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Marketing the practitioner and the firm.


Edward W. Wheatley, PhD, chairman of the Department of Marketing, School of Business, East Carolina University, 3414 General Classroom Building, Greenville, North Carolina 27858-4353, and a practice development consultant, discusses how CPA firms can address the need to market both the firm and its members.

The environment of the public accounting profession is changing rapidly. National firms and prominent regional practices have disappeared or been realigned. Competition from both inside and outside the profession has intensified. The assumption that firm managers or a few talented rainmakers are solely responsible for producing new business is recognized as no longer valid. At the same time, there is a growing concern over the contribution a practice development investment will make to individual practitioners' billable time and income and healthy skepticism about whether institutional marketing programs will be able to produce direct, short-term, positive results for the individual CPA.

For example, in a meeting with 12 partners of a large regional firm, the first 15 minutes could only be described as hostile. The 2 rounding partners had asked me to prepare a marketing program project proposal for the firm. Early in the presentation it was clear the majority of the partners did not support the project. Finally, one of the partners voiced the true concern: "We are going to spend a lot of money marketing the firm. This money is going to come directly out of my partnership income. What will this expenditure do to help increase my billable time and that of my department and its professional staff?."


This emerging entrepreneurial focus is not unique to public accounting. For example, partners in a regional law firm focusing on commercial practice were more interested in how a practice development program would benefit each of them and their specialties than in how it would help the firm. Professional staff in a health care group practice voted to minimize emphasis on medical group marketing and spend more time and money marketing each practitioners specific professional services. These organizations rejected the classic "trickle-down" theory of practice development and adopted parallel programs that focused on both the firms and the practitioners.

The trickle-down approach assumes the firm is the key element in practice development success. If the market is made aware of the firm name, location and services, clients will seek out the firm, orders will be written, billable hours produced and revenues and profits increased. The benefits of the firm marketing program will accrue to all departments and staff. Exhibit 1, above, illustrates this approach.

The entrepreneurial approach to practice development is the conceptual opposite of trickle down. It is based on the assumption a CPA firm exists only because of individual CPAs' successful efforts in developing business and providing client services. Firm revenues are generated one hour at a time by individual professionals. While important, the firm is primarily a holding company and an administrative service center--a collection of entrepreneurs essentially running their own practices under one organizational umbrella. Exhibit 2, below, offers an illustration of how this structure would work.


Which approach is best? A comprehensive practice development program should encompass both. Practice development should focus on both the firm and the individual practitioner. A simultaneous practitioner development program should be designed to focus on assisting firm members to market specific professional skills.

As CPA firms' structures and alignments continue to shift, individual practitioners have valid concerns about the "graduation to grave" career security once seen as the profession's foundation. CPAs recognize it is in their own best interests to become involved in their firms' practice development and be personally identified with specialties and key clients.

Exhibit 3 on page 124 presents a fairly comprehensive example of recommended activities for a parallel practice development program. It may be implemented wholly or in part, depending on firm size, marketing budget, competitive imperative and practitioners' willingness to implement needed practice development activities.


The key advantage to a parallel practice development program is the coordinated benefits generated as both the firm and its professionals simultaneously implement a carefully planned program in a specific market. Firm activities might include practice environment analyses, marketing audits, market targeting and positioning, database creation, new product-service development, practice identity programs and staff training. All of these steps support individual practitioners in developing and implementing their programs, while practitioner activities reinforce the firm's public-awareness efforts. A balance of firm and practitioner activities increases the probability of practice development effectiveness.

The decision to develop and implement a comprehensive parallel program requires a major practice management commitment. Issues for firms to consider include.

* Interdependence. Individual CPA practice development activities' success depends in part on the firm's own program. For example, the results of the marketing audit, client and referral source analysis, targeting, professional and practice development staff training, firm identity programs and client satisfaction surveys provide information and support necessary to the development of practitioner marketing efforts. Coordinating these activities is an important element of program planning and implementation. * Responsibility and control. A comprehensive parallel practice development program cuts across typical organization structure and departmental lines. The larger firm with a full-time practice development-client relations staff is well equipped to coordinate a parallel program, but the smaller firm may use a combination of an internal task force and an external consultant. The consulting arrangement should be ongoing and long-term to ensure focus and continuity.

* Cost. The development and execution of parallel programs require a firm's commitment to practice development. While specifics vary, creating firm and practitioner programs is more expensive than developing either independently. For example, professionals in a regional firm decided to vote 30% of the annual practice development budget to firm marketing and 70% to practitioner marketing support. In addition, they decided to hire a marketing consultant to spend one hour a month with each of the eight partners working on the development, execution and evaluation of their individual practice management activities to ensure coordination and implementation of both programs.

* Evaluation. Who will judge program results? How often? Using what criteria? How will staff be recognized and rewarded for program participation and success? Practice development programs often fail when professional staff effort and success go unrecognized and unrewarded. Advancement and compensation are the two bottom-line motivators. Both practice development efforts and successes should be scored and have meaningful weight in the annual performance review, or the practice development effort will not produce long-term results.


The restructuring of the accounting profession at the international, national, regional and local levels has created a new marketing imperative for the 1990s. Parallel marketing programs offer specific strategies, tactics and activities for both practices and CPAs. These programs can leverage practice development power and benefit both the firm and its members.
COPYRIGHT 1992 American Institute of CPA's
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Article Details
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Author:Wheatley, Edward W.
Publication:Journal of Accountancy
Date:Nov 1, 1992
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