Lessons in growth

June 12, 2024 9:30 AM

There is no single path to growth: Most often, accounting firms approach it from multiple directions, in multiple ways.

As implied in the name, the acceleration and improvement of business was the driving theme of Accounting Today's 2024 Firm Growth Forum, held May 21-22 in San Diego, and at this year's event, expert practitioners, consultants and service providers shared their actionable insights about how accounting firms can achieve this growth, as well key advice on addressing the profession's other urgent needs — from the staffing shortage to changing client expectations.

Here, we've rounded up several of the biggest takeaways and pearls of wisdom from this year's Firm Growth Forum.

Growth Catalysts keynote panelists (from left to right): TLTurner Group CEO Terrell Turner, Opsahl Dawson managing partner Aaron Dawson, ASE Group founder Al-Nesha Jones, High Rock Accounting CEO and founder Liz Mason, and Accounting Today editor-in-chief Daniel Hood

Jesse Sutton

Curate clients carefully

It's not merely capacity issues that inspired Opsahl Dawson managing partner Aaron Dawson to guide his team with this philosophy, as he shared during the opening keynote at Firm Growth Forum. It has also fueled the Vancouver, Washington-based firm's exceptional growth over the last year — an uptick that led to the firm being honored with an Accounting Today 2024 Fastest-Growing Firms Award in a ceremony that closed out this year's conference.

The firm "made an intentional choice for higher-quality work and said no to other work," Dawson explained during the panel. "It created capacity in the firm that really started to grow, and we've been doing that ever since."

Dawson's fellow panelist, Al-Nesha Jones, agreed. "Sometimes you have to slow down to grow faster," said Jones, founder of ASE Group, whose firm did just that when they switched to a subscription-based model three years ago and then had to let go of the clients that weren't onboard. She quoted a friend in describing how her firm approaches the firing clients so many accountants are averse to: "We don't send them away; we invite them to be successful somewhere else."

Tim Moy

Jesse Sutton

Get overstaffed

It may sound crazy in the midst of a staffing crisis, but Tim Moy urged Firm Growth Forum attendees to hire more people than they currently need.

"We're making the choice to never be understaffed," said Moy, the owner of Baraboo, Wisconsin-based MBE CPAs. "Most firms are 10 to 15% understaffed, but from a growth perspective, you should be 5 to 10% overstaffed."

Having extra capacity gives a firm room to take on new business without having to worry about bandwidth, but it also sends an important message to current staff, who often feel overburdened: "You're not going to have to grind grind grind," said Moy. "We have to make a bold move, to give our staff hope."

Terrell Turner, Aaron Dawson and Al-Nesha Jones

Jesse Sutton

Build a firm you’d want to work in

This version of a golden rule for creating a good workplace culture might seem obvious, but with the current talent crisis and an urgency to provide staff with all-important career sustainability, Al-Nesha Jones' mantra should be foundational to accounting practices. While her team is fairly small, Jones explained during the keynote panel, it must be "a place I'd want to work, and other people want to work."

In the same vein, Jones learned she must follow her own advice; when she implemented four-day workweeks for her team, she found she was still working some Fridays — which made some staff feel that they should, too. So now when she writes emails Friday, she schedules them to go out Monday morning, and when the office closes early, she also leaves.

"I can't put undue pressure on the team," she told the attendees. "I realized the tone at the top is not just taking care of the team, but the same things I'm doing for them I have to do for myself. I have to be a role model and say, 'See, I do the same things I'm telling you to do.' So they know it's OK."

Ask the right people

All too many firms just sit back and wait for referrals to roll in, but the most successful firms proactively reach out to their current clients and ask them to help bring in business.

But don't ask all of your clients, said Val Steed, director accountants at software developer Zoho Corp.; just ask your favorite clients — the ones you like with working with the most, and who fit your ideal client profile. They'll be the ones who refer the best prospects because, as Steed explained, "Good people hang out with good people."

Create sustainable careers

Career sustainability is "the new super skill," according to Bonnie Buol Ruszczyk, president of BBR Cos. Presenting data gleaned under her leadership of the Accounting MOVE Project, which conducts an annual survey of accounting firms regarding women in leadership, women's initiatives, and career strategies, Ruszczyk noted that 50% of women opt out or leave firms before reaching partner.

Ruszczyk broke down the hallmarks of firms that do embrace career sustainability. They:

Provide young millennials and Gen Z employees with early leadership opportunities;
Create programs that allow younger employees to connect to and learn from open-minded parties;
Include managers in succession planning; and,
Inspire team members at every stage.

Build your marketing muscle

Firm leaders can no longer throw up their hands at the prospect of marketing. Terrell Turner, CEO of TLTurner Group, described this as a "big challenge" when he started his firm. In the beginning, he had "no idea I was going to become deeply entrenched in the understanding of marketing, the psychology of that. I got to a plateau because I didn't have a strategic marketing approach. I'm an accountant; I have to learn and understand how marketing works."

That he did, he shared: "I stepped up and leaned into it pretty heavily. It was not as scary as I thought it was going to be. It was a true marketing strategy, instead of waiting for the phone to ring."

And for accountants that bristle at the idea of selling, Opsahl Dawson MP Dawson recommended reframing "selling" as "serving."

"Instead of a nervous phone call selling to a client, I'm going to serve them, and make the sales cycle easier. I'm preaching to the junior staff, after a finished tax return, call [the client] with a simple question: 'How's your year going?'"

Be careful of the M-word

It can seem like there's a ton of mergers going on in accounting these days, but actually, most of those combinations aren't mergers; they're large firms acquiring the assets and business of smaller firms — but they're called "mergers" for marketing purposes, and to assuage the egos of the acquired partners.

That's dangerous, Stan Sterna, vice president and risk consultant at insurer Aon, told Firm Growth Forum attendees. Plaintiffs can use of the word "merger" to try to create "successor liability," which pins responsibility for an acquired firms' earlier misdeeds on its acquirer.

He noted a number of other liability magnets:

Not have enough or adequately trained and credentialed staff on an engagement;
Skimping on due diligence in M&A;
Poor client vetting; and,
Weak or nonexistent quality control policies and training.

Money talks

The younger generation is more open about topics previous generations might consider verboten — including money. "Gen Z talks about what they make," said Ruszczyk in her session about career sustainability. "It's not taboo anymore — but full transparency now."

To satisfy this shift, some firms are offering their staff more visibility. Randy Crabtree, partner at Schaumburg, Illinois-based Tri-Merit, outlined key leadership qualities during his session, including — along with intentionality, vulnerability and empathy — transparency. The firm's finances are presented during Tri-Merit's quarterly state-of-the-union meetings: "We share financial numbers with everyone," he explained. "The culture is essential for firm growth."

Of course, in today's talent-driven environment, talk can be cheap. "Firms are increasingly advocating for implementing fair pay policies," said Ruszczyk. According to Accounting MOVE Project data:

76% of firms offer communication tools to support individual pay discussions;
32% analyze pay by race and gender; and,
4% tie equitable pay decisions to manager's base pay or bonuses.

Avoid the ‘disparate mess’

Getting information to and from clients has always been difficult, and too many accountants make it more difficult by saying they're going digital, and then allowing clients to backslide.

"I see too many firms with a disparate mess," said Steve Lyon, product marketing lead at SafeSend, by which he means a document collection process that's a confusing, erratic mess of paper and digital that introduces friction and sends mixed messages to clients and staff.

Better to stick entirely with paper, he said — or to fix on a single digital process that you can enforce and guide clients through.

Go beyond table stakes

The accounting profession is now well aware that a flexible work culture should be the baseline expectation, Ruszczyk said. But she urged firm leaders to have conversations with their people to ascertain what they require on top of that minimum expectancy.

Those dialogues might require more listening than speaking, however, as Ruszczyk mentioned a refrain she often hears from the older generation: "Listen, I came up this way, suffered, worked hours I didn't want to…. Therefore the younger generation coming up should have to suffer just like I did. And I turned out OK."

Ruszczyk took umbrage with that rationale, eliciting audience laughter: "If you want the next generation to suffer, maybe you didn't turn out completely OK."

Relationships trump transactions

For all the talk of artificial intelligence during the Firm Growth Forum — and, naturally, there was quite a bit — the conference's speakers were optimistic that it, and other emerging technology, would not widely phase out jobs. That is, as long as accountants remained true to the profession's identity as relationship-driven.

"So much of the culture is transactional," said Randy Johnston, executive vice president at K2 Enterprises, when addressing these concerns during an "Ask the Experts" panel. "But I still think it's a relationship business."

The data supports this, said Johnston's fellow panelist, BDO Alliance USA executive director Michael Horwitz, explaining that firms that embrace relationship-building advisory services are thriving.

In his reading of Accounting Today's Top 100 Firms and Regional Leaders list, he noticed as the percentage of advisory services a firm offers drops, so does their revenue and position on the list. "You're seeing your future in the evolution of larger firms providing more advisory-based services," he told the crowd. "High-value, noncommoditized, advisory services for clients are absolutely needed to survive and thrive … Think about this as contemplating your own futures. How are you going to grow this nontraditional portion of your revenue stream, because those highly valued services are what your clients are hoping and expecting you to deliver to them."

Sell transformations, not hours

As expectations shift from compliance to advisory-based services, so too should pricing models, explained VeraSage Institute founder Ron Baker in his session about subscription models.

"A professional is responsible for achieving a result, rather than performing a task," he said. "Services are a means to an end — we shouldn't be focusing on that. We need to start focusing on transformations, and we are one of a few professions that can do it."