A good hire is hard to find.

Any smaller practitioner who has tried to recruit qualified, reliable staff in the last few years has probably met with at least some frustration. Because of a strong economy and past hiring cutbacks at larger firms, CPAs report there is a smaller pool of people looking for work, especially in the three-to-five-year experience range. They go on to say that those seeking work don't have the kind of experience they seek or are unwilling to take on some of the demands of a career in public accounting. "We are seeing a staffing crisis," says David McIntee of McIntee & Associates, a four-person firm in Kinnelon, New Jersey, expressing the experience of many firms.

The traditional route of hiring full-time staff members straight out of college and letting them grow with the practice is no longer reliable because many grads favor other lucrative, less demanding professions. "I find it a very rewarding profession, but other professions hold intrinsic rewards," says Mary Lou Pier of five-person Pier & Associates Ltd. in Chicago, who has seen some staff members quit simply to shorten their commuting times. "Other professions pay more and don't require 2,800 hours a year."

Despite this situation, CPA firms continue to thrive and produce high quality work because they have found innovative approaches to hiring and retention. Three small firms have each discovered creative ways to address the hiring dilemma, and their experiences may offer ideas or solutions for other practices.

COLLEGE PREP

In his firm, rather than fight to attract the best newly minted graduates, McIntee has connected with a local college with the intention of bringing accounting students into his firm before they graduate, introducing them to the business of public accounting--and to the advantages of working in his practice. "We give them part-time jobs in the office with worthwhile responsibilities and commensurate pay. We hope they will see the opportunity and not look elsewhere" when they graduate. While his firm has only begun working with interns, McIntee, who is the incoming chairman of the AICPA PCPS small firm advocacy committee, believes a local practice can be an attractive ultimate career choice if it provides meaningful assignments rather than relegating interns to answering phones and filing papers. For example, the firm's current intern has done write-up and small corporate returns. "She needs greater supervision, but students are eager to learn," he says. He does acknowledge, however, that administrative tasks are part of the business. "My student assisted our administrative person in collating tax returns, which is an important job in our firm. I think the intern should understand that process because at some point she's going to be delegating that work. She is learning what goes into a tax return." (For more on interns, see JofA, Dec. 96, page 89.)

THE LONG HELLO

Pier, the chairwoman of the AICPA small business taxation committee, just hired the fifth firm member after disappointing experiences with some short-lived past staff and would take on a sixth person if she could find the right one. In selecting her recent hire, she made two adjustments in her usual procedure. First, she dropped her requirement for someone with a public accounting background, accepting instead an appealing prospect who had worked in government accounting. "I'm taking a risk on that," she says. "My ideal candidate has three to five years' experience in tax or seven to nine in accounting and audit." She also has extended the interview process to include more discussion time in order to get a more accurate sense of a prospective employee. "The personality fit must be right because that's so important for a small firm and for creating the kind of client service culture we want," she explains. She begins with a telephone interview, then conducts two to three interviews in person "because people interview differently in different situations. By the third interview, they are much more comfortable." The first appointment might be with Pier, while the second is with her manager. The third meeting usually is a lunch with both Pier and the manager. By taking this added time, Pier hopes to get a better sense of whether the candidate will be able to contribute to the firm's client service culture. "We are looking for the philosophical fit, the entrepreneurial spirit. Our attitude in the firm is `we're here to help.'" To find out if they share that attitude, Pier offers examples of real-life situations and asks how candidates would react to them. "We ask if they would be comfortable dropping everything to travel to meet a client who needs assistance. We also ask, `Even if you don't do it yourself, could you coordinate that level of client service?'"

NEWBORN FLEXIBILITY

The premium on experienced talent has inspired some firms to adopt new policies to retain quality staff. At Delfino & Pirolli in Warwick, Rhode Island, the senior accountant, a critical staff member in the five-person firm, gave birth in March and took several weeks' maternity leave, which was a first for the firm. "I told her, `I've never had a full-time key person have a baby before; what do you think we should do?'" says William Pirolli. "She said, `I don't know; I've never had a baby before.' We agreed not to make any promises we weren't sure we could keep. I didn't ask her to promise she was definitely coming back in 13 weeks, and I didn't promise I would never need her during her leave."

Although the firm had plenty of notice, "we didn't have a lot of options in covering for her because there was no way to replace someone that critical," says Pirolli. He and his partner decided to work longer hours to get the work done themselves, since it seemed impossible to find an immediate short-term replacement for such a high-level employee. Taking on her workload was daunting, since she is the only full-time accounting employee and has a substantial client load and client contact, which Pirolli has picked up. "The clients understand; that hasn't been a problem. Our biggest challenge has been getting the work out the door:'

As the accountant's leave drew to a close, she began to come in one day a week not only to handle work but also to test her babysitting system. Pirolli, a member of the AICPA PCPS small firm advocacy committee, advises firms in similar situations to plan well in advance. The partners decided early that it was in their best interest to make the process as smooth as possible for both sides. "We bought her a home computer as soon as she told us she was pregnant just in case she needed to work at home during the pregnancy. Although she worked up until the day she delivered, we haven't determined yet if she'll come back five days a week in the office or work some of the time at home," so the home computer continues to be a good investment. "I told her that we have to make this work for 13 years, not 13 weeks. Her needs will change as the child grows and she has another. If we are flexible, we can enable her to juggle a career and family."

Pirolli has concluded that the benefits of this arrangement outweigh the drawbacks because flexibility can help small firms deal with unexpected staff developments. "Each person's impact on a small firm is very great--especially with key people--because you lose such a large percentage of your workforce," he says. Small firms can respond to employee needs more easily than large practices because they have fewer people and less bureaucracy, Pirolli notes, but their small staffs can also make it is harder to adapt when staff changes occur. "We don't have to set a policy every time someone asks for something; we just do it. If some people want to change the days they work, that's okay. If they want to come in at 6 A.M. and leave at 2 P.M., we'll work with them. But when someone is missing, I don't have the staff around to fill in."

OUT OF THE BOX

All of these practitioners believe hiring and retaining qualified employees will remain a top challenge for smaller firms. "The employment market has changed drastically and quickly," McIntee observes. He cites a strong economy as a reason for the tighter hiring environment, but says, too, that firms need people with more experience than they have in the past. "We're not doing cookie-cutter work anymore" because of specialization and economies of scale. He sees two choices for his firm: Either he will retain his current client base and continue to struggle with staffing issues or he will prune away some engagements to the point where the client demands match current staff capacity (see JofA, Jan.98, page 77). Although he believes that narrowing his client base through greater specialization is probably the wisest choice, cutting clients is a tough business for small firms. He's most used to working with a "full-time staff count. It's easier to manage and it's an incentive to bring in work for them to do."

Traditional procedures aren't going to be enough to succeed in the future, Pier concludes. "You must challenge yourself to try different routes. That's true in our practices and it's true with our employees, too." Firms seeking new solutions to staffing issues may want to consider working with interns, fine-tuning their interview processes or adapting more flexible policies as alternate approaches to this ongoing dilemma.

Problem: Finding and keeping quality staff in a tight market.

Solution: Cultivate college interns; lengthen the interview process; adjust to firm members' life-style needs.

RELATED ARTICLE: EXECUTIVE SUMMARY

* SMALL FIRMS ARE FINDING FEWER PEOPLE in the talent pool, and those seeking work may not have the proper backgrounds or are unwilling to take on some of the demands of a career in public accounting. However, firms can continue to thrive by taking innovative approaches to hiring and retention.

* A FOUR-PERSON NEW JERSEY FIRM brings in accounting students as interns to acquaint them with the profession and with the firm itself. The firm tries to provide meaningful assignments and commensurate pay in the hopes the best prospects will stick with the firm when they graduate.

* MORE INTENSIVE INTERVIEWING HAS HELPED a five-person Chicago firm target the best candidates. A series of two to three interviews helps determine whether prospects have the right attitudes about client service and other key concerns.

* FLEXIBILITY AND GOOD PLANNING enabled a small Rhode Island firm to weather a key staff member's maternity leave. Among other steps, the practice equipped the woman's home office at the beginning of her pregnancy to ensure she could work there if necessary.

RELATED ARTICLE: Sound Advice

When choosing an intern, consider a candidate's long-term potential as well as other qualifications, counsels David McIntee. For example, he decided not to select one excellent student who saw accounting as a stepping stone to jobs in other fields.

To find promising interview candidates, get recommendations from clients, professional contacts and other business associates, advises Mary Lou Pier. "Everyone who has worked out over the long term we have gotten through networking recommendations."

To retain staff, don't overlook an option in the mistaken belief that it's only right for a larger business. For example, at William Pirolli's firm, "we have five people, but because we have a young staff we have a section 125 benefits plan that includes a pretax deduction for day care costs that many of the biggest firms don't offer. We want to do whatever it takes to get the employee back to work."

ANITA DENNIS is a Journal contributing editor and the author of Creating a Virtual Office: Ten Case Studies for CPA Firms, published by the AICPA (product no. JA090426).