A totally virtual firm takes a new tack.
By Jody Grunden
Summit CPA Group
If you want to grow your accounting firm, it’s important to evaluate the effectiveness of your process on a regular basis. You want to be aware of what’s working well and what’s not. You also want to continually be improving upon your services over time.
There are three things you can specifically monitor when it comes to the effectiveness of your team. Here's how we do it at Summit CPA Group. Maybe these ideas will work for you too.
1. Employee Satisfaction
At Summit CPA, we weigh our employees’ level of satisfaction with their current clients. We want to know how our employees feel about the clients they’re working with. Every month we survey our employees and ask them to rank their clients.
The employee’s rating of a client often indicates how the client engagement is going in general. For example, if the employee gives the client a high rating, that often indicates that everything is going well – the employee is following the process, meeting deadlines, etc. On the other hand, if the rating is low, that might indicate that things could be slipping through the cracks. Perhaps some deadlines have been missed and the client has concerns or is pushing back. This type of thing will cause tension in the employee-client relationship, which will come out in the employee’s evaluation of the client. Low ratings help us see where our process might need to be reviewed and improved.
2. Client Satisfaction
In addition to employee satisfaction surveys, we do a monthly customer satisfaction survey as well as a semiannual Net Promoter Score (NPS). These ratings and feedback from our clients help us understand how our clients feel about us and the service they’re receiving from us. They also indicate any areas where we might be able to improve.
We don’t just wait for negative feedback, however. Our workflow management software also helps us monitor the workflows, tasks and deadlines of our team members on an ongoing basis. We can watch for anything that might be slipping through the cracks (i.e., missed deadlines or incomplete tasks) so we can be proactive about turning a potentially negative situation around before it even happens.
The third thing we look at is profitability. One surefire way to evaluate the effectiveness of your process is by keeping an eye on your gross profit, as this number should be increasing over time. We are continually reviewing our processes and proactively searching for areas where we can become more efficient in order to increase our profitability.
Here’s an example: If you’re a service-based company and your gross profit is below 50 percent, you know either your pricing is too low or there may be inefficiencies that you can work on. If your pricing is appropriate within the competitive market and your gross profit is below 50 percent, then you need to focus on becoming more efficient. The more efficient you become, the more profitable your company will be.
These three areas are key when it comes to the effectiveness of your team. They will determine whether or not your company will be able to grow. But keep in mind all three of these areas must work together in harmony. If, for example, your company is super efficient but your customers hate you, you’re going to lose customers and long-term growth will be a struggle.
Employee satisfaction, client satisfaction and profitability are the barometers for the effectiveness of your team. Once you are measuring these three things, you can set baselines and goals for each area. Again, all three need to be in harmony. If any number falls below the goal, you know there’s something within your process that needs your attention. And this allows you to continually improve upon your services and keep your company growing.