Dirty Dozen Dogmas That Damage Accounting Practice Growth

“I am buried!”

This response came from an experienced CPA when I finally managed to reach her on my 8th attempt over 8 weeks. She was convinced that she needs to do something different to be able to focus on her practice growth. I had detailed discussions with her on how my company can help her achieve practice growth targets. She was totally convinced that she MUST do it. She had in fact done a lot of hard work to identify the top 5 new initiatives that she wanted to implement “this quarter” and at nearly the end of the quarter, she was where she was at the beginning of the quarter; may be actually behind.

  • I am buried. I’m becoming regularly distracted from the things that will help grow my practice. I am totally client focused and I do everything I can to deliver them the work they expect from my firm.

In one breath, she not only told me the problem but also the root cause of the problem. Between practice management and practice growth, her priority (probably forced by the way she managed her practice, till now, that is) was to serve existing client needs. She was facing a Dogma.

DOGMA 2: DAILY DISRACTIONS DOGMA

According to AICPA’s 2015 survey results, getting new clients and retaining existing clients are two of the top 5 challenges for accounting firms of all sizes. Technology and the internet have made things different and easier for you, and for your clients and prospects too. They can now easily compare you with others. Hence, to get new clients, you have to be engaged with prospects, much more than ever before. And to retain existing clients, you have to make sure you are giving your best to them.

When your focus turns IN-wards, instead of focusing OUT onto new prospects, you fall into the INevitable trap that stalls your practice growth. Even if you get new clients mostly by referrals, you still have to spend significant amount of time to make them feel comfortable doing business with you.

Imagine this: You have a very tense deadline to deliver something to an existing client and you are worried about the quality of work so you want to take a look at everything yourself before delivering the work to your client. You are now letting incoming calls go to voicemail or “gate-keeped”. A prospect eager to talk with you gets disappointed at the first hurdle he faces in reaching you. More damaging is the doubt in his mind that tells him“Will this CPA be available to me when I really need?”

When your IN (focus) is far more than your OUT (focus), the INevitable has trapped you, into a stagnant practice.

The INevitable (?) Trap That Stalls Accounting Practice Growth!

But then your clients’ work needs to be produced and delivered. The same AICPA survey results also prove that Finding and retaining qualified staff has been one of the top 5 challenges of firms of all sizes. It means YOU are busy hiring, training, reviewing work done by your staff, correcting their mistakes, firing, and re-hiring when staff leaves.

“Even very short interruptions are particularly bad when people are performing tasks that require a sequence of steps. The interruption disrupts people’s ability to remember where they are in the sequence, and so they are likely to carry out the wrong step following an interruption”………………………
……………..Psychology Today: A new study shows the effect of losing your focus

Accounting and tax related tasks are always a sequence of steps. And with the complexities of regulations, unless the person is qualified and experienced, one single person invariably can not complete all steps. It means, the firm owners, partners and seniors are “too busy putting out fires” – which is a common phrase in the vocabulary of many CPAs.

All of this ends up distracting you from things that help grow your practice. Surveys indicate that percentage of billable hours to total hours for reasonably effective firms average about 75-80%. And considering that at accounting firms, staff averages about 1,400 to 1,500 billable hours a year; and partners average 1,000 to 1,100 billable hours a year, firms lose between 1 – 2 hour/s per day per person to non-billable activities. While “productive investment” into administrative and training activities is essential to boosting performance, “non-productive” distractions can cost about an hour a day per person. At National average billing rates, Distractions can reduce $ 25,000 a year from the profit of a small firm.

YOU have the responsibility todo the work that really matters:

For the sake of your deserving clients, for the sake of your talented employees, for the sake of your near and dear ones, and most importantly, for your own sake, YOU have the responsibility to do the work that really matters, without getting distracted. And as a qualified accountant with wisdom gained through experience, what really matters is the magnitude of positive IMPACT you (can) make on people’s lives.

Is your work making a profound difference in people’s lives?

But it All IS Revenue Generating Work. I/We Must Do it!

Agreed. A lot of “work” that you do does contribute to revenue generation, directly or indirectly. But things change. Collecting documents from clients was a work we all did. Now, technology automatically “fetches” bank statements into accounting software. Technology is “doing” the work that we once did.

Habits create Dogmas in our minds.

InThe Power of Habit, award-winning New York Times business reporter Charles Duhigg quotes examples of how people achieved astonishing success by focusing on the patterns that shape every aspect of our lives. He says. “They succeeded by transforming habits“.

Habits make us believe that we are doing the best we can. Renowned Harvard psychologist Dan Gilbert says we somehow imagine that the person we are right now is the person we’ll be for the rest of the time, and hints: that’snot the case.

Human beings are works in progress that mistakenly think they’re finished.

…………..Dan Gilbert’s Ted Talk

The essence of “what really matters” is repetitive steps and tasks (even when they are knowledge and rules based) can be “trained for”, and hence, moved to lesser experienced and even lower cost resources, including to technology. And that CREATES precious time for you, the experienced and expert accountant.

Our inability or the difficulty we experience in “changing ourselves” stems from the Dogmas in our minds. Distractions arise from our own Dogma.

If you are getting distracted every day, you are facing “I must do it myself” or “I must check this myself” i.e. The Do-It-Yourself (DIY) Dogma.

What’s The Solution?

You are a human being; not a human-(always)-doing. Separate the “IN-focus” from the “OUT-focus”.

Get work done with the same, or even better quality from reliable resources, including technology, that you do not necessarily have to manage personally. Smart entrepreneurs hire others not just because they themselves don’t have enough time, they leverage skills of others who can do the jobs better than themselves. A true delegation is when you manage the outcomes, not the process steps. The faster you create that reliable resource capability, the better your “OUT-focus” will be. If we can not leverage other people’s time, we can never expect to grow beyond a particular level of business volume.

And in the process, you might be prohibiting hundreds of deserving people to get your help in managing their financial lives better. Doing justice to your talents is simply letting your talent put to more work by doing only the work that really matters. Believe it or not, most people underestimate the real value of their time. Do you know the true value of your time? If you can estimate how much money each hour is worth to you, then you can make wiser decisions about how to spend that time. Here is a free super tool to help you calculate the true value of your time. Once you know the money equivalent of your time, you can sense the Distractions costs.

Don’t let the distractions Dogma cost you $ 25,000+ a year.

This is part 2 of the 12 parts series of articles that will be published to analyze the 12 most common practice growth challenges accounting firms face and provide suggestions on how to overcome them.

Watch out this space for the 3rd part coming soon.

Click here to read Part 1 of 12, “I-Don’t-Have-The-Time” Dogma

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The author is the Chief Operating Officer of
Pransform,
a firm laser-focussed on providing life-liberating work choices for accountants. If you are a CPA wanting to overcome the Distractions Dogma, Pransform could be your first step towards the solution that helps you take
advantage of back-office accounting services
to help you focus only on work that matters leading to your practice growth.

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