Developing Future Leaders—Advice from a Managing Director

Source: CPA Practice Management Forum

Donald Cowan is managing director of Cowan, Gunteski & Co. in Toms River, NJ. Here are some highlights from his practical advice on developing future leaders:

• Define leader. In Cowan’s firm a leader:
  • Is compatible with the firm’s culture.
  • Is passionate.
  • Takes initiative.
  • Is accountable.
• Soft skills are possibly more crucial than technical skills.
• Train your people in developing referrals through networking, and in dealing with clients on a relationship level. Start this early. It’s too late to start when they’ve reached the manager level.
• Create a formal mentoring program. Mentors should meet regularly with their protégés and work from an agenda. The two should volunteer to work with each other. It should not be an assigned project.
• A training program for future partners should include:
  • How to manage a client base.
  • How to develop good relationships with clients.
  • Developing referral relationships.
  • Dealing with conflict.
  • Involvement in the community.

Deal with the financial side of succession. In general a firm should not pay retired partners more than six to eight percent of gross revenue per year. The partner agreement should place a limit on the total payout. This is particularly critical when more than one partner will likely retire around the same time. Partners should be required to give at least two years’ notice before retiring and should be penalized if they do not.

Begin training successors three years before planned retirement. Introduce them to the most important clients in the first year and to the others in the second. By the third year they should begin assuming full control of the relationship. Transition planning should be a factor in calculating partner compensation.

For the complete article, click here.

From CPA Practice Management Forum, CCH Incorporated, 800-449-8114, February 2008, p. 13.

Measuring CPA Leadership Effectiveness

Full Service Real Estate Investment and Mortgage Finance.