you need them as clients … and employees.
by frank stitely
the relentless cpa
do you know why millennials can’t buy houses?
- avocado toast is expensive.
more: seven ways to beat staffing shortages | who’s your most valuable employee? | ‘quick questions’ and other client sins | when clients create errors | how we killed the tax season client meeting | why small firms can win the talent wars
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how many millennials does it take to change a light bulb?
- none. they accept it for what it is.
why do millennials always type in lower case?
- they reject capitalism.
what is a millennial’s favorite fragrance?
- scents of entitlement.
buy me a craft beer, and i’ll tell you a half dozen more. now, after all of the above, i’m about to tell you why you need millennials as clients and how they increase the efficiency of your firm.
let’s go back to the numerator of our basic equation:
turnaround time = wip / capacity.
in a previous post, i listed all of the reasons to minimize unnecessary meetings, phone calls and emails. primarily they all get down to creating unnecessary wip and thus decreasing turnaround time.
what happens when you call a millennial on the phone? nothing. absolutely nothing. most of the time you don’t even get voice mail.
where do millennials go to meet? again a trick question. they meet on social media.
have you ever asked for the personal email of a millennial? they don’t have one. leave them a message on instagram.
millennials are ideal clients. why? they value effective communications. as you’ve read probably 400 times already, inefficient communications methods add to wip and thus decrease turnaround time and client satisfaction.
i’ve written at least 300 times already how millennial clients are more valuable than boomers, because they’ll be alive a lot longer. millennials are just coming into the years when people typically start businesses. guess who’ll be buying boomer businesses over the next decade? guess who’s likely to buy your practice?
all of the above leads to the inevitable conclusion that millennials will eventually become the largest demographic segment of your client base if you’re building a practice to survive the next decade. if your time horizon is less than 10 years, why worry? because as noted at least 1,000 times earlier, if your retirement depends on selling your practice, you’d better have clients worth buying. nearly dead clients won’t make the cut.
because the math on millennial clients is so overwhelming, and you are good at math, i’ll assume that you buy into the basic concept that millennial clients are key to your long-term success from an efficiency standpoint.
let’s talk about creating a millennial-friendly firm. here are the key points that we will cover:
- hiring millennials to serve millennials
- providing services that millennials can buy
- communicating with millennial clients
- delivering services for millennials
- marketing to millennials
- creating a millennial-friendly office environment
for this next example, i’ll assume you’re a boomer who has just hired a millennial staff member. your boomer clients just love getting advice from millennials, don’t they? seventy-year-olds love being lectured on financial planning by 30-year-old advisors. not in this universe.
let’s flip this. do you think millennials enjoy being lectured on financial responsibility by 60-year-old advisors who still joke about when saturday night live was still funny, sonny? and stay off my damn lawn.
i just slipped into an old man coma.
millennials absolutely hate being lectured by parent figurelike advisors. let’s play a very simple logic game. if you need more millennials as clients, and millennials don’t like old people as advisors, who do millennials want as advisors?
they want other millennials.
to attract more millennial clients, you must hire millennials for your firm.
age conflict isn’t the only way millennials will change your firm. they are in a different stage of life from your boomer clients. with boomers, we talk about the final stages of financial and tax planning leading to imminent retirement. millennials have a much longer time horizon and a lot of financial hurdles in the way before retirement.
many are figuring out near age 40 how to afford a house. they are trying to get out of crushing student loan debt. they are worried about making more money and not how to pass on that ira to the kids.
financial planning with millennials is actually financial planning and not just investment management as it has become with boomers. with millennials there are few investments to manage.
if you’re already providing wealth management services, you probably fear the rise of the robo-advisor. for those of you not in wealth management, the financial planning world has its shorts in a twist over software programs that pick investments at least as effectively as human investment managers. i’m being generous to the humans.
here’s some great news for tax preparers: you can’t flee commoditization by offering wealth management services. if anything, that market is even more commoditized because of robo-advisors and target date index funds.
what you can do is redefine financial planning from wealth management, based on managing investments, to wealth accumulation. guess what millennials need more – wealth management or wealth accumulation? you must provide services that millennials can buy.
i’m not going to kid you that switching to the wealth accumulation business model will be easy. the first obvious hurdle is that your clients, who are trying to accumulate wealth, need the resources to pay your fees. fortunately, we aren’t the first market in the history of mankind trying to pry cash from people who don’t have any. we’ll figure this out. i have a half-dozen ideas – for my next manifesto.
let’s conclude this little digression into the changing nature of financial planning with the following. to have millennial clients, you have to provide services millennials can buy.
let’s switch to communication strategies for millennials. let’s explore why they don’t communicate much by telephone by way of some examples.
what happens when you call a customer service line? something like this:
“please listen carefully as our options have changed. (they have not changed in 10 years.) our business hours are 8 a.m. to 5 p.m. our office address is 123 main street, somewhereville, ny. our fax number is 666-66-6666. we are closed on all federal holidays. during inclement weather, we follow the public school schedule. please press 1 for an option you don’t care about. press 2 for something else you don’t care about. press 3 to repeat this message …”
you get the drill. a question about your bill wastes an hour of your precious time on earth.
on the irs line, they ask for tax id number. after navigating their ludicrous auto-attendant system for 10 minutes and spending an hour on hold, you get a person. what do they ask for first? tax id number.
how much do you enjoy calling for computer tech support? they spend the first half hour getting you to do the things you’ve already done. for most consumer tech products, consider yourself lucky if your problem is ever fixed. i have thrown out products rather than play tech support lottery again. there is no day in my life when i have four free hours to talk with idiots who don’t know their own products and bounce me from one moron to the next.
the people who design these systems disrespect you and your time. for the most part, if i have to spend time on the telephone with a vendor, i don’t use that vendor.
it’s not just millennials who hate telephones. telephone communication has been rendered largely useless by companies trying to avoid customer service. that’s not going to change.
i addressed elsewhere the way the telephone sucks the life out of our schedules. clients and potential clients feel the same way. give them better electronic options.
i’m not suggesting that you trash your telephone system. i am suggesting that you trash your auto attendant. if you truly want your client service to stand out, have someone answer calls live. this can be some of the best marketing you can do.
here’s how this works. someone calls us after calling three other firms. they dealt with auto attendants and left messages. they have zero confidence anyone will return their call. they call us and the call is answered live. we may not have anyone immediately available to talk with them about their needs, but they get a live promise from one of our admin staff that a particular person will call them back.
i normally return these calls within an hour. i’ll interrupt what i’m doing for new business. the close rate on these, assuming we are a good fit, is pretty much 100 percent. the deal is closed before the other firms return the calls. answering the telephone live is a marketing expense.
let’s discuss electronic options. portals are currently the state of the art in accounting for electronic communications. we can post files for clients. clients can post files for us. some portals have some rudimentary note capabilities. isn’t that special? (old man snl church lady reference for millennials reading this.)
how much of the tax return preparation process involves posting files? some, of course. however, there’s a lot more to the tax prep process besides files. there’s a lot of other communication required, and that communication takes place largely via telephone and email.
let’s dispense with email first. isn’t the third week in march really joyful with 400 email messages per day? how much fun do we have receiving 20 messages from a client, each with one file attached? i can only describe as pure rapture, getting five messages from a client answering the three questions we asked, except that she really only answered two questions. now we get to enjoy another fun round of emails to get the last answer.
let’s dispense with the telephone next. instead let’s skip this as i have covered this 357 times already.
email and telephone communications load wip with meaningless dollars. that does what? let’s all sing it together now. it increases turnaround time. thank you, sir. may i have another? it increases turnaround time. i’m so proud of you right now.
what ‘s better than email and phone calls? waterboarding. starvation. a payroll service vendor bringing in donut holes on a friday morning. yes, that happened. one brought in two dozen donuts and had each person in the office take one. he took the rest to the next cpa firm on his rounds. such generosity. this is how hunger was conquered in the developing world. maybe not.
let’s next discuss how to deliver great client service to millennial clients.
what are we looking for in a millennial-friendly service delivery solution? we are looking for what pretty much every other 21st-century industry has – a comprehensive internet customer service solution that integrates with operations.
consider what happens when you order from amazon.com.
you place an order for liquid dent remover on the amazon website. the site feeds your order into their warehouse and shipping system (operations). then you get notifications as your order progresses from scheduling to shipping. you even get a notification when your liquid dent remover is delivered.
all throughout the process, you can log in to the amazon system to track the progress of your order if the automated notifications aren’t enough. if you have problems along the way, you can choose to resolve them through either the website or by telephone (more customer service).
why does the process for tax returns, or any other accounting services, have to be different?
your client creates a tax return project in your internet workflow software and loads his/her tax documents. when all of the documents have been posted, he/she presses a button to notify you to get started with the tax return preparation.
you assign the return to staff and turn over the project for preparation. your staff prepares the return and compiles a list of questions and missing information for the client. you review the list and “send” it to the client by pressing an approve button. your operations and client service systems are one and the same.
the client gets an email notification to log in to your site and answer the questions directly on the site. if the questions haven’t been answered, your system sends reminder notifications every few days. note that you have not yet initiated one email or phone call at this point.
the client answers the questions. your site notifies all the staff associated with the project that the return is ready to move to the next step. in addition, the system sends a message to the client thanking him/her for answering. what if the client has a problem answering one of the questions? he/she leaves a note on your system and you get a dashboard notification that the note is there.
still no emails from or to you and no phone calls.
your staff completes the return and notifies you through the site that the return is ready for review. your client may or may not, at your choice, get a notification that his/her return is nearing completion. you review the return and send it back to the preparer for some fixes. your review notes are all on your site for easy access.
the staff member fixes the return and passes it back to you. you post a draft tax return for the client to the site. with the draft, you write a note to the client on the site, brilliantly explaining how you saved him/her $10,000 in taxes by claiming the child tax credit for his/her pets. further you recommend for the next year that the pets be placed on the schedule c payroll, because they’re exempt from social security and medicare taxes. that last part is actually true.
your client gets a notification, with potential reminders, that the return is ready for his/her approval. he/she posts a note on your site with a few questions like, “once my schnauzer is 18, will he still qualify for the child tax credit?”
at this point, because you’re fully invested in the “dog qualifies for child tax credit” thing, you respond, “a jack russell terrier is probably a better tax planning solution, because they tend to live longer than schnauzers.”
with this fine tax planning advice, your client presses the “approve draft” button on your site, and you hand the return over to admin to be finalized. at this point, you are done. admin then posts the 8879 form and, using your site, moves the client through the signature process to completion.
don’t think this process can work? for the 2018 tax season, 70%+ of our personal tax clients worked with us this way. for the coming 2019 tax season, almost all of our new clients are already set up to use our system. i don’t want clients who won’t do business this way.
our one change from the process described above is our position that only cats qualify for the child tax credit.