Boomer’s Blueprint

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IMGCAP(1)]There are many projects that any firm, regardless of size, can implement that, if successfully executed, can create significant performance improvements and reduce the risk of missed opportunities.

Most projects are pursued based upon generating new revenue and new opportunities, but too often they turn into maintenance of existing systems and processes. Little innovation, if any, results due to the gravity of existing processes. The way to avoid the gravity of the past winning out over innovation and improved performance is to spend more time in planning and evaluating priorities. Too often, a siloed approach is used, rather than a firm approach.

The following projects will improve the success, focus and return on investment in planning, people, processes and technology.

Project 1: Focus on projects that support the firm’s vision. Regardless of firm size, your first project should be to review the firm’s vision and growth plans. Once there is consensus on the vision, you must ensure that all projects support the vision. Innovation and growth projects should be given priority over maintenance. Maintenance is a given and will not be enough to compete going forward. With any project, you need a champion. The champion can be part-time or full-time depending upon the initiative, and should have project management skills, as well as the communication skills needed to gain support and momentum.

Project 2: Re-assess end user and client needs. This project sounds relatively easy, but is extremely difficult due to the fact that you must be able to interpret what the end users are really saying. Often they do not know what is possible or what leading peers are doing. Some will be extremely happy as long as things do not change for them. Some know that change needs to occur, but prefer to wait. Others will be ready to embrace any project that improves processes. The challenge is to avoid the temptation to get caught in the HPPO Syndrome (Highest Paid Person’s Opinion). Again, communication is extremely important.

Client needs and wants are generally easier to determine due to the fact that you are the outsider. According to Kurt Gödel’s law on perspective, to understand the system you are in, you have to get outside of it.

Project 3: Take on business process improvement in your core services. A process is an organized group of related activities that together create value to clients. Every firm has processes, but are the processes as efficient as they should be? More important, have they been modified over the years to reflect the changes in technology and client demands? Some of the more inefficient processes in firms are the preparation and delivery of 1040s, preparation and delivery of business tax returns, auditing and financial statement preparation, and time entry, billing and collection.

Pick your priority process and start a Lean Six Sigma process improvement project. You will be surprised to learn you have: steps that are redundant and add no value; loops; and cycle times that are too long. Technology is automating many of these processes, resulting in improved performance, increased profits, and improved cash flow.

Project 4: Revisit your technology platform and ecosystem. One question I always ask is, “What would your firm do differently if it was 10x in revenues?” The second question is, “What would you do differently if the firm were 10x in revenues?” The correct answer is you need to think as if you are 10x. Most thinking about technology in accounting firms has been focused on the end product — a tax return or financial statement. The thinking needs to change and focus on how to capture the transaction as early as possible and flow through the system all the way to the tax return and financial statements.

Much of the technology focus has been on the cloud in recent years. I am a supporter of the cloud for numerous reasons (security, improved integration, cost and real-time capabilities), but in reality many of the core applications from leading vendors are not true cloud-based applications and require desktop resources. On the other side, many accounting applications are now in the cloud and integrate well with payroll, bill payment, and financial reporting and analytics.

Most accounting firms are currently required to manage hybrid ecosystems. We often refer to this as the fog, rather than the cloud. Over time, most applications will move to the cloud for the previously mentioned advantages.

Project 5: Join a community of peers. Peer communities, especially those that focus on bridging the gap between management and technology, can pay huge dividends. The key is having multiple people at the table. Just putting special interest groups together results in identification of the problems, but often does not develop the roadmap or required budget. Ask leading firms of all sizes about the value of peer communities. The advantages of peer networking are extensive, ranging from increased confidence to shared resources to access to expertise and vendor access at a higher level.

Project 6: Build your team; re-deploy human resources. This is probably the greatest challenge for firms, but can be the most rewarding when you get the right people in the right seats on the bus. The greatest growth in accounting firms is coming from advisory services. These services require a team with different skills than a focus on just compliance services. Some of the more important skills are leadership, industry expertise, technology, project management and human resources/talent development. The largest firms are hiring many non-CPAs on these advisory teams. In the 1700s, Adam Smith stated, “All increases in wealth come from the division of labor.” Managing talent and ensuring the engagement of employees is critical for future success and readiness.

The first step is often knowing your own unique abilities and then building the required team. Too often firms tend to hire a “Mini-Me,” rather than a team with diverse skills and backgrounds. Partners and staff who focus on their unique abilities are more productive and avoid burnout. Often firms have the right people, they just have them in the wrong seats. There are many training programs and tools to assist firms with their talent management.

L. Gary Boomer, CPA.CITP, CGMA, Macc, is CEO, senior consultant and shareholder at Boomer Consulting Inc.

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