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Do you still fancy behaving like a Post Office after last weeks topic? This week, in the last of the series of the 7 Steps with Clarity Street that EVERY Accounting firm needs to Improve On, we talk about a topic that is dear to Clarity Street’s heart. Like all of the posts in this series, although they’ve been predominantly pitched at Accountants, this week our final blog relates to every business, no matter what industry or size, because it’s true to say that…you can’t be half pregnant, it’s time to fully adopt!
7. YOU CAN’T BE HALF PREGNANT
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Have you sorted out your Debtor issue yet, like we touched on last week? This week our topic is predominantly for the accounting industry, however it’s totally applicable to any service based company that receives mail on behalf of their clients.
6. YOU ARE NOT A POST OFFICE To follow on from last weeks topic where we asked, “why are you acting like a Bank?”, let’s talk about Debtors. It’s a serious issue for any service based business, so much so that there is an entire industry and software platforms, dedicated to reducing the impact this has on businesses of all shapes and sizes.
5. DEBTORS Straight up, why are you acting like a bank? Last week we discussed the need to start being Pro-active rather than Re-active and this question which is also this week's topic, is very closely aligned. Now again, this step is pitched predominantly at Accountants however, being a business owner in any field, this topic should be at the forefront of your thoughts.
4. WHY ARE YOU ACTING LIKE A BANK? After looking at culture last week in our series of 7 steps, for the third step we’re going to focus on something really simple and easy to change, it won’t cost a cent and will give you back control in your business. This step is pitched predominantly at Accountants, but any service based business can adopt the following principle:
3. PRO-ACTIVE RATHER THAN RE-ACTIVE Last week we kicked off our series imploring you to spend time ON your business, not IN your business. This week we need to address something that is so easily forgotten and rarely gets the constant focus that is required. Therefore, the second of the 7 steps is:
2. CULTURE CLUB How much time do you spend with your team, teaching them, listening to them, empowering them? As a Partner in a business, why did you hire staff to begin with instead of just staying a lone ranger? To remind you, no doubt the original need stemmed from your lack of capacity to complete all your client workload and run a business, therefore hiring staff to complete that workload so you could in turn acquire new clients or additional client work and then have it completed, increasing turnover and therefore profit. Some experts would suggest that Partners in an Accounting firm should only spend approximately 30% of their time on chargeable client work. This gives you 70% of your working week to spend time on growing your business and your team. Improving or creating a positive culture within your firm where your team feel valued, empowered, supported and have a sense of job satisfaction, means that for the time they are with you, they are more focused on the job at hand and will be more productive, therefore making them a valuable asset to your business. Spending time on their development means they will make better managers and potentially business partners in the future. It will also ensure your clients are receiving a positive experience, therefore increasing client retention. There are many inexpensive tools that can create a positive culture. With the changing landscape in software, internal messaging tools such as Yammer, Skype for business or Slack can replace emails and create a forum for streamlined communication. Then there are services such as Cultrureamp, or Officevibe that measure your team’s engagement through the use of quick surveys. If these don’t appeal to you, then schedule regular and productive individual catch-ups with every team member, both of you can learn a lot from these meetings! In the next blog, we're going to talk about Starting to be Pro-active, RATHER THAN RE-ACTIVE....want to know more? Get in touch for a chat! Having worked in a number of accounting firms, I’ve seen a lot of different processes and ways of doing things that are occurring.
In my opinion, no business owner ever gets into business to do administration, but by nature of owning a business there is always an element of administration and internal workflow management that needs to occur, in order to provide the service or bot, that you got into business to provide. For the accounting industry, by creating a streamlined approach for the majority of your client work, and only altering that approach where absolutely necessary for those bespoke clients, will allow you as business owners to focus on providing a valuable service to the majority of your client base, instead of the minority! Now, every Accounting firm likes to think they are different...but the reality is, you are not dissimilar to the other 15K-20K Accounting firms within Australia. Over the next 7 weeks, we'll highlight some critical areas of your business that need some focus and some serious improvement, because getting a grip on these 7 steps, will help you stand out as the trusted advisor you know you are. To kick this series off, lets pose an important question to ponder: Are you an Accountant who owns a Business, or a Business Owner of an Accounting Practice? A lot of Partners in firms still do far too much actual client work and not enough Business Development, be it internally or externally. Therefore, the first of the 7 steps is: 1. SPEND TIME ON YOUR BUSINESS, NOT IN YOUR BUSINESS Every week, you should spend at least half a day working on your business. It can be really difficult to put aside the time when clients and staff want your attention, however it will ensure that you are tracking towards your business goals, instead of getting stuck in a vortex of just completing client work. You need to commit to this though, block out the same time every week in your diary and DON’T make exceptions. This is your time to spend on investigating new processes, streamlining current ones and looking at new software options. Refocus your business goals and KPI’s, invest time in marketing and new client acquisition. Spend time with your team and keep them updated with internal changes and industry knowledge. The ability to spend time on your business on a regular basis, means your focus is adjusted and areas for improvement can be identified quickly, to allow you a much smoother overall workflow process. This in turn makes you a happier business owner! In the next blog, we're going to talk about Culture....want to know more? Get in touch for a chat! Let’s talk admin from an accountant’s perspective. I often hear, “It’s not rocket science, why is it so hard to get things done?”
If I had a $1 for every time I’d heard a Partner or an Accountant say a variation of “I just don’t understand what the admin team does, it’s not that hard, but everything seems to take so long or things get missed”...I wouldn’t need to write this blog! I spend a lot of time in Accounting firms, both big and small and every one of them suffers from the same issue. Allow me to shed some light as to why the admin team seems to cop the brunt of the industry frustrations. Hypothetically, let’s paint a scenario. You’re a partner in a firm and have recently implemented some wonderful software that allows you to not only upfront price your clients work and get them to accept this proposal, but also collect their payment prior to beginning their work (just like paying for a flight online!). As a firm, your team are all on board with this new process because they understand the value and positive impact this has on the business cashflow and internal processes no longer required for invoicing and debtor collection, they even like working to tighter turnaround times to get the work done! Your clients have also been notified and managed through this transition with letters and phone calls where necessary. Your whole business moving forward is on board with the new “upfront billing and payment” method. Then one day you get a new client come to you. As a partner you know this client is going to be beneficial to the firm from the fees that can be generated. The client thinks you’re fantastic and wants to come on as a new client, BUT...they tell you they can’t pay you upfront like your business terms state. What do you do? As a business owner in a professional services industry, you have two qualities that somewhat conflict. 1. You want to help people, in whatever they need to grow or fix their financial position. 2. You want to make money, everyone does. 99.9% of the time in the above scenario, a partner in a firm will make the decision to accept the terms of the client and effectively say “sure, you don’t have to adhere to our terms, let’s work out a payment arrangement”, not only to help this client, but also to secure the revenue generated moving forward. As soon as you accept the client’s terms, you’ve broken your own process. And who has to remember this and manage it moving forward...your admin team. Now multiply this one break in process across your entire client base, and this will effectively be the amount of bespoke situations that are created and thus need to be managed by the admin team. As an example, let’s use the BAS situation. If you use Xero Tax, in a stereotypical firm, here is a list of the different ways a client has their BAS completed:
That’s over 10 different ways BAS’s get completed and when a Partner asks the admin team for a lodgement list of where the BAS’s are up to, hopefully you can appreciate that one report will not capture all of this information, therefore the time to produce an up to date list will take additional time. In any professional services business, there are some tasks that can be completed with a “cookie cutter” approach, however for the most part, every client you deal with has a bespoke scenario and is therefore treated with a tailored service offering. There is no issue with this however, every time you change or break a process, consider the impact this will have on the admin team and how much more difficult it is for them to do their job, in what you would suggest is a “timely manner”. |
AuthorClarity Street was conceived from years of engaging with Accounting firms on a daily basis and a constant desire to make Accounting firms & SME’s more efficient and profitable. Archives
February 2021
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