Meet Hal. Hal was a 54-year-old CPA who ate and drank a little too much and didn't get to the gym as often as he should. He smoked about a pack of cigarettes a day, and conceded, "I'm not in the best shape, but hey! how demanding is an audit, really?" (And, Hal would add, his wife's a great cook.)
Every year at his annual checkup, Hal's doctor reminded him that he needed to lose a few pounds. And every year, Hal brushed him off.
Then one Monday morning, after Hal finished shaving, he dropped to his knees on the bathroom floor clutching his chest.
Hal was having a heart attack.
His wife called 911 and an ambulance rushed him to the hospital. Within an hour of his arrival in the emergency room, a team of surgeons was hunched over Hal, performing a triple bypass.
When Hal woke up, his wife and three children were at his bedside, looking bleary-eyed but relieved.
That did it. Seeing his family's deep concern and love for him, Hal decided on the spot that he was going to start taking better care of himself. With the help of his doctor and his wife, he stopped smoking, started eating right, and began going to the gym.
Hal was a model patient.
For about a year.
Eventually, unhealthy habits began sneaking back into Hal's life. More red meat. Fewer trips to the gym. A couple of cigarettes at night.
Hal is not unusual. In fact, according to Dr. Edward Miller, dean of the medical school and CEO of Johns Hopkins University: "If you look at people after coronary-artery bypass grafting, two years later, 90 percent of them have not changed their lifestyle."
ACCOUNTING'S HEART ATTACK
The Great Recession was to public accounting what Hal's heart attack was to him: a huge wake-up call. Like Hal, many firms weren't behaving in the most healthy, sustainable ways. Then, when the recession hit, firms had to drastically change their behaviors. I saw three approaches:
1. Firms played defense by laying off staff, taking markdowns on fees, and cutting overhead costs.
2. Firms went on the offensive, creating intense marketing and business development schemes.
3. Firms used a hybrid approach, playing offense and defense simultaneously - for instance, agreeing to a smaller fee from a key client in exchange for a binding multi-year commitment.
The results have been real. Firms that took the Great Recession seriously and made the changes required to survive are not only still in business - many are running more profitably than they ever have.
The big-dollar question is: Will the changes stick?
It depends on three questions, all centered around your people. As John Kotter, a Harvard Business School professor who studies organizations in the midst of upheaval, says, "The central issue is never strategy, structure, culture or systems. The core of the matter is always about changing the behavior of people."
THREE QUESTIONS FOR YOUR FIRM
To determine whether your firm will be able to maintain better business habits, ask yourself these three questions:
1. How do we frame the firm's future? Framing is a critical concept. When we "frame" an issue in a certain way, we give it context and assign importance to it.
For example, if your firm "framed" its layoffs and aggressive business development goals as a reaction to the Great Recession, the implication is that after the recession, measures like this will evaporate.
On the other hand, if your firm frames its future around a stretch goal like becoming a top 20 firm, then aggressive business development goals and proactively managing underperformers will be assumed to be longer lasting.
Howard Gardner, a cognitive scientist and professor at Harvard's Graduate School of Education, offers this advice to leaders who are trying to frame an issue for their firm: "The story must be simple, easy to identify with, emotionally resonant, and evocative of positive experiences." Think of that next time you're getting ready to present a major change initiative at your firm.
2. Are people's hearts in it? Accounting may be the language of business, but emotion is the language of change. If you're not appealing to the heads and hearts of your people, you'll never get them onboard. Think back to Hal: None of his doctor's annual bullying worked. It wasn't until Hal saw the worry on his family's faces that he committed to make healthy changes.
Professor Kotter's research on people's attitudes towards change reveals that all the scorecards in the world won't change anyone's behaviors unless you appeal to their emotions as well. How can you appeal to your team's sense of pride, competition or will to win, as you frame your firm's future?
3. Do you have the infrastructure in place to support your vision? Anyone who's ever maintained significant weight loss for 10 years or more will tell you that achieving the weight loss was the easy part. The hard part is keeping it off, month after month and year after year. To do so, you have to retrain yourself and (sometimes) restructure your surroundings.
In firms, long-term change requires similar retraining and restructuring. You may have to hire a few new people with different skill sets, rewrite your partner agreements and eliminate underperforming partners.
Change is not easy. That's why so many people - and firms - fail in their efforts to make lasting change. Even when it's a matter of life and death.
Rebecca Ryan is a consultant and regular Accounting Tomorrow contributor who helps firms attract, develop and keep their top talent. Reach her at rr@nextgenerationconsulting.com or (888) 922-9596 ext. 702.
