Speaker 1: 0:05

This is Accounts 2.0. I'm Steve Perbich, and with me is our president, ted Williamson. How are you doing today, ted?

Speaker 2: 0:12

Great Thanks. We just got scolded by our outsourced team on how horrible our backgrounds were.

Speaker 1: 0:22

Yes, we're working on our backgrounds and also it's how you're lighting is so light. You might want to adjust that lighting there.

Speaker 2: 0:31

But, as you know, if you watch step three, our microphones are closer to us, yes, so we're looking a little more professional so let everybody know Steve and I are very, very new at doing podcasts, so we actually appreciate the help from our internal and our outside team. It's very, very helpful, so it's awesome.

Speaker 1: 0:52

Well, I'm used to just audio only, so what was going on in the background it didn't matter, as long as the sound was good. We were good because most of the podcasts I've done over the last few decades or so have just been audio. So you get to see me now folks. Hey, welcome. So today, step four in New Age Accounting if a process can't scale, change the process. So in the first steps we talk about making that technology assessment, getting the right technology in place, getting the right people in place, getting the right client philosophy in place, making them the center of everything.

Speaker 1: 1:32

But what I have found in my years of consulting for systems, processes are embedded in organizations. Usually we've always done it this way. I've never I always cringe, never liked that statement always done it this way. But if you know you're hiring me as a consultant, then you're looking to increase efficiencies and scaling. There must be something wrong and it's, you know, not just technology, it's not just the people and it's not just the customer. It's never the customer. It is, unless you're selecting the wrong customers.

Speaker 1: 2:04

It is your processes and really, right off the bat, it's an assessment of your current processes to deliver the service and also the capacity that you have. Are you sure you can even meet the demands of with your current process flow? And that's the first step of process optimization is know the limits, know where you're at, know your resources and then you can take. The next steps would be identify those inefficiencies. All right, so all right. We only got so many people, we only have so many hours. We're not tacking on new things without an assessment. But then what? What is going on now? That's just can be improved and that's almost like a corporate culture thing, don't you think?

Speaker 2: 2:59

for Ted, I think so I mean you need a constant, continuous improvement. You need to look at your standard operating procedures. You know you need to update those SOPs often, look at them all the time. As soon as something changes with a supplier, for example, or, you know, with with regulation, look at your SOPs and see what relates to it and then update it and then try to build all those things into a more easy to manage system.

Speaker 2: 3:34

So for us, we used we use financial sense actually, which was a practice management software. So we would use that in combination with with workplace by meta, and workplace by meta would be all where all of our SOPs were, and then financial sense would be where we would actually perform our SOPs and actually have our checklists and our client reminders and all that kind of stuff. And and by linking our meta SOPs in our financial sense, in the actual workflows itself, we could update the SOP regardless, you know, and not have to update every single workflow, every single client, stuff like that. So, so it doesn't have to be hard. You know it can, it can be. I mean it's not, it's never easy, but it shouldn't be because you're there to provide a service and and a really good service. I shouldn't say it shouldn't be easy, but but make it as easy as possible, but don't expect it to be. You know, just do it on one day. One day I will get us there.

Speaker 1: 4:44

One philosophy I like to have is you need a process to put in your processes.

Speaker 2: 4:49

So yes, you need a process.

Speaker 1: 4:50

And another concept of that is and we spoke earlier about the client centered philosophy is you have to stick to your core products.

Speaker 1: 5:03

Your core products and their delivery should have the processes baked into how your team deals with that day to day. What usually happens is again we get back to that fundamental, afraid to say no and not operating within your niche. So you have these extra little steps you keep adding as workarounds and then they become entity unto themselves and then you will have staff members who will start making a career out of just doing these exceptional processes. And then you're in run the risk of perceived indispensability of that staff member because now they're doing something that no one else can really do and there's a whole bunch of issues there. So whenever you're bringing on a new process, you really have to do that examination of is this our core competency? Does this require extra resources? Don't just add a new process and expect your resources to automatically, you know, create time out of thin air to do all this stuff. So there's quite a cycle. So again, a process to implement processes.

Speaker 2: 6:17

Yeah, I think I'll reiterate, like the importance on niching. So, first of all, finding your ideal client and making sure that all of your ideal clients are similar in a way, and then all and then the actual work that you do is similar for each of those similar clients and you're not giving them all kinds of customization. You have a process in place for the specific service, for the specific client and you're not gonna get inundated with processes and changing and or processes Sorry, you know that's the Canadian, I mean it comes out with a process, but I recently was told that by somebody in Michigan. So but, but yeah, just make sure that you're focusing who your client is, what it is that you're offering. That should drive your process, that that should really drive your process, and then you can create the process on updating those processes.

Speaker 1: 7:24

So, yeah, and to to belabor the use of the word process yeah, yeah, wherever you wish to pronounce it.

Speaker 1: 7:34

We should just call this this episode process process process or process or process People are probably sick of us talking about it right now, but yeah, the thing is, adding any process should be a big deal. Okay, you don't just come up with new SOPs every afternoon because of variance in something has happened. There shouldn't be variance. You're running an accounting firm. You should have your niches picked, your product line is established, your staff selected and then then you actually have and I'm gonna be a little aggressive here a snowball's chance in hell of actually managing change.

Speaker 1: 8:13

So if you're not having, if you don't have defined processes and you kind of just winging it and you know what you're doing because you've always done it that way, I mean you know this is the date to file this, this is what I got to do this for this client. Well, any curve is gonna create added workload and that's just gonna stress your system, and then you're gonna have problems with staff retention, customer retention and all those terrible things. That will not help you scale. And we're about scaling and having excellent life and living an accounts 2.0 lifestyle, and that's hard to do when you're fighting fires all the time because you don't manage your process.

Speaker 2: 8:50

Yeah, so so, yeah, this actually isn't about processes and processes, it's actually about scaling and so so. So you did mention that. So I do want to actually address that, because some people don't aren't as ambitious as you and I, so some people don't want to scale.

Speaker 1: 9:07

The nation is not this podcast. We don't want to, we don't want to.

Speaker 2: 9:10

No, no, that's not true, that's not true, we want to help everybody because, regardless of whether or not you want to scale, maintaining and and managing quality in what we just talked about is still important, regardless of whether some people just don't want to deal with the hassles of scaling and and finding a whole bunch of clientele's figuring out their capacity measurements, all kinds of stuff. Some people don't want that, and that's fine, so they don't. Not everybody has to have that, not everybody's as ambitious and as entrepreneurial, which is perfectly fine. But for those who are entrepreneurial, this definitely is more towards you. But anybody can benefit from this conversation really. But scaling you're not going to do without your pros, without your processes in place. Not just that, but even if you're not into scaling Also, you're one day going to want to exit your firm and so if you're going to, you know who wants to buy one it doesn't have all that in place who is just going to be kind of thrown in Like so a big.

Speaker 2: 10:25

You know, a big part of why our firm exited and exited pretty well was because we had a bunch of processes in place. We unfortunately, like, specifically, the person that we exited from wasn't as introduced to those processes, or I mean to the technology and stuff like that, and so the onboarding was a little bit shaky and that's another conversation we'll have for another time is that, you know, that exchange of your firm later on when you want to exit? And that's not his fault and it's not our fault, it just was what it was. We didn't have a perfect marrying, but aside from that, it was still great. It was still a great exit, and not having that stuff in place would have made it so much worse. Understanding how to run a company and the services is super, super important, and if somebody is going to come in and they're going to have to revamp everything all from day one, they're not going to want to buy it. So make sure you pay attention and you build it to scale regardless.

Speaker 2: 11:36

Now I do want to talk about there's different ways of doing that. So most of what we're talking about here is focusing on your balance sheet. So focusing on on, like your staff, focusing on on how we're going to build things. You know, in preparation of scaling, where there is actually a method out there, you know this is based on profit, is that focus on profit and then and then build behind that profit Now?

Speaker 2: 12:03

So I mean none of them are wrong, but I don't like the idea of chasing, of putting out fires and chasing, not that that's going. That would be the case If you if you select your client very, your client very well, and then your service is very well, you shouldn't have that case as much. But and it should be an easy, easy to get to to build all that stuff in place for you to scale so you can focus on profit first. But it really really depends Most of what we're talking about here is on the balance sheet and preparation for scale, though that's right. So I kind of went on a tangent and just kind of wanted to get, just just get it all out there.

Speaker 1: 12:40

But it keeps back to we have no concept of what individual firms processes other than you know high level understanding of business process and business process and accounting process itself. Each client relationship, each niche that's being served in and product bundle or offering is going to have its own itinerant processes and then the team has to execute them. But again, to make that smooth, it is a corporate culture thing, the there's constant need for constant assessment, constant assessment for efficiency and a capacity to change and to update Again process to update the process.

Speaker 1: 13:27

It can't be stressed enough and and and again it is, the change will be constant, but change can be managed and whether you're scaling or not and I can't comprehend not scaling, but okay, If you wish to just have a defined parameter to operate in the world is going to impose variables upon you. No matter how well laid you think your plans are, or how rigid and how set your client base is and your region, there will be variables imposed upon you. Process will have to be modified. So that's this. This is valid.

Speaker 2: 14:05

Absolutely.

Speaker 1: 14:06

And again, perhaps if your process is online, the concept of scaling won't be so alien to you and might encourage so yeah, or you might, you might get a spitfire coming into the firm.

Speaker 2: 14:17

That's like, like I want to. I want to start skilling this and you're like, okay, you do it, but as long as everything's put in place, I'll let it happen. You know, you never know. And then all of a sudden you're making a bunch more money for you know, and you didn't have to do that much Like, why wouldn't you want to do anyway?

Speaker 1: 14:34

Yes, exactly, you don't want to make one.

Speaker 2: 14:36

Yeah, everybody's different, everybody's different.

Speaker 1: 14:37

Like oh kind of account doesn't want to account, like you know. See the profit line.

Speaker 2: 14:41

Anyways, whatever, and capital gain?

Speaker 1: 14:44

I don't know, just call me crazy.

Speaker 2: 14:47

Yeah, yeah, but there we have it. So let's talk about, I guess, managing that scale. We're talking about how to, you know, build it in. But let's talk about a little bit about, I think, the technology. So I'm going to talk about a little bit.

Speaker 2: 15:06

I already talked about practice management software, so, and then everybody knows there's all kinds of different software out there for different reasons. So we did more bookkeeping and tax, but there's lots of other ones out there, you know, and especially for year ends, like I've mentioned, countable before, which is great, it's a case where everybody knows that's. That was the standard for the longest time, until countable came, in my opinion, but whatever, even though they're not there yet on it, but they will be. But other other things is like dealing with the client.

Speaker 2: 15:44

Communication also also changes your ability to scale, because if you're constantly taking, you know, if you're taking information from clients, all these different areas, and there's not a way to unify all those communications, you're really going to have many people touching that communication or many people touching communications that they don't need to in order to figure, to make sure that things aren't. You know, the sky's not going to fall right, so because all of a sudden they come with a concern and you know Jim and Julie are looking in two different places, but you should only have one person looking in one place, so I don't know. I think that that also hurts your ability to scale, not just on managing the work but also communicating with the clients and the internal staff.

Speaker 1: 16:38

So unify communication channel? Absolutely. It's what's critical. Absolutely, absolutely. Another thing you touched on dead succession planning.

Speaker 1: 16:48

Without firm processes, it's not just an evaluation or moving on selling the company, handing the company down to or moving it to other family members or other entities If these processes are not well-defined or maintained in a capacity to change them. And this opens the door to yet another professional that you may want to consider. There are consultants out there that are especially as documenting, process and process advisement. It's not an inexpensive project, but I have come across two really talented consultants over time and usually there's a right moment for that. You're going to go through a massive change, either through succession or sale, and it is worth considering having that evaluated. The other is you have staff changes that are significant and it's an opportunity, but again, it's another avenue to pursue that if you feel your processes are either unchangeable or stuck, there are professionals out there and they will work in a narrow band. You don't necessarily have to go the whole company. They can say, okay, this set of tasks, I need it to be made more efficient and they're specialists, so they're out there.

Speaker 2: 18:20

Yeah, and you know specifically, we're actually kind of lucky in the accounting industry Specifically, there are quite a few coaches. I'm not saying that they're all good, but I'm not saying that they're all bad. They're definitely not. There's a lot of really good coaches in the accounting industry. I actually use one of Australia, there's one in Canada here, there's a couple in Canada, there's a bunch all over the place. They're international because they just look at how do you scale basically what we're talking about. So think of this as an introductory to coaching. There you go, then any coaches that want to jump on, maybe they can jump onto a podcast and help us out. But we're not coaches, but we just talk about our experience and topics where entertainment purposes, not advisory.

Speaker 1: 19:09

So we should put that disclaimer in. I guess, Community.

Speaker 2: 19:15

Yeah, so put a disclaimer in there. We are not advisors or coaches. We're just talking about our experience, what we found in the marketplace. But coaches dig into this a lot. That's where I came down with the profit. Everybody knows the profit first, so it's not necessarily on accounting industry, but in general.

Speaker 2: 19:37

So that's a good methodology for valuing and looking at your company and how you're going to scale and grow. There's other ones, so there's the value builder model. There's all kinds of different things. You can go to these people and they have some of them are very, very affordable because they want you to do that coaching or that advisory and add it onto your product stack, which you can do at a very, very simple way. In a lot of cases you can utilize them and you can actually start doing that for your clients too.

Speaker 2: 20:20

But in order for yourself to scale, I actually would advise finding a coach or somebody to look at, to lift up the hood and look inside and then maybe have an occasional peak again. So I would think about that. I didn't get too deep into that and, looking back, I probably would have made a lot more money if I did so. Just to give you a little advice there. So we look at my experience a lot, and it's not because I think I'm the most successful new age accountant out there or anything, but I've seen a lot of stuff and I've done a lot of stuff and we're a community and it's not just about me, it's just that I'm just happy to be the one talking on this microphone, but we're a community.

Speaker 2: 21:15

So I'd love to hear more about what you're doing to improve your business so that you can scale, so that you can simplify the way that you operate your business. How are you maintaining that? Are you using a coach? And if you are, you know in the comments which coach are you using to help help other people? There's coaches for all kinds of stuff marketing, you know everything.

Speaker 1: 21:41

So so, wherever you're experiencing this, this podcast, either through audio or on youtube or facebook or linkedin Leave comments, join our community and get involved. We will respond. We like to respond and and it helps helps give us more material for keeping this conversation going. Ted, you have anything else to add because I'm about to wrap it up here.

Speaker 2: 22:11

I know it because it, because every time you go to wrap it up I keep jumping. I'm like, hey, and one more thing. I'm sorry, but I think I'm gonna let you wrap it up then.

Speaker 1: 22:23

Fantastic everyone. I'm Steve Perpich. This is Ted Williamson, president of counts two, point oh, and you are listening to or watching. Thank you everyone. Have a great day.