Strategic Planning—Plan for a Reduction in Demand for Accounting Services

Source: Accounting Office Management & Administration Report

At the AICPA Practitioners Symposium, L. Gary Boomer (www.boomer.com) identified planning as the best path to success in a dynamic marketplace. There is no assurance that today’s demand for accounting services will automatically perpetuate itself.

Boomer believes firms should eschew billable hours in favor of value-billing (otherwise accounting services may become commodities). Firms should focus on analytical services, forecasts, helping clients plan, specialization, using the Internet, small business advisory services, and portals for clients.

As part of the planning process, firms should form teams for:

• Innovation.
• Revenue and growth.
• Graphics.
• Communication through writing.
• Firm management.
• Production.
• Risk management.

Preparing the plan is only one part of the process. Reviewing and monitoring are critical. Metrics are part of the review process. Important measures include average billing rates, percentage of time billed, technology investment per billed hour and as a percentage of revenue, and revenue per full-time employee.

A useful resource for help in planning and execution is The American Bar Association’s The Lawyer’s Guide to Strategic Planning: Defining, Setting, and Achieving Your Firm’s Goals, by Thomas Grella and Michael Hudkins. (Call the ABA service center at 800-285-2221 for purchase information.) This book gives the following advice on the follow-up phase of planning:

• Success depends on leaders’ effectiveness at monitoring.
• Partners should meet to review progress on the plan.
• There must be:
  • Agreement on where the firm is headed and whether the vision is a valid reflection of what partners want.
  • Continuing affirmation of the firm’s mission including:
    • Identification of what the firm is and what it wants to become.
    • Characteristics of the client base.
    • Identification of competitors.
    • How the firm will get where it wants to go.

From Accounting Office Management & Administration Report, May 2007, p. 1. For subscription information contact Institute of Management & Administration, Inc., 3 Park Avenue, 30th Floor, New York, NY 10016-5902. One-year subscription $399. 212-244-0360, [email protected]. For the complete article click here.