Still just talking about change?

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In his book, "The 12 Rules for Life: An Antidote to Chaos," clinical psychiatrist Jordan Peterson explains why fear is such a powerful motivator. He describes one famous experiment in which a hungry rat has a spring tied to its tail and pulls as hard as possible to get to the cheese on the other side of the maze. The rat's pulling strength is impressive, but that's nothing compared to the energy it expends when cat odor is sprayed around in the maze. According to researchers, rats pull twice as hard to escape an (imaginary) threat than they do to get a tangible reward.

What do rat experiments have to do with accounting? I bring up this experiment because sometimes it takes a crisis — or at least a healthy dose of fear — to prompt us to take action. This is the time of year when many of us have brainstorming sessions and offsite retreats with our teams. We discuss all the changes we'd like to implement to improve our client's experience and team's life. But inevitably, something gets in the way of those bold plans, and helpful changes never get made.

The problem with "kicking the can down the road" every year is that you're falling behind all your peers and rivals who are finding ways to make those positive changes for clients and their teams.

Maybe they've had a cat in their cage, or at least they've contemplated a future in which they've fallen behind the marketplace. They've taken a good hard look at what failure looks like after a significant loss of business. It's not pretty.

There's a principle of behavioral finance that says investors feel the pain of a loss 10 times more acutely than they feel the joy of a gain. The same goes for gambling — and for professional services. Don't believe me? Think about how your team members feel when they see their professional peers freed up to do more interesting work because their firm's leaders implemented positive changes — the changes your firm keeps talking about but never acts upon.

Consider how your clients feel when they keep hearing about Wow! experiences their friends are having with their CPA — and they can't top the story with your services. 

Consider what happens if you never get around to rightsizing your client base. You keep serving clients that aren't a good fit for your business, and worse, they keep referring more clients to you that aren't a good fit. These clients don't appreciate your work, they wear out your team, and they keep asking you to lower your fees. Now you have even more problem clients on your roster and more time bombs to deal with during tax time. 

Now a vicious cycle begins. Your smallest clients keep eating up more and more of your time, while your largest clients feel neglected. It doesn't matter if you know you must provide a better experience for your best clients. It only matters if you do it. That's called closing the "Knowing-Doing Gap."

You know your clients probably want more from you, but you can't help them because your time keeps getting eaten up with minutiae that get in the way. How long can you keep delaying before the flywheel keeping your business humming along turns into a doom loop? Read on for more about positive flywheel and negative doom loop.

It doesn't matter how much you appreciate your clients if you never make a point of telling them and you never show them by giving them the services they expect. (For more, see my recent column, Three words can make all the difference for your clients.) Don't mistake client silence for client satisfaction. Dissatisfied clients usually leave without warning when they find a better offer from another firm. If that's the case, put the cat in your cage and let fear be your motivator. 

Sit down with your people and decide what kind of firm you want yours to be. Start with your squishy work-from-home policy, for instance, since that's a hot-button issue today. You can't have a different work-from-home policy for every team member. It's got to be consistent. We've all heard stories of firms that put remote work policies in place and then walk them back before introducing a new work-from-home policy that ends up upsetting more people. 

Your work-from-home policy must be clear, consistent and written for everyone to see. It's a bigger deal than you might think. It determines your training and your onboarding process for new clients. Larger firms are more likely to have formalized their work-from-home policies. They know what the stakes are. But midsized and smaller firms seem content to keep kicking the can down the road. 

Just like other changes we've discussed in this article, where your people are allowed to work drives much of your firm's culture. You need to make your policy clear. Sure, you can keep procrastinating on that, but fast forward three years and what do you have? A hot mess. You have some managers following one set of rules and other teams following a different set of rules. No one's happy and people are quitting because everybody feels like somebody else is cheating. 

No one ever said change was easy. But the downside of inertia long-term is a lot harder to swallow than the short-term pain of shifting gears. Invite the cat in for a visit, but don't let it stay. You're too smart for that.

I'd love to hear how you and your colleagues are adapting to the new landscape of the modern CPA firm.