Accounting Today - August 16 2010

BY L. GARY BOOMER
Five strategies for organic growth

Growth is important to CPAs and their firms because it provides additional capabilities, opportunities, revenue and profit. Growth can be organic or from mergers and acquisitions. Many firms are doing both, but growth requires planning, people and processes. Growth doesn’t just happen because the partners in your firm decide they need to grow by 10 percent annually in order to maintain partner income. The focus of this article is on five strategies that will help your firm grow organically. They all require thinking, planning and execution, and accountability. The past two years have been challenging for all firms. The ability to grow will be even more important in the future than it has been in the past.

Over the past 15 years, I, along with others at Boomer Consulting, have had the good fortune to participate in Dan Sullivan’s Strategic Coach Program for entrepreneurs (www. strategiccoach.com). We have learned about many strategies that apply to our consulting business as well as to the CPA profession.

One of the most important lessons is that every industry goes through what is known as an industry life cycle, where an emerging industry grows into a growth industry to a status industry and finally a depleted industry, at which point an industry bypass takes place and the cycle repeats itself. The cycle can take many years, but the trend is toward faster life cycles. Industry transformers are those leaders who can take their firms from the depleted to the emerging stage.

Financial services and accounting have
both been impacted by technological, scien-
tific, economic, social, cultural and political
change. How firms deal with this change is
the key to growth and success. Some of the
more prominent characteristics of a depleted
industry are:
Commoditization — fee pressures;

Increased litigation;

Increased regulation;

Increased complexity of the business
model; and,
Unique processes and branding become
extremely important.

“
”
The gravity
of the past
can destroy
the margins
of the
future.

transform themselves into the new emerging and growth industries. This requires vision, leadership, discipline, risk management, and a set of core values that foster innovation, growth, trusted relationships, integrity, teamwork and accountability. This is by no means an easy task, as the gravity of the past is typically stronger than the potential of the future for many CPAs and their firms. This requires that firm management continue to manage the current firm while leadership is developing the future firm. These are not sequential, but rather simultaneous events that require time and capital.

While there are numerous strategies that firms can implement, the following five transformational strategies have proven to provide value to firms and their clients.

1. Listen to your clients.

2. Identify, name and package your unique processes.

3. Move to fixed-price agreements and change orders.

4. Leverage technology.

5. Move up the value chain — information, knowledge and wisdom.

I will further define and summarize each strategy, with specific examples and action steps you can implement in your firm.

retain a profitable client makes good business sense. This also demonstrates that you value the relationship and will often produce referrals. D.O.S. conversations allow you to develop and package new services that meet the needs of your clients.

UNIQUE PROCESSES

Every firm has multiple processes, but few firms take the time to identify, name and package their best processes. By doing so, they foster best practices, reduce redundan-cies and document the processes so less expensive labor and technology can perform the processes.

This is all part of Six Sigma and attempting to drive out errors at the lowest cost. The real value comes in the naming and packaging. If you name the process, you own it. Clients and prospective clients are impressed when CPAs name their processes and graphically display them. Written text or speech is not nearly as powerful as a graphic and a name in the sales process. The naming process can be a bit tricky and time-consuming until you have mastered the technique. Marketing professionals have generally had training in this area, while CPAs have not. A few quick tips I learned from Strategic Coach:

1. Use “The” to demonstrate exclusivity. “The” is much more powerful than “A”.

2. Use a name to identify the process, e.g., “CIO.”

3. Use a technological word such as “ad-
vantage.”
As an example, one of our programs is
named “The CIO Advantage.” This is a pro-
gram for CIOs to share best practices and de-
velop the skills for innovation and increasing
revenues. You can then use a graphic to assist
in defining the process. The BKN is the Boom-
er Knowledge Network, our social media and
community Web site. ThinkPlanGrow.net is
our blog. Naming and packaging allow you to
connect the dots of your processes in a way
that is understandable to clients.

Gary Boomer, CPA, is the president of Boomer Consulting, in Manhattan, Kan.

LISTEN TO YOUR CLIENTS

Dan Sullivan calls this the “D.O.S. conversation” (for dangers, opportunities and strengths) where the accountant simply asks questions of the client and listens. Clients will readily provide you with answers concerning their greatest dangers, opportunities and strengths. Your job is to help them focus on reducing or eliminating their three greatest dangers, focus on opportunities and leverage their strengths. Often this is a just a matter of increasing their confidence to act. You and your firm can often provide the necessary resources and tools.

This type of session is focused on building the client relationship and not on charge time, a common mistake made in many firms. This is a huge differentiator and will also assist in the process of moving up the value chain. Investing a few hours to gain or