Communication: key to meeting challenges.

While the CPA profession is always evolving, the dramatic shift in regulatory oversight and standard-setting has been fairly revolutionary during the past few years.

Interested in what this upheaval has meant to CPA firms, I've spent the past two years informally polling participants in my classes to research the question: What are the top six challenges of a CPA firm? I grouped their responses into partnered firms and sole proprietors.

Sole Practitioner Firms--Top Six Challenges: Finding, managing and keeping quality personnel; practice administration; sales and marketing efforts; time management (balancing personal and professional lives); communication with clients and within the firm; and maintaining the technology to best serve clients.

Partnered Firms--Top Six Challenges: Finding, managing and keeping quality personnel; firm management and administration; the partner decision-making process; partner succession; dealing with a reactive vs. proactive environment; and marketing, building and achieving value for services rendered.

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MEETING THE CHALLENGE

Of these 12 challenges, six are critical to firms of all sizes. And if you address them in a concentrated, focused and committed manner, success will follow.

ISSUE: Quality Staff

SOLUTION: Opportunity/Training. Give your staff the chance to explore, make mistakes and learn from those experiences, all of which will help them grow into responsible partners some day.

Augment this with interactive educational programs, including mentoring. Also, take inventory of the staff's individual skills and experiences and match those skills with tasks that will help clients.

For example, someone with good computer skills should work with the firm's and client's information technology needs.

Matching skills to tasks also provides staff members with a better understanding of where they fit in the organization and, if possible, in what direction they should take their career.

ISSUE: Expanded Services

SOLUTION: Understanding Client Needs. Listen to your clients, observe their patterns and talk with them to help you--and them--clarify their needs and wants. Then deliver the services they need.

ISSUE: Client Retention

SOLUTION: Positive Client Perception. It is essential to help clients understand and appreciate what we do and how we do it. If they just receive a tax return and are told how much to pay, where and when to mail, and our bill, what do they really get?

Clients need to understand the challenges and risk/benefit analysis that go into the work you perform for them. Put yourself in your clients' shoes, ask questions you would like others to ask you, help them help you resolve the issues together. It's helpful to document your conversations so you can look back on them later and review your successes.

On larger projects, progress reporting is essential if you want to keep clients and advance your relationship. Clients place greater value on services when they understand the project's progression and the full scope of the services rendered, not to mention how the fee is determined.

If you haven't been communicating with the client and the outcomes are not what the client expected--they generally will blame you. And why wouldn't they? They probably did not have enough information that would lead them to any other conclusion.

ISSUE: Team Environment

SOLUTION: Give and Take Communication. Establish an environment where everyone feels comfortable contributing their ideas. Listen first, talk second. Projects move more efficiently when everyone is on the same page.

If something goes wrong, focus on what happened and how the problem can be resolved, not on who made the mistake. This creates a more open work environment.

One way to reinforce this culture is to acknowledge team members who are successful and how their success has been critical to the firm.

ISSUE: Succession Planning 

SOLUTION: Solid, Quality People. Succession planning requires training, mentoring, career path development, adequate compensation and leadership training, as well as compassion and understanding for those taking over the ship.

Future leaders must understand their responsibilities and why they have been chosen--that you want them to be part of the firm's long-term future. This gives them a sense of belonging.

So many firms lose their best potential partners because these employees feel like they don't belong. Taking time to listen, get feedback and understand who these leaders are is a sure-fire way to keep them on board.

This also applies to sole practitioners. Once you have good people it is essential to help them appreciate their place in the firm's future.

ISSUE: Sales/Marketing Expertise.

SOLUTION: Maximize Everyone's Abilities. Everyone can market and sell in their own way. The key is helping them to identify these gifts, and to make sure they receive the right training to become comfortable expressing themselves so that others, especially clients, want to work with them.

Marketing is a complex and multifaceted endeavor that requires the skills of many.

Some people give speeches, some write articles, others research key information and other published articles--all of which can help clients.

Some maintain databases, some join groups (social or professional), some are good at selling new services to existing clients, while other are great glad-handers, who excel at securing new clients.

The solution is the right person in the right slot. We can't be what we are not, but we can do what we like and what we are good at. That's how we succeed. The key is everyone needs to be involved.

AN ESSENTIAL INGREDIENT

These solutions to your challenges may seem reasonable and logical, but they require hard work. And though there are many different issues involved with each challenge, the essential ingredient to solving them all is excellent listening skills and a willingness to use them.

Active listening may not have been a course we, as accountants, took in college, but it is a skill that we can't avoid in our practices. We are still the most trusted advisers to business. But if we want to turn our challenges into successes, have clients appreciate our true value, maximize our energies (time and money), properly manage our growth, keep and nurture the staff we want, and stay close to our clients, then listening is critical.

To meet our challenges, we need to be proactive, up front, confident and clear about what we can do to help our clients. By embracing new and better communication abilities, the challenges of today will be more easily resolved. We can then begin to be ahead of the curve instead of behind it.

BY MARK H. FOWLER, CPA

Mark H. Fowler, CPA is president of Stowe Management Corp., a corporate re-engineering firm working with CPAs and their clients. He teaches "Helping Businesses Grow" and "Getting And Staying Close To Clients" for the California CPA Education Foundation. You can reach him at [phone].