CPA.com Blog

Erik Asgeirsson

President & CEO, CPA.com

A San Francisco Treat: DCPA 2017 Takeaways

After I gave my keynote on the final day of the Digital CPA Conference last week, I had a chance to take a moment and look out at the crowd in the San Francisco Marriott Marquis conference center.  And what hit home to me was just how far we’ve come as a community in the past five years.

The first Digital CPA was scheduled to be held Oct. 28-30, 2012, in a hotel with an impressive all-glass lobby just outside of Washington, D.C. Some of you may remember those dates as the East Coast landfall for Hurricane Sandy. We postponed the conference until December, and were grateful most people tore up their busy schedules and showed up. We had a tight-knit group from the beginning.

Now it’s 2017, and many of the practitioners at this year’s event have played a key role in the fast growth of virtual CFO services and the reinvention of client accounting services. And many of these same lessons learned are now being applied to new opportunities emerging in audit and tax. We’re poised for big things in the profession, and Digital CPA – with its energy, enthusiasm and vibrant setting – was a great reflection of that potential.

Here’s some of my takeaways from the conference:

We have a big tent, and it’s getting bigger all the time. We had 430 people at Digital CPA this year, and another 40 connecting remotely. We had more than two dozen people flying in from five different countries outside of the United States, so the strength of the programming, like the challenges and opportunities it addresses, extends across many borders. That’s a lot of momentum, and I want to thank all of you who have helped build this community from the ground up.

The pace of change offers great opportunity. Technology is rapidly transforming the practice of accounting, and all of the discussions at the event made me feel even stronger that there has never been a better opportunity for CPA firms to grow and thrive.

Complementary skills are going to be more important than ever going forward. AICPA Chairman Kimberly Ellison-Taylor talked about this during my Digital CPA keynote, and it was underscored in conference sessions. Technical skills and good judgment are never going to go out of style, but CPAs are going to need expertise in communications, technology and marketing, among other areas, if they’re going to successfully establish high-value advisory practices.

Mistakes and failure aren’t fatal – they’re prerequisites to growth and innovation. This was one of the lessons from Netflix co-founder Marc Randolph’s fantastic presentation. Not everything works out. As a profession, we’re devoted to service quality, and that’s always the goal. But we can’t be afraid to move fast to try something, and move on if it’s clear an approach isn’t working.

Education will move us forward. Blockchain will bring huge changes to the audit, in ways that aren’t fully clear yet. Digital CPA attendees have a high curiosity about this area. This is why we teamed up with the Wall Street Blockchain Alliance this past fall, and why we’re committed to providing context and insight to CPAs on this topic. There’s a whole new world forming in finance and accounting, thanks to blockchain, artificial intelligence, machine learning and data analytics. At CPA.com, it’s our mission to provide thought leadership and guidance for firms navigating these changes. We’ll be here for you.

And if you missed this year’s conference but are curious about next year, check back at digitalcpa.com for updates. We’ll be in Washington, D.C. again from Dec. 3-5, 2018.

Samantha Mansfield

Director of Professional Development & Community, CPA.com

Taking the Lead Through Anticipation

“When rapid change happens you have to anticipate more.” – Joey Havens, CPA

Wise words and so true, but easier said than done if you haven’t practiced the skill of anticipation.

In a recent Digital CPA Webcast, we discussed the importance of developing the competency of anticipation. Not the feeling, we learn that at a very young age, but the action of preparing for the future; we have to filter through all the data and changes happening daily to get to the future facts. Future facts are what Daniel Burrus, futurist, calls hard trends; we know these things will happen, such as increased bandwidth, further automation, faster processing, etc. Instead of getting bogged down with soft trends, which Burrus describes as assumptions, we need to zero in on the hard trends that will impact our future.

Questions Burrus encourages you to consider:

  1. Are you considering relevancy?
  2. Are you thinking big enough?
  3. Are you sharing information or actually communicating? (There is a difference.)
  4. If it can be done it will be done, but if you don’t do it who will?
  5. What if you could tell your clients what will happen? (How much value will that bring?)

As you start anticipating the future and ask yourself these questions, be aware of your mindset. Are you aiming to keep up or leap ahead? Daniel Burrus points out with the powerful skill of anticipation you have the ability to jump head and take the lead.

What future facts do you see?

John Engels

Founder and President, Leadership Coaching

Fear and Succession Planning

I have been doing some deeper exploration of the hidden ways in which fear affects functioning.

This is an important topic for firm partners because fear-based decisions are not always obvious yet frequently produce negative personal and organizational outcomes.

The challenge of succession planning illustrates the subtle and powerful ways in which fear influences important decisions.

Family business succession

Most experienced CPAs have observed their share of succession planning nightmares among family business clients.

In that setting, succession offers an intense mix of emotional factors that can easily freeze the thinking capacity of its members. Questions pop up everywhere: Are my kids qualified to lead the business? If I favor one of my children for leadership, how will the others feel? What if there’s tension or philosophical differences between the generations or between the successor siblings?

When such uncomfortable questions arise, the path of least resistance is avoidance.

I often get calls from firm partners who complain that their family business clients won’t plan for leadership succession.

“Even when we agree on a process for a path forward, the important conversations with the next generation just don’t happen,” partners say. “If they do, it typically doesn’t go well.”

Accounting firm succession

It’s easy to, pick on family businesses, yet the same lack of traction occurs in accounting firms. Even though it’s in the financial interest of soon-to-be-retiring partners to plan for succession, they tend to move slowly and uncomfortably – or not at all – in developing younger partners.

For example, opportunities routinely get overlooked to introduce and transition younger partners to long-time clients. Instead of encouraging emerging leaders to make their mark, established leaders often leave them out.

The commonly-cited excuses are time problems (“I’ve been so busy…”) and perceived skill limitations (“I’m not quite sure how to go about this.”). Those might be legitimate impediments to succession planning, but the big one rarely gets mentioned: “legacy jitters.”

Deeper fears

The succession procrastination of firm partners likely reveals an unconscious fear of losing their standing as key influencers. Deeper fears lurk under the surface:

Fear of losing status.

Fear of losing satisfaction and meaning.

Fear of moving on, into an “unknown” lifestyle.

Fear of death.

It would be good if these fears could be named, accepted and managed. An unfortunate irony is that most of us are afraid of fear itself. We don’t want to feel it, we don’t want to think about it, and we don’t want to address it.

Our reactive fear of fear makes it difficult to find our way out of this emotional maze.

One starting point might be to deepen our understanding of fear.

Understanding fear

The fear-driving mechanisms of humans have a purpose: to protect us from real threats. If we couldn’t feel fear, we would routinely take stupid risks. Healthy fear stops us from speeding past a railroad crossing or jumping off a cliff. Less dramatically, fear helps us keep doctor appointments and motivates us to research an investment before we commit.

That makes fear a vital asset.

But there’s a problem.

When humans fail to regulate their fear, it gets out of control. Unregulated anxiety, worry and fear disables our ability to distinguish real threat from fake threat. Now, we over-estimate a threat, or imagine threat where it doesn’t exist.

For example, we see a terrorist beheading on the internet and unthinkingly become more protective of our kids. In response, their anxiety ratchets up. They grow more wary than trusting, and become more concerned with safety than adventure. We want our kids to possess confidence and courage, yet our fear-driven parenting can have the opposite effect.

A fearful response to imagined threat generally produces low-maturity outcomes.

“No lion in the bushes”

Few of us can think straight when we get scared. Instead, we react instinctively, as if a lion was lunging at us from the bushes.

In the case of succession planning, “there’s no lion in the bushes.” Although we can slip into imagining succession as a threat, it’s actually developmentally appropriate. A time arrives when a founder or partner moves on because it makes sense to do so. Though it comes with understandable trepidation, letting go and moving on is not “unfortunate” or “a problem.” It’s healthy and necessary.

What gets us in trouble is the fear-driven resistance to the false threat of succession.

Is there a way to discover that there is no lion in the bushes?

Self-observing and reflecting

The trick is to cultivate the discipline of self-observing and reflecting.

The challenge to grow a succession mindset depends on our ability to observe ourselves in a reactive mode: “I’m feeling worried and fearful right now, and I need to check out the accuracy of my threat-perception. What’s really going on here?”

Sober thinking informs us that succession is more a mindset than a strategy.

Reflection enables us to recognize a fact of human history: Preparing the next generation to function at a high level has always defined parenting and leadership. It’s simply what we do.

Taking time to recognize what we are feeling and experiencing, and to assess the reality of our perceived threats, helps us become better observers of ourselves. Reflection becomes our path to reducing fear.

Smart leaders tune in to what’s really going on so they can act more out of intention and less out of fear.

John Engels founded Leadership Coaching, Inc. in 1996, based on the integration of three cutting-edge research disciplines: neuroscience, Bowen Family Systems Theory, and the evolution of leadership in non-human species. Under John’s guidance, his consulting team continues to draw on decades of learning with family researchers and with accomplished scientists who study the leadership behavior of wolves, elephants, chimpanzees, and other animals. Currently, John spends much of his professional life as a mentor to executive coaches and family business consultants. He recently developed the “Leadership Skills That Change Firms” program for accounting professionals.

Tom Bachmann

Master Leadership Trainer, Paychex, Inc.

Leading Virtual Work Teams

Virtual teams are emerging as the basic unit for conducting business of all types. Studies show that over 80% of workers today are involved in some way with team members who are not physically located in the same office. Virtual communication networks have made virtual teams possible, while globalization has made them a necessity.

Leading virtual teams presents new challenges to leaders and managers because you have a decreased line of sight that can impact your capacity to build and maintain relationships and engagement, and manage performance and communication. There is a greater tendency for remote employees to make assumptions, feel isolated and disconnected, not understand how their work fits into the bigger picture, and not share their frustrations or concerns. The following actions can help you overcome these challenges so you can lead your remote employees and teams more effectively:

  • Do a face-to-face team building event at least once a year.
  • Determine communication ground-rules that enable successful working relationships: respond to feedback requests within the requested timeframe (avoid virtual silence); avoid multi-tasking during meetings; when you disagree, seek to understand more before seeking to be understood; discuss sensitive information via phone not email; agree on acceptable hours for communication, how to reach one another outside of normal working hours and emergencies, and when, how, and who to inform if coming in late, leaving early, or taking time off.
  • Work with your team to create the team’s purpose, vision, brand/logo, team theme, and song.
  • Invite members to share personal stories of recent events at the start of your staff meetings.
  • Have a recognition program.
  • Be very accessible and responsive. Be accommodating to employees who work in different time zones than you.
  • Set expectation that employees need to proactively raise concerns to you. It is hard to be a mind reader from afar especially when you don’t have any visual cues.
  • Maintain a consistent schedule of 1:1 meetings. Ask direct questions during 1:1 meetings: What else do you need from me? How do you feel about your current contribution to our team?
  • Broker networking opportunities for remote employees by connecting them with peer groups or mentors in their location.

For more information on leadership skills and management tools necessary to thrive and succeed in a virtual environment, don’t’ miss the Leading Virtual Work Teams session at AICPA Practitioner’s Symposium and TECH+ Conference, Monday June 6, 1:55pm – 3:10pm at the Aria Resort & Casino, Las Vegas, NV.

Nicole Gantz

Director of Marketing, Honkamp Krueger & Co., P.C.

Streamlining Honkamp Krueger's Client Patronage Program with a Mobile App

Culture of Innovation at HK

Ask most professional service firms, and if they are brave enough to answer, they will admit they are challenged about how to truly be different than the CPA firm across town. We all feel passionately about our firms, that we offer world-class, quality services from experienced, incredible people. But we all make that claim – so how are we different?

One approach Honkamp Krueger (HK) has used is a culture of technology innovation. Led by technology partner and champion, Natalie Hoffmann, CPA.CITP, HK partners and managers strive to innovate at every level of the firm, both with streamlining processes with and for clients, and our own internal processes.

The marketing department is no exception in the expectation to innovate, so we developed an app.

Members from the partner group, marketing and IT departments developed a quick list of app ideas. We decided to focus on an app solution that benefited both clients AND employees, and one that would help alleviate an inefficient internal process. We chose to develop a mobile app for Android™ and Apple® to streamline and add innovation to HK’s Client Patronage Program, in which promote to our employees to intentionally shop at our clients.

Innovation to reality

Hoffmann led the marketing and business development teams through the process of mapping out our needs, reviewing and comparing proposals, choosing the best developers, and all of the other small but important details involved in developing your own technology.

The outsourced technology company worked closely with the HK marketing department to launch the mobile app including the branding, content, functionality and reporting systems. HK marketing worked with Apple and Google to make the application available in iTunes® and Google Play™ stores. A web-based version was also created for employees who do not use mobile apps. Finally, the HK IT department worked diligently with developers to implement the highest security measures for the app.

Overall, implementation took one year. During the launch, the HK marketing department trained all employees on the application and continues to train all new hires on the focus of the program and the mechanics of use.

With the app, employees are able to easily discover firm clients they can shop at, review detailed information about products and services, map client locations, get driving directions, submit spending amounts, and win fun prizes. Our marketing department is able to run spending reports by industry, client and employee, and provide this critical and impressive information for business development and client retention efforts.

What were the results of the app?

Results have far exceeded expectations. Receipt submission increased by 43%, employee participation increased by 47%, spending dollars increased by 50%, and manual hours spent by the marketing department decreased by 14 hours per month.

In addition, the program and the app have proven to be critical tools in the sales process of winning new retail clients and keeping current clients who are impressed by the program and appreciate the loyalty.

Finally, HK has received national recognition for the program with the January 2015 cover story of Accounting Today, an article in the November 2014 edition of INSIDE Public Accounting, a Maverick Marketing Award by the Association for Accounting Marketing, and the 2015 Innovative Practitioner of the Year award to Hoffmann by CPA.com.

Through a combination of a culture of innovation, leadership willing to provide the resources needed to develop ones own technology and hardworking, forward-thinking teams, HK was able to get a significant return on its technology investment.

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