Tuesday, September 21st, 2021

Labor & Value

“Until you value yourself, you won’t value your time. Until you value your time, you will not do anything with it.” – M. Scott Peck

Periodically, I repost a blog by Seth Godin. I do this when I think that it has special meaning to the CPA profession. I have observed that many CPAs still bill according to the amount of labor (time) that is involved in a client engagement. You should always consider how much value the client receives. Here’s Godin’s post:

Labor and Value

Adam Smith and David Ricardo argued that all value comes from labor, and the value of something is in the amount of labor it took to produce it.

But Henry George understood that this is backward. The value of something lies in how much labor we’re willing to exchange for it.

Too often, we’re tempted to price things based on what they cost us to make. It’s more useful to price things based on what they’re worth to those that might want to buy them.

  • "If you don't know your own value, somebody will tell you your value, and it'll be less than you're worth."
  • Bernard Hopkins

Monday, September 20th, 2021

Communication – Your Firm’s Biggest Challenge

“You can make more friends in two months by becoming interested in other people than you can in two years by trying to get other people interested in you.” – Dale Carnegie

I am delighted to be speaking to the Illinois Chapter of the CPA Firm Management Association on Thursday this week.

I have spoken to them several times over the years. Of course, then it was in person and I had to travel to Chicago. This week it will be a “Team” presentation and I will enjoy talking with the members during the presentation and after and I do not have to leave my office.

My topic will be Communication – Your Firm’s Biggest Challenge.

Any time I get a call from a firm about a particular challenge, issue, or problem it can almost always be traced back to a communication problem. When I talk with team members without the partners present, I always hear that communication is one of their highest concerns. There are eight different ways of CPA firm communication:

  1. The firm to the outside world
  2. Leaders to Leaders
  3. Leaders to team (downward)
  4. Team to Leaders (upward)
  5. Performance feedback
  6. Mentoring
  7. Male vs. Female
  8. Listening

If you are interested in having me talk to your team or association about CPA firm communication, don’t hesitate to contact me.

  • "When I get ready to talk to people, I spend two thirds of the time thinking what they want to hear and one third thinking about what I want to say."
  • Abraham Lincoln

Friday, September 17th, 2021

Flashback Friday – Subscription Pricing

“Price is what you pay. Value is what you get.” – Warren Buffett

This week’s flashback post is a recent one. I think it is definitely worth reading again. It describes Ron Baker’s subscription pricing model.

Now that 9/15 has passed, I hope you have a real weekend – enjoy!

  • "Pricing is actually pretty simple...Customers will not pay literally a penny more than the true value of the product."
  • Ron Johnson

Thursday, September 16th, 2021

Another View of Remote Workers

“Deep human connection is… the purpose and the result of a meaningful life – and it will inspire the most amazing acts of love, generosity, and humanity.” – Melinda Gates

Some people like working remotely and have adapted easily. We hear so much about them. But what about the many people who actually like being with other people?

I think it is human nature to enjoy being with other humans. Happy hermits are few and far between. Some comments I have heard from the younger generation lately made a lot of sense to me, as follows:

Young lady, graduated college in 2020. Has worked remotely for a year. – “I want a REAL job where I go to an office!”

Another young lady, early in her career. – “I am tired of being home all the time!”

Young mother with children in school. She was told by her employer that she would never go back to the office. She would remain remote. – “I get kids on the bus and get kids off the bus. Between those times I work at home. I feel trapped!”

Maybe it is time to rethink making your office attractive and welcoming to employees (and also to clients). I am sure many of you have offered a hybrid solution but don’t forget there are people who really want the in-office environment. It could be a real advantage when doing college recruiting.

  • "The business of business is relationships; the business of life is human connection."
  • Robin Sharma

Wednesday, September 15th, 2021

A Jerk Free Firm

“In my opinion, we don’t devote nearly enough scientific research to finding a cure for jerks.” – Bill Watterson

Recently, a comment from Allan Koltin caused me to give some thought to what a jerk-free firm might be. Koltin noted that if you had a jerk-free firm, the firm would be more likely to have appeal as a merger candidate.

I have observed that most CPA firms have at least one jerk at the leadership level. It could be a partner, a manager, a male, or a female but their jerkdom is well-known and dreaded. Sometimes they are even ridiculed among the team members. Usually, interns can identify the jerk within a week or so and can often do a great job of doing a comic imitation of that person.

Here is a link to where you can read about jerks in the workplace. But how do you define a jerk personality in an accounting firm?

Someone who:

  • Talks excessively but never listens.
  • Takes credit for other people’s ideas.
  • Is always last minute causing chaos close to due dates.
  • Doesn’t respect other people’s time.
  • Leaves a mess in the lunch room for admin to clean up.
  • Ignores the FIFO method for processing work and puts their jobs first.
  • Seems to have no understanding that you have a personal life.
  • Rarely express appreciation of gives recognition for a job well done.
  • Openly makes fun of other people (staff/clients) and gets involved in the grapevine.
  • Dodges client calls when they know there is a problem and delegates it to someone else.

I could go on but you can add to this list if you want.

I suggest you strive to develop a jerk-free culture by establishing some guidelines and goals. Be sure you have identified the firm’s core values and expect all partners to live by them and set a good example

Here is an example of some values that help make a jerk-free workplace;

  • Client focused – Always sriving to provide awesome client service
  • Focused on excellence pertainig to hiring, establishing processes and working environment.
  • Keeping our word – I always think of something Sam Allred said at a retreat many years ago as it applies to partners: “I will do what I say I will do, on time, without reminders.”
  • Team oriented – Everyone at all levels are expected to give and receive feedback to help themselves and the entire team to continually improve.
  • Self-sufficient – I will be a problem solver; not one who creates problems for others to solve.

Be able to say without hesitation, “We are a jerk-free firm!”

  • "Of the billionaires I have known, money just brings out the basic traits in them. If they were jerks before they had money, they are simply jerks with a billion dollars."
  • Warren Buffett

Tuesday, September 14th, 2021

New Survey About Remote Work

“Being a great place to work is the difference between being a good company and a great company.” – Brian Kristofek

Here are some interesting findings from a recent survey by flexjobs. The last segment about the importance of company culture should be something CPA firms should consider.

44% Know at Least One Person Who Has Quit or Plans to Quit Because of Employers Revoking Remote Work

New FlexJobs survey highlights the high-value employees place on remote work, mental health support, and company culture

Boulder, CO, September 13, 2021 – According to FlexJobs’ survey of over 4,600 respondents, 44 percent know at least one person that has quit or is planning to quit because their employers are requiring them to return to the office. 29 percent are actively looking for a new job because they want to work remotely, while 17 percent have quit a job because it did not offer remote work options.

“It’s a job seeker’s market right now, and workers are more empowered than ever to leave job situations that aren’t ideal, or leave companies that aren’t allowing them to work the way they want to,” said Sara Sutton, Founder and CEO of FlexJobs. “As our latest survey highlights, workers are placing an extremely high value on the option to work remotely, and they’re committed to finding companies that are embracing remote work as a long-term workplace model and have a healthy company culture to support it,” Sutton concluded.

Remote Work Matters:

  • 44% know at least one person that has quit or is planning to quit because their employers are requiring them to return to the office
  • 29% are currently looking for a new job because they want to work remotely
  • 17% have quit a job because it did not have remote work options
  • 21% would give up some vacation time, and nearly a quarter (24%) would take a 10-20% cut in pay in order to work remotely as much as they want
  • Post-pandemic, 58% prefer a fully remote job, and 39% want a hybrid arrangement that combines both office and remote work; only 3% report wanting to return to the office full-time
  • However, 42% report that post-pandemic, their employers will require them to be in the physical office; 27% will have hybrid work arrangements; 17% will be fully remote; the remaining 14% were unsure of their company’s plans

Other key insights from the survey:

Mental Health Matters:

  • 70% say a permanent remote job would have a huge improvement or positive impact on their mental health 
  • 81% of respondents said having better work-life balance is the #1 factor for wanting a job with a flexible work option
    • Other reasons for wanting a flexible job include commute stress (50%), family (47%), and exposure to illnesses (43%)
  • Lack of healthy work-life boundaries would cause 57% to not apply, not accept, or to quit a job
  • Nearly one in five (18%) said not offering mental health support was a big mistake their company made during the pandemic

Company Culture Matters:

  • Toxic culture would cause 73% of respondents to not apply, not accept, or to quit a job. Other reasons include:
    • Micromanaging boss (58%), lack of healthy work-life boundaries (57%), and not allowing remote work (55%) or flexible options (50%); the top reason was a low salary (79%)
  • Poor communication from leadership was the biggest mistake made by employers during the pandemic (30%). Other top-reported mistakes included: 
    • Not fully understanding the stress of work-life conflicts during the quarantine (25%)
    • Unrealistic expectations about productivity during quarantine (22%)
    • Poor management of workers overall (22%)
    • Being too rigid with schedules (17%) 

Read more here.

  • "We have a culture where we are incredibly self critical, we don't get comfortable with our success"
  • Mark Parker, CEO, Nike

Monday, September 13th, 2021

Leadership Development

“If your actions inspire others to dream more, learn more, do more and become more, you are a leader.” – John Quincy Adams

Once again it is time to remind you of the leadership development programs offered by Convergence Coaching. Too many firms have ignored the need for structured leadership development programs and thus limit their choices when considering firm succession.

Convergence’s flagship program:

Transformational Leadership Program™ (TLP) – Kicking off with a remote web seminar on November 1, participants pay $6,500 for the year. This one-year “finishing school” for high-potential managers, senior managers, directors, new partners and key administrators includes a combination of one-on-one coaching, two 2-day workshops (in-person or can pivot to remote if needed), 2-hour web-based roundtables, online self-study and a special in-firm project. Participants join a cohort of up to 26 other leaders from firms around the country, learning both from facilitators and each other in this year-long program.

There are also other programs for up-and-comers in your firm:

  • Leadership Development Program for Seniors and Supervisors (Kicking off October 25)
  • Client Advisor Program (Will soon be scheduling 2022 dates)
  • Rainmaker Development Program (Will be scheduling 2022 dates)

Here’s a graphical view of the programs available:

  • "A leader takes people where they want to go. A great leader takes people where they don't necessarily want to go, but ought to be."
  • Rosalynn Carter

Friday, September 10th, 2021

Flashback Friday – Essential Questions

“It is not the answer that enlightens, but the question. – Eugene Ionesco

Many of you are planning a Fall partner retreat. I know you will work diligently to establish a well-thought-out strategic plan.

When you are all finished, answer some important questions posed by David Maister.

Read this Flashback post from 2018.

  • "Judge a man by his questions rather than his answers."
  • Voltaire

Thursday, September 9th, 2021

Does The Pay Justify The Toil?

“Leave something for someone but don’t leave someone for something.” – Enid Blyton

Are you always doing exit interviews with staff? Do you know for sure why people are leaving your firm?

There are times when someone gives notice, you and their peers are all thinking, “Thank goodness!” That should never be the case! Deal with poor performers directly and don’t just hope and pray that they will quit.

During these times of a severe talent shortage, you might find out why in an article via Accounting Today titled, 5 Reasons Staff Are Leaving Your Firm, The author, Chase Birky notes:

The leading voices in our profession consistently cite a pipeline issue — the number of accounting graduates and CPA candidates coming through the system is not high enough to meet demand — exacerbated by the strain brought about by COVID-19. However, this explanation is superficial; it only accounts for the symptoms and not the underlying illness.”

Overwork has been a problem for years but we always downplay it saying to staff that it is only a few months each year when the workload is heavy. In days gone by, that might have been the case. I rarely talk to a firm that is not very busy all year long now.

So, the staff is feeling overworked and stressed. Per Birky, “People are fed up with being treated like a machine in an assembly line. The pay no longer justifies the toil.”

The Five Reasons are – 1) Toxic leadership, 2) Unrealistic workload, 3) Compensation plan is lacking, 4) Confusion about advancement, and 5) No self-determination.

Read more about each of the Five Reasons here.

  • "People fear leaving their safe harbor of the known and venturing off into the unknown. Human beings crave certainty - even when it limits them."
  • Robin S. Sharma

Wednesday, September 8th, 2021

Cover Letters

“A well-written cover letter can be the difference between winning or losing a job opportunity.” – Larry Sheftel, Aprio

It is always great to be featured in The Journal of Accountancy. Thank you to Teri Saylor for contacting me to discuss the power, lack of power, and use of cover letters for resumes.

Do you expect a cover letter when someone submits a resume? Do you even care? Some beneficial information can be obtained from someone who writes an exceptional cover letter if the hiring manager at your firm actually reads it.

I believe that cover letters have almost become a thing of the past. Everyone seems to be in a hurry these days and do not think of including a cover letter. Those doing the hiring are also in a hurry too and don’t even read a cover letter if it is included.

I asked one of my clients if they always expect a cover letter with a resume. He said yes because they ask in the ad, “submit your resume and cover letter to…. ” They don’t care about the cover letter but they just want to see how many people follow instructions!

I hope you take the time to read the article. It was also nice to be featured along with my friend, Larry Sheftel of Aprio (pictured).

  • "In looking for people to hire, look for three qualities: integrity, intelligence and energy. And if they don't have the first, the other two will kill you."
  • Warren Buffett