Nearly every accountant I've ever met refers to themselves as a trusted business advisor. However, when asked what makes them a trusted business advisor, most of their answers better fit the description of trusted accounting technician, acting more like a scorekeeper than coach.

The path from trusted accounting technician to trusted business advisor is a value-adding journey that extends beyond a compliance-oriented relationship to one of reliance, where clients "rely" on their accountant to help them make better business decisions.

For accounting technicians to become trusted business advisors, they must move up the value chain from:

  • Being a scorekeeper delivering hindsight,
  • To providing technology-enabled, real-time oversight,
  • So they can deliver value-added coaching insight,
  • As well as mission-critical foresight that clients can rely upon.


1. Hindsight. This is the act of reporting on past outcomes. It's difficult to add value at this level. It's also very difficult to compete with other firms, not to mention the DIY accounting programs that are flooding the market.

2. Oversight. This is the business of reviewing your client's financial information with an eye toward addressing issues before they become problems. Operating in the cloud will soon be ubiquitous and an assumed competency. However, those firms that utilize cloud and mobile technology not just as an information transfer utility, but as a means of getting closer to their clients and to keep an eye on day-to-day outcomes, are starting to move into the realm of trusted business advisor.

3. Insight. This is the art of helping clients fully comprehend the implications of what appears on their financial statements. We refer to this as "Financial Fluency" in support of growing our clients' business acumen. Teach them to understand and strategically respond to what's happening.

4. Foresight. This is the science of breaking down company goals and strategies into key performance indicators -- with the operative word being "indicator." Trusted business advisors are focused on improving the quality of information for decision-makers. They do this by identifying the 20 percent of activities that are driving 80 percent of outcomes.

Firms need to adopt specific advisory protocols that support each of these value-adding levels. For example:

  • A Hindsight action step would include organizing the chart of accounts so a client can access more relevant performance feedback by department, service, or product line.
  • An Oversight action step might include setting alerts/triggers when key margins go outside of desired perimeters.
  • An Insight action step might include regular "Financial Fluency" training sessions for clients and their key managers.
  • A Foresight action step would include the development of five to seven key performance indicators that provide strategically relevant feedback about mission-critical activities.


Advisory services are not the same as reporting on what has already happened. They must include deeper insights and relevant perspectives that support the overall objectives of an organization. And to make sure every client benefits from, and every team member can provide, advisory services, firms must have standardized protocols to avoid falling into the unleveraged trap of "random acts of consulting."

Here are a couple of scenarios:

Scenario 1: A clients asks for help with a business problem that doesn't quite fit with traditional tax and accounting service offerings. You say, "Of course, we can help you with that." Then the panic sets in as you head back to the office to figure out your next steps, and before you know it, you are watching your realization rate drop off a cliff.

Scenario 2: Perhaps you have a consulting savant in your firm - one of those accountants with the ability to create unique deliverables when a client presents the need. The good news is that the client with the need is taken care of. The bad news is that one-off engagements are difficult both to leverage to other clients and to teach others in the firm.

In both of these scenarios, you end up with random acts of consulting: a service that is typically a one-off, designed-on-the-fly deliverable.



My doctor sees dozens of patients each day. She has a standard diagnostic process she follows before reaching any conclusions. If a diagnosis is not readily apparent after listening to a patient's heart, lungs, checking their eyes, ears, nose, throat, reflexes, etc., she orders more tests. Although she may have a hunch, she is looking for independent confirmation.

Advisory services should be approached in the same manner. Otherwise, those random acts of consulting often lead to isolated solutions that may address the symptoms but don't necessarily address the underlying cause or, in some cases, fixes in one area of the business may have unintended consequences in others.

Each firm needs a standardized diagnostic intake, as well as standardized treatment protocols (with room for customization). On those rare occasions when client needs fall outside of the normal scope of services, then it's time to call in the consulting savants.

For firms seeking to make the transition from compliance-based services to reliance-based or advisory-type services, the race is definitely on to identify and implement the right systems and technology to make that happen. However, before you step outside your core competencies to adopt a new set of skills, you should consider how you can bridge what you are already good at with what your clients really want.

Simply put, accountants are good at accounting for things. Traditionally, accountants have been focused on measuring the financial activities of the business. However, we know that when accountants apply those skills toward measuring other types of activities in the business, two things happen:

1. The client has better information to run their business with and, in doing so, is better prepared to attain their desired goals; and,

2. The client's perception of their accountant shifts from strictly a scorekeeper to more of a coach, thereby creating a higher perception of value and fees accordingly.

Instead of just providing your clients with financial statements, or what we call "lagging indicators," there is an opportunity to expand your efforts to include providing "leading indicators." These leading indicators provide your client with real-time feedback about their company's performance so that they can make adjustments to their strategy on a real-time basis.

The concept of measuring activities is pretty easy to embrace. Being able to identify the activities critical to the company's goals takes some practice. Start off by measuring just a handful of critical numbers, such as lifetime value of a customer, customer cost of acquisition, cost of errors/re-work, conversion rates, marginal net worth, etc.

Here are six steps to follow when setting up this type of advisory engagement.

  • 1. Establish a baseline of financial and performance indicators relating to the current business scenario.
  • 2. Set goals for future growth -- break down specific goals for each business unit based on company goals and industry benchmarks.
  • 3. Identify the key performance indicators to be measured -- look at them from a customer-focused and operational perspective.
  • 4. Educate the team about the link between their performance and the financial outcomes of the business
  • 5. Design a "report and reward" system that reports on, recognizes and rewards the contributions of each business unit and team member towards the accomplishment of company goals.
  • 6. Measure, monitor, and meet with key management personnel on a regular basis, to review and advise on ways to improve critical numbers.

Making the transition from scorekeeper to coach means moving beyond the traditional compliance-focused services to apply your accounting skills to all areas of business performance. The key to expanding your accounting firm is to expand what you're "accounting" for.
Edi Osborne, CSPM, is the chief executive officer of Mentor Plus, and co-founder of the Mentor Plus Consulting Accountants Round Table, author of the Mentor Plus M.B.A. -- More Business Acumen Program and Certification in Strategic Performance Management and, most recently, of Firm Forward: A Journey From the Land of Compliance to a World of Reliance.

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