Boomer’s Blueprint

Mindset determines IT success

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Without the right mindset, it is impossible for firms to develop a technology platform for today and into the future. I have always been a proponent of managing technology as a strategic asset rather than overhead, but in today’s business transformation, firms must think differently to sustain success and be future-ready.

The technology requirements for a CPA firm have always been demanding. It is not unusual for midsized and larger firms to have over 100 applications on their servers or in the cloud. Many of these applications contain redundant data that must be reconciled and managed. Many of the core applications like tax return preparation and audit workpapers do not integrate or play nicely in the cloud. Perhaps CPA firms are not as unique as some once thought when it comes to technology requirements. Their selection processes and motivation may differ.

Firms are similar to their clients in that automation is taking place in all areas of a business. What is the technology platform for the future and what mindsets do firms need to survive and become future-ready? Our consultants get asked these questions daily. The answer involves asking more questions:

  • What is your vision? We utilize a vision-casting board to capture what you want to be, do, have, create and experience over the next three to five years. This becomes the foundation of the strategic plan.
  • Do you have a strategic plan? The answers vary from, “We are working on it,” to “Yes, but it is outdated,” to “No.” Firms should quickly develop a one-page strategic plan that builds consensus, establishes priorities, assigns responsible parties, and includes due dates. It is a valuable communication and recruiting tool that firms should update annually and measure progress for accountability.
  • Do you have an IT roadmap? The IT roadmap is a dynamic one-page plan that is integrated with your vision and strategic plan.
  • Who is responsible and accountable? As a firm, “who” is more important than “how” or “when.” While all are important, “who” determines the allocation of resources and assigns accountability. Accountability is the fastest way to produce improved results. You may not have this person currently employed, or they may be leading another area of the firm. Expecting them to do both is generally not a good strategy, but it is a trap in which many firms find themselves.

Once these basic questions have been answered, you can build the platform, tech stack or technology ecosystem for today and the future. This is not easy and one of the primary reasons firms struggle with technology, service offerings, talent, outdated processes and lack of organic growth. Some may say this is simply change, but it is really transformation requiring different mindsets, skill sets and toolsets. That the speed of change will only increase is a given, so firms must have the capability and capacity to deal with it.

Success with technology is determined by mindset and skill sets. Mindsets and skill sets in your firm are generally determined by experiences, and people are generally comfortable with their current processes and technology, even if those are inefficient and ineffective. We refer to this as technical debt, where firms have failed to remain current with technology and skill sets. The debt must be paid off through increased investments in IT and training. This becomes a difficult decision for firms, as it impacts partner income. Investments in continuous improvement and maintaining partner income require balance, vision, discipline and great leadership. The table below shows 10 areas or factors that will determine behaviors. I have taken the liberty to outline the characteristics of the “who” responsible for timely execution.


Factor Who is responsible?
Governance, agreements and core values CEO, COO and legal counsel
Compensation — focus on vision and strategic plan CEO and/or compensation committee
Talent development — diversified unique-ability teams HR and/or training/learning coordinator
Process improvement — ongoing and leverages technology COO, service line leaders and/or Lean Six Sigma Green or Black Belts
Technology — focus on the business capability model CIO or IT director, the technology committee, and/or service line leaders
Deferred compensation — multiple and sustainable cash flow CEO, COO and executive committee
Niche markets — service lines and specialties Executive committee, market champions and/or service line leaders
Marketing and sales CMO or business development leader
Innovation Chief innovation officer
Peer associations and memberships CEO and firm leaders

These key areas determine culture, value and the timeline. Project managers, business developers, human resources and talent developers need different technology tools than accountants doing compliance work. Don’t attempt to adapt or bolt on to old technology. You must move to the cloud to transform your firm. Most firms are currently being forced to run in a “hybrid environment” by incumbent vendors who have not upgraded to the cloud (tax and accounting).

Too much of your IT budget is probably spent maintaining old technology, rather than focusing on new and innovative services and delivery. New personal computers with faster processors are not innovation. Innovation occurs when you combine hindsight, insight and foresight. Changes in service lines, processes, and improved client service can be innovative. But don’t ignore your business model. Is it relevant and sustainable?

This brings us to one of the biggest questions and transformative mindset changes that must occur in the accounting profession. What business model should we use? Most will agree that the effort economy (hours times dollars) has passed and we are in a results economy. Technology continues to disrupt the old model and firms can no longer avoid the impact upon their service lines and pricing. Therefore, I think it is imperative for firms to implement subscription pricing as they package and price multiple services to clients.

The 10X model is appropriate in the accounting profession. What can we do that will increase our value 10 times to the top 20 percent of our clients? This normally results in additional services and increased billings from advisory and consulting services. This exercise also discloses mindset gaps that must change to advance. Some of those mindset gaps are listed below:

  • All clients are good clients. The clients that got you to this level may not be the clients that will get you to the next level. You must give up something to transform. Start with eliminating the bottom 5 percent of clients.
  • All service lines are profitable. An old farm adage applies: What should you sow, grow, harvest and plow? Generally, the hardest thing for any firm or business to do is plow.
  • Work is where you go. Work is what you do, and it can be done anywhere at any time. Don’t limit your capabilities and capacity with old thinking.
  • You must be a CPA to contribute value. Diversity and inclusion not only expand perceptions; they also expand service opportunities and markets. CPAs should think of themselves as leaders and valuable contributors to unique ability service teams, not as rugged individuals. Growth in most firms is coming from advisory and consulting services where data analytics, marketing, sales, workflow and project management add value. Remember that value is added through leadership (direction), relationships (confidence) and creativity (new capabilities).

Changing mindsets is not easy, but is necessary to sustain prosperity. The alternative of staying the same is higher risk. Be bold. Think — plan — grow!

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Strategic planning Strategic plans Technology