PracticeConsultingPractice Management Special – Hard road to future riches.

Practice Management Special - Hard road to future riches.

How to haul your practice into the 21st century was at the centre of

There was a noticeable lack of the customary sea of black and grey suits despite the illustrious setting for the Scots ICA’s annual practice management conference last week.

For the second year running, institute members gathered in a 200-year old former stately home on the shores of Loch Lomond.

It could be that the remoteness engenders debate and contemplation, or that the attractive location encourages leading speakers to attend, but the majority of those attending the conference left feeling considerably more inspired than were when they arrived. Many left with new ideas, determined to put them into action.

The conference began with talks highlighting some the grim realities facing general practitioners today, on both sides of the Atlantic.

Less than 20% of small practitioners in the US have a written business plan, according to Sam Allred, partner responsible for computer consulting at Anderson Zurmuehlen & Co in Montana, as he explained the reasons behind the failure of many general practitioners to raise fee income.

‘Firms should be willing to invest 10% of their revenue on marketing,’ urged Lyne Noella, managing director of the LarsonAllen Marketing Group, a Minneapolis marketing strategy, branding and e-commerce marketing firm.

‘Most firms fail in consulting because they don’t put the necessary resources behind it. People don’t want to take the plunge,’ chided Gary Boomer, founder of Kansas-based Boomer Consulting Inc.

But the obvious lack of nodding heads after lunch and eagerness to get to the workshops scheduled for the afternoon proved that, despite the casual dress and relaxed atmosphere, many of the delegates had been inspired to haul their practices into the 21st century.

Although many left Noella’s speech on marketing feeling she was probably ‘over-exaggerating’ the importance of heightening their profile in the media, her workshop on marketing tips got the biggest quota of delegates.

As Gary Boomer reeled off the basic e-business components, like an electronic personal tax organiser, client referral system and bill presentment – words still unfamiliar to many Scottish practitioners – one delegate asked: ‘Are we really so far behind the States (in e-business)?’

Boomer’s response – ‘you’re way too critical of yourselves!,’ – only went part of the way to convincing his audience of their potential to adapt to the world of e-business.

‘Your government and telecoms companies haven’t given you the opportunity to launch into the web like in the US,’ he said in an attempt to inspire his listeners.

The main message that permeated almost every speech at the conference was the need to build niche markets.

As ICAS president Grenville Johnston put it: ‘The most successful firms will be those in niche areas. Be the Rolls-Royce of your area.’

The bonus of tapping into niche markets, as Robert Mowbray, partner of the 47-partner firm MacIntyre Hudson, viewed it was ‘you need to know less if you specialise, but you are seen as a specialist’.

Although many saw the conference, in its second year, as a way of ‘validating their thoughts’, most admitted there were a multitude of ‘top tips’ that they intended to implement on their return to the office. Indeed, many of the firms, such as Aberdeen-based Anderson Anderson & Brown, sent three partners this year.

‘If you just send one partner then it is difficult to motivate the rest of the staff when you get back to the office,’ said one delegate. ‘If two or three go along there is a better chance of putting the wheels in motion.’

THE INCREASING IMPORTANCE OF MARKETING

Accountancy firms should spend around 10% of their revenue on marketing and must think long term, a marketing specialist told the conference.

Brand marketing has become increasingly important to the accountancy profession as it faces tremendous change due to technological advances, according to Lyne Noella, managing director of LarsonAllan Marketing group and named ‘marketeer of the year’ by the US Association for Accounting Marketing.

‘A compelling message is necessary to make a firm stand out from the rest,’ she said. ‘Do something different.’ She suggested making use of surveys, hosted chats and case studies – all of which should be provided over a firm’s website.

Noella also suggested firms draw up a five-year marketing plan and increase spending yearly.

‘FIRMS THAT ADAPT ARE THE MOST SUCCESSFUL’

The most successful accountancy firms are not necessarily the biggest, but those that can best adapt to the marketplace, according to a leading US accountant.

In his opening speech to over 100 delegates at the conference Sam Allred urged firms to adopt a written business plan and not to ‘shoot from the hip’.

‘There are four key steps; assess where you are, look at the skills available, write your plan, monitor and revise it,’ according to Allred.

Allred, partner responsible for computer consulting at Anderson Zurnuehlen and Co in Montana, warned firms against leaving success to chance.

He identified the following seven strategies – business plan, marketing, recruitment, training, compensation, quality control and research and development – as crucial to ensuring firms grow successfully in the 21st century.

FIRMS FACE STAFFING PROBLEMS

Technology, training, recruitment and staff retention are the overwhelming concerns for small practitioners struggling to keep a pace of changes in the modern accountancy world.

These fears were confirmed at last week’s Scots ICA conference as speakers reeled off harsh statistics of stiff competition for staff from other industries, declining student numbers and inadequate training strategies.

Gary Boomer founder of Boomer Consulting said: ‘Young people have quit coming into the profession. There has been a 20 to 25% decline in students coming into the US profession.’

Management consultant Gordon Gilchrist, put the figure at 25% less in the UK and warned that too many accountancy graduates were joining Big Five firms.

The majority of the 40 to 45 firms gathered admitted they faced staffing problems.

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