STRATEGY

Accounting Disruptors Are Heading Your Way … with Deep Pockets

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If you’re not ready to make your move, you’d better hope your competition isn’t.

By Jody Padar
The Radical CPA

Change isn’t just knocking at your door; it’s kicking it down. We’re in the middle of a major transformation because of new players, cutting-edge technologies and a financial surge. The rules are being rewritten before our very eyes.

MORE: The Convergence of Trends Makes Pricing Changes Imperative | Stop Looking for Talent that Does Not Exist | Advisory Work Must Be Priced by Value, Not Hours
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If you consider accounting a giant chessboard, many players are making strategic moves. You have the old-school firms on one side who are navigating a rapidly changing landscape. On the other side, you have the new-school disruptors. These innovative entities are reshaping the industry with cutting-edge technologies and fresh approaches.

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‘Great Shakeup’ in CPA Firms on the Way

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Those that continue to make deep and sustainable investments will excel; “grinders” will face serious challenges to staying relevant.

By Allan Koltin
The Rosenberg MAP Survey

EDITOR’S NOTE: Every year, the Rosenberg MAP Survey asks the industry’s top consultants to share their observations from CPA firms across the country. How do you think the next 12 months will unfold? Also, how would you assess the last 12 months?

As I look to the next 12 months (July 1, 2023, to June 30, 2024) I see the “hourglass” half full! I know we have been in and out of a recession and flattening economy for the past 3.5 years, but I believe that in 2024 the economy will be better and stronger (I know I may be a minority opinion here!).

MORE: AI for Accounting Automation Will Be Significant | Private Equity Leading to Corporate-style CPA Firms | PE, Consolidations to Keep Impacting Accounting Profession | A 40-Hour Workweek Is Feasible | Five Ways Staff Shortages Are Changing Firms Forever | Soft Skills Are Front and Center | It’s Time for a New Business Model | Rosenberg MAP: Partner Incomes Surge 11.4%
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Whether I’m right or wrong may not matter though, as CPA firms continue to have strong performance in good and bad times. I realize that in a recession, the use of certain advisory and consulting services may be reduced or put on hold, but that aside, I think 2024 will be a strong year for firms as they continue to right-size and reimagine what their firm can be.
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PE, Consolidations to Keep Impacting Accounting Profession

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Cash infusions make the recruiting environment more competitive.

By Angie Grissom
The Rosenberg MAP Survey

EDITOR’S NOTE: Every year, the Rosenberg MAP Survey asks the industry’s top consultants to share their observations from CPA firms across the country. How do you think the next 12 months will unfold? Also, how would you assess the last 12 months?

I believe competition will continue to increase and firm leaders will continue to make changes regarding business structure. Leaders will continue to innovate their strategies to meet the market demands. Private equity infusions and consolidations will continue at a steady pace, as structures will evolve to align with each individual firm’s leadership goals.

MORE: A 40-Hour Workweek Is Feasible | Five Ways Staff Shortages Are Changing Firms Forever | Soft Skills Are Front and Center | It’s Time for a New Business Model | Rosenberg MAP: Partner Incomes Surge 11.4%
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Firms will continue to place priority on building advisory practices and streamlining operations to increase efficiency and communication. Firm governance structure, clear goals and increased transparency and accountability will be required to remain competitive.
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Fifteen Big Questions for Your Next Strategy Session

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six people meeting around a table

Focus everyone on the big issues.

By Marc Rosenberg
The Rosenberg Practice Management Library

Most firms spend their time at retreats planning for the future, forming goals and addressing pressing issues and problem areas. The problem areas aren’t day-to-day issues such as purchasing a new copy machine or revising the policy on sick days. The problem areas are more strategic: morale issues, recruiting problems, profitability, etc.

MORE: Five Steps to Transition to Partnership | Disturb the Present to Improve the Future
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Here are some specific examples:
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Four Considerations for Effective Client Culling

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2023: The year “cull” was no longer a four-letter word for CPA firms.

By Bill Penczak

It finally happened.

For at least the past dozen years, I’ve heard CPA firm partners’ bold talk about culling their clients in order to ease staffing issues, focus on larger, more profitable engagements, or rid the firm of the PITA clients, which has nothing to do with animal rights and more about protecting their people from those who are a Pain ____  _____  _____ (complete the next three words on your own, and you can skip Wordle for today).

MORE: Partner Accountability: The Only Two Things That Really Matter | How to Boost Profits by (OMG) Sharing the Upside | Dustin Verity: Keep an Open Mind and Constantly Learn | Secret to Success? A Growth and Abundance Mindset | The Six Essential KPIs for Managing Partners | Your Marketing Sucks: Six Reasons Why | Nine Smooth Moves to Build Client Satisfaction
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A recent study was published that indicated only 1 percent of CPA firms could adequately staff their engagements. And while more firms are migrating to offshore models to get work done, more are actually culling clients, but without a measured process for doing so.  

Here are some suggestions for successful extrication of clients who are wearing down the profitability and the morale of firms: 

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Keep Clients from “Balance Due” Shock

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With just a little advanced marketing, you can get paid year-round AND have more satisfied clients.

By Frank Stitely
The Relentless CPA

When I talk with prospective clients in any medium, I lead with tax planning. I don’t care if I’m meeting them, calling them or emailing them. I lead with tax planning. The number one complaint clients have about CPAs and tax preparers is a lack of planning. They get tax returns and nothing else.

MORE: Stop Clients from Performing “Favors” | Who Needs Fall Tax Planning? Clients … and You | Get Clients to Bring Tax Docs Early…Yes, EARLY | Why Time Tracking Still Matters | Make Fewer Mistakes, Increase Revenue and Capacity | Six Ways to Create a Millennial-Friendly Firm
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The fun part is seeing the reaction when I mention planning. I tell them that they can know the results while there’s still time to change the results. Tax season is no longer stressful because they know the answers in advance about refunds and balances due.
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Would You Buy Your Own Services?

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Don’t expect potential clients to if you don’t know what sets you apart.

By Steven E. Sacks, CPA, CGMA, ABC

Do you ever wonder why after spending many hours on drafting, editing, proofing, and polishing—and proofing and polishing just once more—your engagement proposal efforts did not result in winning the engagement? And if this happens on a semi-regular basis, the frustration is never easier to take.

MORE STEVE SACKS: How Do You Value Your Most Important Asset? | How to Build a Winning Proposal | Six Ways to Fix Your Firm Agreement | The Great Resignation or a Reshuffling? | Listen to Learn | Build the Framework to a Solution with Five Answers | Try for Success, Not a Win
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You may have the requisite knowledge, experience, and perhaps even a broad view based on a diverse set of clients. However, you may have become complacent by maintaining a “cookie-cutter” approach to developing your proposals. Like the old joke defining a consultant: “A person who takes off your watch, tells you the time, and gives the watch back to you,” implies an approach that you believe is best for your potential client, yet reflects no understanding of what the client actually needs.

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It’s Okay to Say No to Clients (Even the Large Ones)

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Working with “smaller” clients can often be more rewarding – and profitable – than “big” clients.

By Frank Stitely
The Relentless CPA

There’s a reason you aren’t actively training clients to allow you to work efficiently. You’re afraid that you’ll lose clients.

I guarantee that you will.

MORE: Control Your Time: Avoid Ambush Meetings and Calls | Get Clients to Bring Tax Docs Early … Yes, EARLY | Why Time Tracking Still Matters | Make Fewer Mistakes, Increase Revenue and Capacity | Six Ways to Create a Millennial-Friendly Firm | Do You Know Your Turnaround Time?
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Clients have trained you to be inefficient. They’ll resist retraining. Some of them will leave and infect someone else’s practice.

The reason you fear losing clients is that you fear you can’t replace them.

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