How to build the team that will replace you

Register now

We hear a lot in the news about the accounting firm of the future, but what really hits home is your accounting firm of the future. So many CPA partners and owners would like to see their firms remain independent and become a potential home for others.

To secure the future succession — and success — of your firm, it’s important to start with what kind of team you must create, and learn how best to retain those players that may ultimately replace you. Each firm will have different needs, but the guidelines for this kind of continuity plan break down into two categories: composition and development.

Team composition

No continuity plan will succeed without having talented accountants and business advisors, so skills and high quality are must-have characteristics. The team should include people from all walks of life, with diverse backgrounds and experiences.

Each must be committed to personal growth in and out of the office. Some of the roles may be outsourced, yet the same criteria apply. Because of different work-life balance priorities, it may require two people to replace one. Also, a successor who is working their way up the ranks is likely to want a much more profitable practice with a smaller number of clients.

That said, there will need to be three types of team players:

  • Organizationalists are the people who focus on process, team-building, communications, internal priorities, overall accountability and service satisfaction. These people may have accounting skills, but more so must possess high management passion and very strong interpersonal awareness.
  • Technologists are the players who will drive the client deliverable and production cycle to its utmost efficiency by maximizing the deployment and access to technology. Of course, these people need to be technology mechanics who care for the hardware and software. But, even more progressively, they must be client service-centric — that is, engaged with client projects both for mainstream deliverables and special technology services.
  • Clientologists advise and advocate for the financial well-being of clients. They may not be CPAs but are financially and business management savvy. Their communication skills should be well developed and they should have the ability to anticipate client needs and behaviors. They may actually build some of the products the clients receive or may only deliver those services and interface with the clients. They should be deeply involved with business expansion and new client recruiting.

Team development

Internal team members identified in this kind of succession plan must receive a clear pathway to progress that will be well defined by skills, performance levels and firm goals. Support for their development may come from internal mentors, outside experts or a combination of the two.

  • Create a development plan: Go beyond a baseline job description or periodic firm performance goals to create a plan for each individual successor. Talk to the employee. Find out how they want their career to develop and make sure it fits into the long-term continuity plan envisioned by the firm and its leaders. Not everyone shares the same career goals. This development plan might include investments into training or outside career development resources. Mutual benefits for the employee and the firm should be highlighted.
  • Consider dual career paths: Advancement doesn't always mean moving from a lower to a higher position. A team member might want to switch roles. They still may want to become an owner of the firm, but in a different capacity. Job rotation may help. This kind of high-level map also offers an overview of the firm's workflows, and the flexibility may help them understand there is an option for them should they continue.
  • Incentive and reward: In addition to any periodic performance goals, team members being developed for succession should be offered other value enhancements to underscore their “buying into” the firm. Longevity bonuses could create an incentive to remain with the firm as well as enhanced pricing for equity based upon longevity. Rewards for achievement that are not just about business development need to be developed, especially for organizationalists and technologists.
  • Monitoring and metrics: Constantly monitor progress and schedule regular meetings to discuss how things are going. Don’t focus only on checking off progress boxes. Get feedback from the team member and adjust the plan as needed. Not including a system of monitoring and feedback tells the individual that their development is not important, which leads to a lack of motivation — or worse.

Perpetuating a good business succession plan is not easy, but it is well worth the effort. While many of the deliverables for the accounting profession are consistent over time, the players, processes and market conditions are constantly changing. To remain independent, you are likely going to need future owners who are CPAs and others who are not.

A change in your firm’s transition model will be necessary to remain independent and solidify your firm’s longevity. Those changes need to be built and put in place well before any anticipated notice of retirement. If the changes become too difficult, then an outside successor may be the best option. Either way, transition will still be a requirement for success.

For reprint and licensing requests for this article, click here.
Succession planning Practice management Practice structure Employee retention Career advancement