good management gets them there.
by marc rosenberg
the rosenberg practice management library
if partners of firms across the country were asked what the key was to the success of legendary fortune 500 companies such as general electric, coca-cola, ibm and countless others, i’m sure that the words “strong management” and “strong leadership” would dominate their responses. yet, ask those same partners to evaluate their own firms’ management, and if they are honest, their responses would not be very flattering.
more: five ways to separate accounting winners from losers | two factors determine firm profitability | five keys in compensating new managing partners | what partners do and don’t deserve | five steps to transition to partnership
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of all of the techniques for improving cpa firm profitability, none is more effective than strong management and leadership. yet, nothing is more elusive. why is this?
perhaps it’s because cpas aren’t trained to be good business managers. perhaps it’s because they don’t have time for it. perhaps it’s because the firm’s partners are afraid of management, because inherently they know it will ultimately cause them to be more accountable for their performance. perhaps it’s the partnership form of organization (even if firms are corporations, most still operate as a partnership) that is to blame – it breeds a partner attitude that says, “i am an owner, so no one has the right to tell me what to do.” maybe some cpas have yet to realize that their number one client is their firm.
good management and leadership:
- identifies challenges and focuses people’s attention on those challenges.
- is visionary in its thinking. leaders constantly find new things the firm needs to do.
- persuades people to do what they don’t want to do, or do what they’re too lazy to do, and like it. (harry truman)
- holds people accountable for their performance.
- makes decisions crisply.
specifically, in a cpa firm, good management makes sure the firm:
- has a strategic plan.
- provides consulting services that clients want.
- markets proactively.
- has a means of holding partners accountable for their performance.
- tends to the basics – quality control, billing, collection, profitability, productivity, etc.
- has good partner relations.
- provides an attractive place for staff to work and stay.
a firm’s strong management, through the managing partner and other ways, can influence the behavior of others and get them to accomplish the above. there is no greater way to impact the bottom line.