Why 1000's of firms are considering a change in business model

In my last email, I addressed the question “Is the accounting industry complacent and that’s causing them to ignore a huge opportunity?”, and how the majority of firms are just not stepping up and leading our industry, therefore clients are looking outside the industry for services accountants should be doing.

In this email, I am going to address “why 1000’s of firms are considering a change in business model” in order to fast track growth.

Speaking with hundreds of partners of multi-parter firms, they have shared many problems in the transition to offering value add services. Most have admitted the main one is the challenge of where to find the time to do the work, as their people are already busy doing compliance and advising clients on daily transactional matters. What’s happening is firms are using the compliance model the industry was built on and trying to add value-add services on top. It’s just not working, “doing consultancy on top of compliance work” is leading to;

No consistency of deliver

Each partner does it their own way, therefore, there is no consistency of delivery
Most admitted to recreating process each time they took on a new project
And everyone said they had experienced scope creep due to the above two delivery problems

Hard to delegate and train

In their experience, it has just made the best people even busier
And without a consistency of delivery, it is impossible to know where to start the training and who to train on what

Loses momentum depending on the seasonal workload

With clients demanding more general advice, consultancy is getting put second behind compliance
Then to save time, many are holding dual meetings (compliance and consulting in the same meeting) and,
This is causing clients to become confused and disengaged, leading to them questioning the true value of consulting

These problems are really the symptoms of more entrench Deeper Problems;

Fee growth is stalling as partners are struggling to leverage the value add services and running into capacity issues
They admit and know they are not extracting the real value (price) they should because clients are not valuing it as high as the returns they are receiving
The best people are becoming disengaged and frustrated as they are exhausted trying to be all things to all people

So, what’s causing this

lack of internal focus, Business advisory/ consulting work is not getting the true focus and energy it needs to be successful,
The traditional compliance business model producer’s general advisors, not experts,
Clients are pushing the industry because they now want different outcomes from their accountant, therefore accountants are playing catch-up to keep them happy

These causes are directly linked to the structure set up, the traditional compliance business model, all accounting firms were built on and the reason why accountants as struggling to meet client needs and wants and finding their firms not as profitable as they should be.

TwentySix Group Business Accelerator Session

A one-on-one Online discussion that identifies the drivers that will determine your one critical decision, which model is right for your Firm of Tomorrow. Facilitating this process, it is important that you and your partners understand how your firm sits in the market now and how it should sit in the future. Even more critical is to know, how clients will determine the value to them and their business. You will walk away with a plan on how to bridge that gap that exists between where you are now and your desired firm of tomorrow.