Learn the secrets of the top-earning CPAs and highest-grossing accounting firms.
by Rick Telberg
From the iPad to the cloud, new technologies are changing the way we live and the way CPAs work. Indeed, a new technology model is emerging that may be changing the way CPA firms work.
Some firms will be better able and better equipped to make the needed changes. Some won’t. Some will be able to embrace the changes to free up highly-trained professional talent for high-end services. Others will cling to old technologies, old workflows and old roles.
“The decisions you make over the next few years will be critical,” CPA.CITP Gary Boomer was telling a room full of CPA firm CIOs at the annual CCH User Conference in Orlando, Fla., last week. “You can’t ignore it and you can’t go back.”
The tech directors were listening raptly. Understandably so, since, for some of them, their jobs are one the line. The revolution to mobility, remote connectivity, and always-on everywhere-available cloud-delivered services has many of them worried.
That’s why Boomer was describing for them a vision for their new roles in the firms, and a new vision for even non-techies to understand and embrace new tech evolutions.
The most mundane, if critical, tasks of network administration, software upgrades and hardware maintenance are becoming industrialized and commoditized. That’s bad for IT directors who know nothing else. But good for IT directors and anyone else who’d rather focus on improving systems, enhancing productivity, serving clients and other constituencies, and making more money for themselves and their organizations.
Consider for a moment the fact that the vast majority of the CPA firms in the nation gross less than $3 million a year or that most CPAs earn less than $100,000 a year, according to Boomer. And yet, relatively few CPAs earn over $1 million a year and 1% of firms (about the top 100) gross more than $30 million a year.
What are they doing differently? Many things perhaps. But Boomer focuses on five structural factors:
1. Leadership and management,
2. Development of people,
3. Development of clients,
4. Technology, and
5. Compensation.
“These are the things that differentiate firms,” Boomer says. They are, as well, the factors that differentiate careers.
To gauge your firm’s performance in each category, rate your firm from A-plus to F on these five issues:
1. Our firm has strong leadership.
2. Our firm does a great job of developing people, especially in the soft skills.
3. Our firm focuses on a specific, targeted client profile, consistently throughout the firm.
4. Our firm has excellent technology.
5. Our firm has a relatively fair compensation system and I trust the people administering the plan.
If you gave your firm anything less than a grade A, you can see where you need to get to work.
One Response to “Five Keys to the Million-Dollar Club”
Lee Frederiksen
We have recently published several research studies on what differentiates high growth high value firms.
Of the five factors Gary lists, two seem to have the most support from our research.
Most significant is 3. High growth firms tend to specialize and have a very tight target client focus.
And while all firm, high growth and regular growth, put a strong emphasis on getting good people, the high growth firms are more likely to train non-sales people on sales skills ( a soft skill).
The supporting research is available without charge at http://www.hingemarketing.com/library
Thanks for a nice post…. lwf