Symptoms of Sickness in a CPA Firm

Source: Public Practice 

Here are six symptoms of sickness:

1. Weakness in or lack of strategy. If you don’t know when you should decline the opportunity to merge or open a new office, you don’t have a strategy. 

2. Lack of urgency. You cannot be complacent about your perceived level of success. It will put you behind the best firms. Firms with a true sense of urgency eschew endless meetings and focus on getting things done..

3. Slow decision-making. Lack of trust in partners may cause delays in making decisions. Is there clarity as to who really makes decisions? Leaders should either make decisions based on input from partners or empower others to make decisions.

4. Lack of accountability. Accountability does not mean subservience. Partners must have goals and be accountable for achieving them. Accountability applies equally to the firm’s leadership as it does to employees. If you expect others to be accountable, be a role model.

5. Ineffective execution of the strategic plan. Responsibility for execution of the strategic plan starts at the top. The CEO sets the direction and delegates to other leaders. They in turn must truly believe in the firm’s direction. These leaders should be accountable to the firm for their progress. 

6. Compensation not aligned. The firm should identify strategic objectives and determine whether compensation is aligned with them. Base salary may not be related to achievement of firm-wide strategic goals, but bonuses and other kinds of compensation may well be. For example, an equity position may be conferred on people who contribute to the achievement of certain goals. 

Start at the top of the list. Vision should drive everything. Then work on creating a sense of urgency throughout the firm. And never stop looking for all these symptoms.

For the original article, read “Firm Malaise — Here's a New Prescription.” 

From Public Practice, Texas Society of CPAs, February 2018, www.tscpa.org.