Smart decisions to grow a professional services practice
Posted initially on Tuesday, February 19, 2013, on Ric Willmot’s Blog and it is just as relevant in 2018 and beyond.
Note: Although written for the accounting profession, this article is just as pertinent for business coaches & consultants, lawyers, bankers, financial planners, recruiters, and the like.
The more substantial accounting firms are getting larger. Grant Thornton has just bought BDO. PwC is purchasing high-powered boutique firms like Ashley Munro. It’s unlikely there will be any shift from this strategy by the players in the accounting world, and they may accelerate into the specialised end of the market. Competition is king and dangerously so for smaller accounting firms.
Will you be able to not only survive but continue to reward yourself and your people adequately to make the effort worthwhile? How might your firm compete and stand firm against the globals and multi-nationals penetrating your market space and client-markets?
- Protect your existing book. Today’s clients are your foundation to build future worth in increasingly competitive markets and economies. The big boys have already started cold calling and direct mailing. Examine your work with each client frequently, to assure that you are satisfactorily meeting your client’s current needs. Be sure you understand the client’s industry as well as their business. Be sure your person-to-person relationship is in good shape. Moreover, pay strict attention to the quality of your work.
- You are not in the accounting business; you are in the relationship business. Your purpose is to grow healthy client relationships that guarantee you are remembered and respected. The higher the respect and the more deliberate the link, the more likely your clients will contact you when things are not quite right because they feel safe to confront you. Furthermore, you can expect that when your competitors go duchessing for their business, they will speak with you before making any decision to disengage, giving you an opportunity to protect that client and retain their business.
- Proactively seek and secure referrals, recommendations and repeat business from existing clients. Your practice should set an objective to achieve 15-20% annual growth in business from existing clients, in spite of turbulent economic factors. Frequency, recency and front-of-mind: the keys to making this happen. Have conversations with clients where you are speaking less than 30% of the time. While ever you are talking you are not listening. If you are not attentively listening, you may miss opportunities to accept referrals, recommendations and additional work. Be cognisant that your client’s business is no more static than yours, and is understandably, changing and evolving, reacting and responding to market conditions.
- Don’t assume your practice is of no interest or immune from competition. An economy that is facilitating the demise of firms like BDO to GT is an economy that may very well expose your firm’s vulnerabilities.
- Make certain you, your people and your practice are better today than yesterday. Continually gain the knowledge, skills and experience to be of ongoing value to your clients and prospects. Accounting is a knowledge-based profession¹. Everyone within your practice should actively undertake continuing education in technical skills, professional skills, soft skills, and people skills. Be clear: it’s a necessity, not a luxury.
- Professional accounting isn’t solely about the technical skills of the profession. To be the trusted and valued advisor, accountants must know more about all facets of business, economics, finance, trade, globalisation, technology, staffing, and so forth. The modern accountant is informed and competent about the global village and is informed about context, not merely technical skills.
- Everyone appreciates that marketing is necessary to grow a professional services firm. In light of increased competition from the “big end of town” marketing is vital for survival. Marketing an accounting practice is not the same as marketing a product or commodity. Accounting professionals need to acquire marketing skills and learn to become comfortable working with marketing professionals. You’ve lost the option to consider marketing as a discretionary function by dint of the improved and aggressive way your competitors are going about their marketing.
- Organisational Culture: Accountants have naïvely believed that clients will flock to them and be in awe of their knowledge. Accountants have a business because it is regulated that taxpaying entities must file returns, and audits completed where necessary. However, is your practice the immediate choice for these professional services? Competition is everywhere: services, expertise, standards, service, price, and more. To successfully compete, the culture of accounting firms must shift from an intellectual profession to a value-based, service-centric advisory enterprise.
- Organisational Productivity: Control operating costs, invest in technology that delivers time savings, learn what you need to know about technology to make informed decisions, invest in your people (and yourself), and eliminate waste. Manage your practice for profit. If you’re profitable, you can afford to spend for growth.
- Organisational Innovation: Strive for a culture of creativity, innovation, ownership, challenge, and successful failure. Be a dynamic practice that attracts young, enthusiastic, vibrant, intelligent professionals to you. Finding and keeping quality professional staff is becoming more difficult. Innovation, challenge and fun are characteristics that are appealing to people even in the smallest firms. Demand these attributes of your people and provide them with the resources to deliver and contribute. Hire for attitude and educate for skill.
In all of my consulting work with accountants, lawyers, financial planners, recruiters and the like, I have never been witness to an organisation with unhappy, disgruntled, demotivated staff having happy and satisfied clients.
The horse that comes in first wins ten times the purse of the second place mount, but it need not run a perfect race and be five lengths in front of the other horses. Just a nose in front at the finishing post. Your accounting practice doesn’t have to be many times better than your competition. However, your existing and potential clients have to be able to recognise an incremental advantage of you over your competition that relates to a clear benefit for them.
Have a better understanding of your market and their needs. Have more visibility in places where your clients will be. Be more active in reaching out, sharing your knowledge, and growing your brand and repute. You just need to be a nose in front.
© Ric Willmot 2013. All rights reserved.
To learn more about growing a professional services firm, read Professional Services Marketing Wisdom: How to attract, acquire and retain clients even if you hate selling available on Amazon and in all good bookstores.