Everything’s Changed. But Has It?
Reprinted with permission from Accounting Today
You know it’s a good roundtable discussion when you come away feeling that you’ve learned as much as you’ve shared. That was my takeaway from the virtual sessions I recently participated in along with Angie Grissom and Allan Koltin. We were joined by hundreds of managing partners and firm leaders. While dynamic markets have presented us with a new reality, I stressed in my remarks that the fundamental principles of firm growth still apply.
For those of you who were unable to join us, here is an edited version of questions posed to me during the roundtables.
Q. Gale, what’s the anticipated revenue impact on firms due to recent events?
Great question. Asked if they anticipate a drop in their firm’s revenue over the next many months, about 75 percent of respondents to a recent Accounting Today survey said yes. For those of us in the glass-half-full camp, that means a full quarter of your colleagues are optimistic about the future. Revenue decline is in no way a foregone conclusion.
Q. You talk about market disruptions in terms of four “thunderbolts.” What are these, and which are we experiencing now?
Significant market shifts are linked to one or more of four types of disruption—competition, technology, regulation and/or a change in economic conditions. Mid-market CPA firms have already been hit by the competition thunderbolt. And in the last several years, the technology thunderbolt hit. We’re currently being buffeted by a sea change in economic conditions, which has led to an abundance of regulatory changes and interpretations. It’s hard to imagine a more dynamic market than this one!
Q. How should we adjust our growth strategy in light of the tsunami that’s hit the economy?
Certainly, a great deal has changed in recent months. But when it comes to growth, I recommend firms stay focused on changes to the three elements of growth strategy: (1) your services, the size, shape and packaging of what buyers want now, (2) your buyer group and its attributes and (3) distribution channels, how you and buyers find each other in great quantities.
Have these changed, and if so, how? How do we realign our interests with current or new channels?
Picture a growth strategy as a combination lock with each of the numbers relating to each of the three growth elements. The numbers are highly specific, and when used in the right combination, they unlock the strategy safe, leading to firm growth.
Q. I think I know what my clients need. But can you suggest a tool or tactic for getting this essential insight?
You need to get from “I think I know” to “I know that I know.” Otherwise, it’s (no offense) a matter of “Your Opinion While Interesting Is Irrelevant,” or YOWIII. The tool, known as the Research Call,SM is the best way I know to nail what buyers need and are willing to pay for, today and in the future. A Research Call (via Zoom, Google Meet, phone, etc.) puts you directly in touch with clients, prospects, competitors, thought leaders and other providers who swim in your ecosystem. The key is to learn all you can and pivot your strategy quickly to provide the needs revealed by the calls.
Imagine you’re selling bottled water to travelers who pass your water stand on their way to the desert. Life is wonderful until a deluge hits. Research Calls reveal that those who needed bottled water desperately last week, now urgently need rain gear, water-collection containers and boots. As a result, you shift your growth strategy to a more relevant offering. If you’re able to innovate and respond, you’ll solve your buyer’s problem and become the hero. But you have to get out there and ask. What kind of rain gear? What size collection containers? How much will buyers pay? You get the picture.
Q. Could you talk about the evolution from one-off problem solver to innovator?
The strategic imperative during market disruption is innovation. Effective innovation starts with Research Calls, which reveal what services are interesting now, and will be in the near future. PPP leads to forgiveness consulting. But what happens next? Perhaps cashflow analysis, financial projections, strategic planning facilitation, data analytics, transaction services such as M&A and bankruptcy, and cloud-driven technology needs, including cybersecurity. As well, your buyer groups could shift, as banks and other organizations grapple with new needs.
Take this opportunity to learn how to package and describe services to drive consistency, efficiency and revenue. That means making the transition from an idea, to a concept and a written service design. From there, craft a selling script for partners and a brief description of the business problem, noting features, advantages and benefits. Use this with early adopters and other prospects. Once you land clients, your engagement letter message can flow from the communications work you’ve done thus far.
It’s still quite unsettled out there, but if you look up you’ll see patches of blue among the clouds. Keep your eye on the prize—firm growth—and use growth strategies and innovation, to achieve it.