.
However, less-frequently discussed is the prospect of providing accounting specializations within particular industries. While the fundamentals of accounting don’t change, somebody specializing in accounting for – say – the entertainment industry is going to have a different experience set and focus compared to somebody specializing in the food industry. Clients really care about this.
The benefit to a firm of specializing in particular industries is that getting new clients becomes a degree easier because, with smaller niche industries, in particular, the word can spread surprisingly quickly about accountants who have taken the time to understand the quirks of that business type. And as a business, you have a readymade marketing approach in the fact you’re the only specialist in that industry within your area. You might target trade organizations for that industry too.
Clients in return feel more confident when an accountant not only “speaks their language” but can cite previous examples where a certain process or approach within a specialist industry has produced results – especially if that approach has been proven to save money.
Hook-up with client data
“Clients will happily pay fees if they feel that they are getting value,” explained Lane. “They will see far greater value in the relationship if their fees are being spent on services that are adding value to the relationship rather than for pure processing.”
Cloud technology makes it possible for practices to have a 24/7 view of their client’s data – everything from their core ledgers to invoices that have been issued, to the timing when payments are received.
Needless to say, this opens up a world of possibilities for improving client service. There’s no more need to send tedious and annoying client reminders when it’s time for quarterly returns, for example, because the data is just a click away. But more than this, it puts the accountant in a position to provide proactive advice moving forward, such as fully-informed tax planning, or spotting problems before they have a chance to arise. It allows the role of the accountant to grow and evolve, as more of the accountant’s experience can be used – and stronger client relationships formed.
However, there’s also the potential to provide client focus in other ways by becoming an accounting software provider. This way you can not only earn commission on software subscription sales but also provide deployment services to businesses – while at the same time ensuring you create the fundamental setup that provides full visibility into the company accounting that’s healthy for both you and the client.
In most cases, your firm is already full of experts in both accounting and accounting software. So why not deploy this in ways that can provide additional income for your business?
Democratize data across the practice
In the old days, clients had files – real paper and manila cardboard! – that lived in filing cabinets. While a newer generation of accountants may barely remember such antiquities thanks to computer record keeping, it’s stunning how the culture of a single file and single-person client management lives on within many practices.
For example, if a client contacted you by phone what would the response be? Would whoever answered the call be able to help that person, or would they attempt to put the call through to the client manager/accountant – and then turn the client away if that person’s busy? How many clients enjoy being told they can’t be helped at the very moment they need it?
The ability for every staff member not just to have access to data in order to at least attempt to help clients, but also to be able to make their own notes for others showing their actions, provides a competitive advantage by ensuring clients get the best response each and every time. It’s another example of how fully embracing technology – in this case, competent practice management software – can be transformative within a practice.
“Practices must continue to develop their own internal systems,” said Lane. “This will drive the ability to move a client relationship to a broader and more strategic service offering.”
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