Most firms are looking to grow, yet many have trouble taking advantage of the higher-value consulting opportunities. Why? Every firm is different, yet there seem to be several common obstacles to providing higher-value services.

Here are some of the more common obstacles that I hear from partners and staff on a global basis.

1. Time: We don't have the time to take advantage of these opportunities, as we are too busy doing compliance work.

2. Pricing: We have always priced by the hour, and consulting is different. Fixed-fee engagements seem risky.

3. Technology platform: Our technology is inefficient due to the fact that we do not have a common platform and database. Our existing tools are labor-intensive and prone to error.

4. Talent: Our staff have been trained that value comes from charge hours. Compliance personnel typically find consulting difficult and may not make successful consultants. They focus on charge hours, rather than opportunities. Consulting is a team sport and requires multiple skills to meet the needs and wants of the client.

5. Independence: We were taught to be independent, and most consulting requires advocacy.

6. Value: All services are more valuable when packaged. This includes traditional transaction services as well as CFO and planning services, yet most firms price and bill these services separately.

7. Timing: Many of these services need to be completed on a monthly basis, and we are understaffed during busy season.

8. Delegate: Consulting services do not have to be completed by the person selling the services if you have a team approach.

9. Collection of fees: A portion of the fee should be collected in advance, and then monthly payments can spread the cash flow over the entire year, especially on recurring services. Don't be afraid to talk about scope, terms and expectations in advance.

10. Processes: Many firms lack a consulting methodology and lack the confidence to get started. It is easier to continue to do what we have been doing, even if the margins are shrinking.

These 10 challenges are real, yet many firms are developing strategies to overcome the obstacles and attain their growth goals. What are the characteristics and strategies utilized by successful firms? Basically, there are three ways to create value, and in most cases two or more of the three criteria are present. The first is leadership. Leadership provides direction. Without a leader or champion, most firms will fail. Second, relationships add value through confidence, and third, creativity provides new capabilities and opportunities. The key is to balance your capabilities with your opportunities.

There are multiple ways to grow, from expanding service lines to mergers and acquisitions. While these are both viable strategies, it is often easy to overlook opportunities associated with existing services and clients. Tax planning and compliance is a great example, and an area in which almost all firms currently provide services. Yet due to the increasing complexity of ever-changing legislation at the federal and state levels, plus the importance of international tax, I believe that firms often discount the opportunities. Granted, there is a high degree of complexity, and some firms may not have the internal resources or a large enough client base to justify acquiring the capabilities required to offer some of the more sophisticated services related to tax credits (jobs, energy, enterprise zones, etc.) as well as cost segregation.

There is a simple management strategy that is often overlooked when it comes to complexity, and many accounting firms get caught in the trap. In order to break through the ceiling of complexity, you must first step back and simplify the approach. The purpose of this article is to demonstrate a proven process of simplification, and to allow CPAs and firms to think differently about matching opportunities with capabilities. By thinking differently, you will probably challenge some of the existing strategies and perhaps even some of the processes that have made you successful. The old saying that what got you to this level of success won't get you to the next level is often true when dealing with increased complexity.

We are talking about the development or access to the required capabilities necessary to leverage current and future opportunities. If you don't have those capabilities or access to them, your firm will miss opportunities. If you do have the capabilities, but not the opportunities, you will generally underperform and have trouble retaining and attracting quality talent due to the lack of growth opportunities. Internal discussions can often evolve into chicken-or-egg arguments.

Let's take one step back from what most firms are doing today and assess how to develop talent and capabilities based upon today's opportunities. Most firms think in terms of internal resources, especially larger firms, but this may not make the most sense economically. Think big: You can leverage this opportunity with little or no additional investment in labor or technology!

In our profession, talent provides capabilities and the market provides the opportunities. Talent is developed primarily with three key components:

1. Self-motivation and life-long learning;

2. Access to experts and experience; and,

3. Relationships with peers.

This approach may be different from the rugged individualist approach that many seasoned accounting professionals are accustomed to. Today, the complexity and breadth of knowledge requires a team approach in order to scale.

Here are some basic questions that CPAs and firms should ask when evaluating new or expanded services:

1. Will this service provide value to the client?

2. Who is going to champion this service?

3. Does the champion have the passion, time, team and budget to be successful?

4. Does the firm have the necessary capabilities, or should we source with an external expert(s)?

5. Does the firm know how to name, package, brand and price this service?

6. Is there a community of peers that we can join in order to accelerate our ability to balance capabilities with opportunities?

From extensive experience, I can say the CPAs and firms that get the most value from communities of peers are those who contribute and provide confidence to their peers. Learning is a two-way street. You must be vulnerable to learn and willing to teach. The communities raise the level of success for all participants. Also, having access to expertise outside of their firm provides great value, even for internal experts. The exchange among expert peers results in learning, increased confidence and improved clarity. This expertise ranges from technical tax and accounting knowledge to:

  • Technology;
  • Marketing and sales; and,
  • The HR and team building/management.

In the end, it is about you: You have to be motivated and have passion to succeed. Participation in a community provides you with access to experts, and your peer relationships accelerate the process and increase the probability of success.
Those with passion succeed, while those without passion merely try.

Gary Boomer, CPA, is the president of Boomer Consulting, in Manhattan, Kan.

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