CPA Firm Strategies for the New Normal
The COVID-19 pandemic has forced many changes in the accounting industry and its clients. Some of these changes were ad hoc, temporary, and unpolished, and unfortunately, we will need to continuously address the effects of the pandemic for quite some time. We need to determine the best way to continue doing business and adapt quickly to changes in the office work environment, in the economy and with our clients. It is time for accounting firms to polish their solutions and adapt strategy, operations, and culture to ensure the future and long-term success of their practices.
How can CPA firm Partners strategize and plan for an unpredictable future while dealing with the urgent demands of the present from clients and staff? This is a big challenge.
During these unprecedented times, it is difficult to predict the future. Thus, leadership should focus on planning for various options based upon as many possible scenarios as possible. This type of planning explores plausible potential business models and implementation processes for impending unknowns.
Planning for potential forthcoming scenarios and developing action plans for each is critical. Examples of possible scenarios are:
The COVID-19 pandemic continues with high infection rates into 2021/22 until either herd immunity or a vaccine reduces the spread. The economy is more severely damaged than initially predicted.
COVID-19 cases reduce sooner than expected, and the economy bounces back strong in 2021.
Other scenarios between numbers one and two above are possible. Accounting firms should plan for another year or two of disruption, at a minimum.
Regardless of the above, many staff members do not feel safe about returning to the office and using public transportation to commute to the office thus maintaining a remote workforce
Remote Work: The “New Normal' Office
While technology has made staff more efficient and accessible than ever before, in the past, many firms had been slow to allow staff to work remotely. The current crisis has forced firms to think differently about working remotely and has given rise to the following benefits:
Commutes can be eliminated and replaced with productive/billable time
Office space and related costs can be reduced
Office hours can be flexible
Additional cost savings to make office space CDC and local government compliant
Firms can hire the best talent, no matter where they live, and reduce turnover
Meetings can be more focused and efficient
Staff can move to lower-cost areas and live closer to their families establishing a higher rate of retention and staff satisfaction
However, there are issues and challenges to consider:
Remote work is not for everyone
Managing staff remotely, including production, scheduling, workflow management, and accountability
Distractions come with the territory of a home office
Communicating with staff more often and effectively
Staff can feel isolated, and there can be dips in morale
Purchasing and maintaining adequate technology and equipment
Keeping company culture intact while working remotely
Onboarding and training entry-level staff
Career development and advancement may be more difficult
New Needs, New Services
The COVID-19 pandemic has brought about a new business world. All companies are now operating in a new business environment with different needs, challenges, and obstacles.
Consider offering these timely and relevant services to offer clients and the marketplace:
Assist banks to determine if their clients' loans meet the government criteria for forgiveness
Restructuring debt and other obligations
Bankruptcy structuring and advisory services
Outsourced CFO, Controller, and accounting/bookkeeping services
Outsourced family office and personal financial business management services
Pre-audit preparation services
Risk management services
Business interruption and other insurance claims
Cost containment initiatives
Near-term cash flow budgets and working capital requirements
Amend prior-year tax returns to reflect changes to the net operating loss rules
Cybersecurity technology services
Marketing and Sales
Now is the time to expand marketing and sales initiatives while many firms have cut back on practice development. Continuously generate more intensive online and digital marketing campaigns to attract new clients, including:
Relevant thought leadership via blogs, email campaigns, and social media
Webinars
Podcasts
Videos
Announcing and promoting new and innovative COVID-19 and recession-related services
Government and loan forgiveness updates and advisory
Remote Work is Transforming Organizational Culture
Now is the time to consider how to make your digital workplace function at its best, what aspects of your culture and operations need to adapt, how those adaptations will be implemented, and what changes may stay with us after the worst of the crisis passes. Good or bad, the habits and norms you create now will shape your organization and its culture for years to come. Remote work is not going away anytime soon, and as it continues to grow, partners and staff must learn how to work with remote teams to build and sustain a positive remote working culture. Additionally, new staff members will have a very different experience than those who had an opportunity to work closely and get to know each other in the office pre-COVID. Partners will have to be ‘new normal’ type leaders and role models, communicate more effectively with staff even on a personal level, and collaborate to keep the firm’s positive culture aspects alive and deal with the negative aspects quickly. The questions to address and deal with ASAP are:
What aspects of the Firm's positive culture can be sustained?
What aspects of the Firm's culture need to change?
How often do partners and firm leaders need to communicate with staff on a business and personal level?
How can new staff members be introduced and welcomed into the culture as they work remotely?
Does the Firm's budget need to be adjusted or reallocated toward new culture initiatives?
Do we need to designate someone in HR or in another position to oversee both the internal and remote cultures and advise firm leaders on the status and recommended changes to be made?
A great deal of all this new plan must involve discussions with partners, staff, and clients. Make the changes clear by publishing and communicating them. Be prepared to adjust and pivot if some of the changes are not working out. The CPA firms that will succeed in doing business in the new world are the ones that are the most agile and adaptable to change.
It is not the strongest of the species that survives, nor the most intelligent that survives. It is the one that is the most adaptable to change. – Charles Darwin
Joe Tarasco, CEO and Senior Consultant, Accountants Advisory Group, LLC, assists the leaders of public accounting firms by consulting in all areas of firm practice management, including succession and strategic planning, firm governance, mergers and acquisitions, partner compensation structure, practice development, facilitating partner retreats, and leadership consulting. He can be reached at joe@accountantsadvisory.com.