Author’s note: This is the third article in the series Lean Times in which Gale Crosley delivers solid guidance for the business discipline of practice growth in a changed environment.
May you live in interesting times.” Purportedly a Chinese curse, this proverb cleanly describes today’s accounting marketplace. Not long ago, small to mid-size firms were awash in business – meaty chunks that broke off as the Big Four were conflicted out of various services as a result of Sarbanes Oxley. Today, a similar phenomenon is occurring. But the impetus is economic, not regulatory.
Can You Say ‘Value?’
Companies are taking an Exacto knife to all aspects of their operations, and financial services are no exception. From ERISA plan audits to standard audits and tax, businesses are looking critically at the cost and value of these bread-and-butter services. Many are concluding that mid-market firms can provide overall quality, while offering high-value niche expertise, all at an attractive cost.
As a result, I’ve been engaged in a flurry of large-opportunity coaching in recent months. The good news is that our efforts are yielding big wins.
At the same time, large CPA firms are repricing in order to demonstrate their ability to respond to clients’ needs in tough times. Certainly, this adds to the challenge of attracting up market work. But believe me, loads of opportunities are out there, many with your name on them.
Welcome Business Developers!
Accompanying this market shift is a growing acceptance of business developers (BDs) at mid-size firms. For years I’ve been urging clients to hire the best salespeople they can. But business conditions have been so flush that it’s been easy to ignore this advice.
But now partners, even capable rainmakers, are acknowledging the need and are turning to professionals with very good results. My clients’ experiences prove that one of the surest ways to attract business formerly held by large firms is to sign on a BD skilled in assessing opportunities and crafting winnable strategies. It’s a straightforward and powerful business proposition: BDs typically pay for themselves after the first year and can land annuity work with exponential revenue potential over time.
What’s more, business developers represent a direct return on investment. Unlike slick marketing brochures or branding campaigns, this type of investment is easy to monitor. As well, business developers are compensated not for their effort, but for their results. There’s no complicated calculus; they either land the business or they don’t. What should you consider when hiring?
- Find a business developer whose profile is most closely aligned with your firm’s culture and niche specialties.
- Design the job for success, including the right set of expectations and a compensation plan that will motivate the business developer.
- Educate your shareholders to understand specifically how they will interface with the BD and their role in ensuring his or her success.
The Best of Times?
With due respect to Mr. Dickens, I’m not (yet) prepared to suggest that these are the “best of times” for CPAs. But I sincerely believe that it’s possible to leverage today’s lean environment to impressive advantage.
Combine the fact that large businesses are looking down-market for firms to affordably supply quality services with the strategic benefits of a business developer, and you’ve got the makings of a very good year.