Keenan Pitches Outsourcing to CPAs

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Glen Keenan watched his father spin off a small practice after making partner at KPMG, grow it to a regional firm and eventually sell it to RSM McGladrey. After interning for his dad and spending nearly a decade at Deloitte and Touche, the “technology bug” bit him, and he left in the midst of the dot-com bubble for a startup company, where everyone wore shorts and flip-flops.

In 2003, he moved on to Xpitax, a company that outsources accounting work to India — a hard sell even today, but one that is gaining popularity as the quality improves and the staffing shortage increases. As president responsible for international growth and operations, Keenan helped the company expand to XCM Solutions, which also provides workflow tools that let his 250 accounting firm clients electronically track what everyone in every city and country is working on, instead of relying on paper trails.

The 37-year-old Massachusetts native pitches the importance of staying hip on technology in order to attract the next generation of CPAs, but also acknowledges the need to accommodate those industry veterans who want to stick with pencils and paper.

Partner Insights

What attracted you to technology?

Deloitte had audit software similar to CCH Engagement. I got involved with building out that technology for the government sector, moved into what was then a new group, enterprise risk services, doing technology consulting. There were six to seven people in the Boston office in that group. Today, there’s probably 150. I wanted to help build something while still having the safety net us CPAs like of having Big Brother there to pay for everything and none of the risks of being an entrepreneur.

Why did you leave?

I struggled with, do I want to stay and try to make partner or do I go into private industry, and if I want to come back I would be more valuable having a different perspective on business. I went to a small startup technology company that [had] venture money without a product, typical dot-com stuff. We got a CEO out of Thomson and we bought five technology companies in the next three years. It was a $10 million company when I left, and it was spun off into different companies.

There’s still a negative stigma associated with outsourcing. How do you win that argument?

CPA firms acknowledge they need people. We have the people. So why won’t they do it? Because of security, quality, their clients’ and staff’s reaction and because they think they’ll lose control. We explain our security process and ask them to compare it to their own. We never talk about security again. You have a lot more control because you have to do everything digitally, so you know where everything is every minute of every day. Your staff gets to do more interesting work. Everybody’s elevating their career. But you have to address it with your staff way up front to say why you’re doing it. Client reaction is nonexistent. Put the disclosures out there and say it’s just a way to get it done more efficiently so you don’t have to charge as much. One of our clients has 10,000 individual clients. Twelve people had an issue. Don’t send those returns.

How are you measuring quality?

You’re going to get a good job done for certain things. You’re sending the things that could be done remotely. You’re not communicating with the client, you’re doing the preparation. If clients don’t like something, we look at how we can train people systematically so it doesn’t happen again.

Younger people like gadgets, but how do you blend different generations working together?

We hired a tax compliance officer two years ago who has 30 years’ experience. He was a paper guy. He said, ‘I’ll learn it, but I don’t want to do it that way, and all your clients look like me.’ You have to be [flexible]. Provide best practices and [tell them], they can do it their own way, but they still have to be accountable for the same amount of work. A lot of the time, it changes what people do. If you have a 70-year-old CPA, his value is not preparing workpapers, so have someone else do that work for him. Look at who you have and have them do what they’re good at and not everything else.

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