Accounting firm leadership continues to struggle with effective succession planning execution. There are many reasons for this, but the top two may be: (1) the number of retiring partners is far greater than the number of managers who are ready to assume a partnership role, and (2) many firms have not incorporated a growth culture into their day-to-day operations. To put it simply, many founding partners who are ready to retire didn’t give enough thought or attention to how the firm would continue to thrive after they left.
There were times over the last 20-plus years when firm leadership ramped up the development of their people. There also were times when work was so abundant due to regulatory changes and/or shifting economic conditions that training, business development and marketing took a back seat to fulfilling client work in a timely manner. The result is an inconsistent level of staff development across firms.
Consequently, many firm leaders are neither confident in the business development skills in their firms nor sure what to do about succession. Many wonder how they will replace the retiring partners who are their biggest rainmakers and handle most of the firm’s top client relationships. Time is a factor for many of these firms.
What Does It Mean to Have a Growth Culture?
The answer lies in having a robust growth culture. Let’s begin with what it means to build a growth culture. Merriam Webster defines culture as “the integrated pattern of human knowledge, belief and behavior that depends upon the capacity for learning and transmitting knowledge to succeeding generations.”
The last part of the definition is key. Nothing changes until firm leaders get serious about building a growth culture. The Rainmaker Companies recently conducted a survey on growth culture, and the results supported this premise. Of the nearly 250 firms that participated, three out of four are among the largest 300 firms in the nation. For the 69 percent of firms that grew more than 10 percent year-over-year, the growth was entirely organic. Many of these firms perceive that their strong growth culture helps them attract and retain talent as well as sustain the firm over the long term. Firms that invest in developing their people tend to continue to grow.
Some business development and marketing professionals have been preaching about the importance of having a growth culture for years, but firm leaders only start paying attention when they experience the anxiety and pain associated with being ill-equipped for succession execution.
Purposefully Building a Growth Culture
Most firms consistently selected three factors as having the highest impact on their firm’s growth culture:
- Recruiting, retaining and developing the right people
- Setting clear direction and strategy for the firm
- Holding people accountable for expected behaviors and results
Clearly setting and articulating expectations at every level, providing the right training, and supporting and remaining consistent with accountability and follow through will pay off immediately, as well as in the future when it comes to succession and sustainability.
Purposefully building a growth culture means committing to regularly and consistently training staff at all levels in business development and client service, regardless of level of client demands. Business development skills are imperative for all staff, from first-year associates to seasoned partners looking to retire. In order for a growth culture to be successful, the firm needs to make building a team of rainmakers a priority.
Rainmaking at Every Level
Even if you take succession out of the equation, today’s CPA firm professionals need to have the right business development and communication skills for developing new business and super-serving clients. This is not to say that every partner has to be able to bring in $500,000 of business per year or even $200,000; it is more about every partner having the desire (and ability) to expand relationships and uncover new opportunities for the firm.
High-growth firms are more likely to back up their missions and visions with clear marketing, sales and client expansion plans, the Rainmaker survey found. What better way to do this than to set expectations for professionals at every level and begin to involve them in growth strategies?
It is a mistake to only focus on technical training for a period of time before investing in soft skills training. While technical ability is a non-negotiable in most positions, communication skills are equally critical. First-year staff should be taught how to position themselves internally as trusted advisors so they can begin setting themselves up for direct client contact. They should be focusing on building their brand and expertise from the beginning. Waiting to invest in this level of employee is nonsense. Start earlier and never stop investing in your people.
Managers and senior managers should be ramping up their activities around building a network of centers of influence and referral sources. They should be attending client meetings, learning how to target firm prospects and understanding how to ask the right questions. They should be seeing results that will catapult them into partnership.
New partners should have already built these activities into the rhythm of their days and weeks. Partners should not be off the hook when it comes to developing their skills. They should be consistently raising the bar in their rainmaking abilities. They should also be required to help develop younger professionals.