{"id":89831,"date":"2021-10-20t19:00:00","date_gmt":"2021-10-20t23:00:00","guid":{"rendered":"\/\/www.g005e.com\/?p=89831"},"modified":"2024-08-14t11:25:53","modified_gmt":"2024-08-14t15:25:53","slug":"the-six-essential-kpis-for-ceos","status":"publish","type":"post","link":"\/\/www.g005e.com\/2021\/10\/20\/the-six-essential-kpis-for-ceos\/","title":{"rendered":"the six essential kpis for managing partners"},"content":{"rendered":"

proper planning prevents poor performance.<\/strong><\/p>\n

\"\"by bill penczak<\/em><\/p>\n

we have all heard the term, \u201cworking in the business\u201d instead of \u201cworking on the business.\u201d\u00a0 \u00a0i would suggest that most managing partners and senior leadership fall more into the \u201cin\u201d than the \u201con,\u201d given staff turnover, busy season deadlines, exhaustion, and advancing years of many managing partners.<\/p>\n

more: the great resignation: five reasons accountants are quitting<\/a>\u00a0 \u00a0|\u00a0\u00a0five tips for better decision-making<\/a> \u00a0 |\u00a0\u00a0your marketing sucks: six reasons why<\/a> \u00a0 |\u00a0\u00a0five global cpa leaders: four survival strategies<\/a>\u00a0\u00a0 \u00a0|\u00a0\u00a0are you too generous with your write-offs?<\/a> \u00a0 \u00a0|\u00a0\u00a0it\u2019s time to herd your highly compensated cats<\/a>\u00a0\u00a0|\u00a0nine smooth moves to build client satisfaction<\/a>\u00a0 \u00a0|\u00a0five tough questions for these tough times<\/a>\u00a0|\u00a0\u00a0i started a consulting practice the first week of march 2020<\/a><\/p><\/blockquote>\n

i\u2019ve endured enough management committee meetings during which the course of conversation leans more heavily towards rat-holes than addressing key firm issues of people, technology, quality, risk management, and growth.\u00a0 at the end of the day, every decision you make as managing partner foots back to one of those areas. deciding on the venue of the holiday party does not fall into that category.<\/p>\n

peter drucker, the famous management consultant, summed it up succinctly: management is doing things right; leadership is doing the right things.<\/em><\/p>\n

here are six ideas that managing partners should contemplate when it comes to running an effective and engaged firm:<\/p>\n

1 \u2013 focus at the top<\/strong><\/p>\n

it would be interesting for managing partners to examine their week and assess how they are spending their time outside of client work. i\u2019ve had many conversations with partners about \u201chighest and best use\u201d and how they are sometimes reticent to relinquish decision-making on even minor issues to others. \u00a0auditing your own work isn\u2019t permissible for audit client but auditing how you spend your time, and the resulting value would be a great exercise.<\/p>\n

i would suggest keeping a spreadsheet of daily and weekly tasks and label them:<\/p>\n

    \n
  1. \n
      \n
    1. \n
        \n
      1. high value to the firm\u2019s long-term success<\/li>\n
      2. moderate value to the firm\u2019s long-term success<\/li>\n
      3. low value to the firm\u2019s long-term success<\/li>\n
      4. no value to the firm\u2019s long-term success<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n

        your own assessment might cause you to think\u2014and act\u2014differently, and evolve the art of delegation.<\/p>\n

        2 \u2013 create and maintain a process for identifying and managing key performance indicators<\/strong><\/p>\n

        for a profession obsessed with numbers, we rarely delve into the causal elements of the typical firm metrics of realization, utilization, turnover, margin contribution, and organic growth.\u00a0 i understand its often difficult to even get the right numbers in a timely manner from your own accounting department (more on that later) but spending time \u201con the business\u201d requires a deeper dive into why and why not things are working properly.\u00a0 the best led firms have management dashboards, often in graphic form, that shows trends and derivations from goals, along with the underlying activities and decisions that inform them.\u00a0 one kpi tool i\u2019ve used extensively is ceo tools 2.0 by jim canfield<\/a>, which includes worksheets to set strategies and the actions to support them.\u00a0 ceo tools<\/em> is an example of smart goals (specific. measurable. achievable. relevant. time-bound) and it would be a smart thing to investigate for your firm.<\/p>\n

        3 \u2013 closely link partner compensation to firm<\/em> performance metrics.<\/strong><\/p>\n

        here\u2019s where the rubber meets the road.\u00a0 while not all partners are motivated strictly by money, few would object to more lining in their pockets. ideally, each of the firm kpis would cascade to individual department heads or partners, and a weighted scorecard would determine an equitable bonus structure.\u00a0\u00a0 but don\u2019t make that structure too complicated or include too many metrics.\u00a0 i know of a firm in which the managing partner maintained a meticulous spreadsheet with more than 20 data columns that he used to determine partner compensation.\u00a0 the partners i spoke with about this found it onerous and unattainable, and even their eyes trained to look at spreadsheets would glaze over.\u00a0 \u201ci don\u2019t even know where to start,\u201d confided one partner.\u00a0 \u201cat the end of the day, the bonus program was still a popularity contest.\u201d\u00a0 few and specific kpis are the great equalizer.<\/p>\n

        4 \u2013 involvement of more than the partner group.<\/strong><\/p>\n

        this approach achieves dual goals\u2014getting things done by those with the drive to contribute–beyond only your partners–and engaging your firm\u2019s the best and brightest as part of a retention strategy.\u00a0 i would rather have an engaged senior manager or principal actually leading the charge on a firm initiative than a tenured partner who get up and go, got up and went.\u00a0 your younger professionals don\u2019t usually come with a lot of baggage, and as a rising star, they have something to prove.\u00a0 and likely want an escape from the monotony of another financial statement audit. you already know who they are\u2014engage them.<\/p>\n

        5 \u2013 creative thinking.<\/strong><\/p>\n

        i know there\u2019s some reticence in the industry to even use the word \u201ccreative\u201d when it comes to accounting.\u00a0 (i do know of a firm who boldly adopted that word in their new firm values, to the surprisingly enthusiastic entire partner group.)\u00a0\u00a0 remember the adage, \u201cif you\u2019ve always do what you\u2019ve always done, you\u2019ll always get what you always got.\u201d\u00a0 some creative thinking approaches could be engaging a client advisory panel; discussing topics with other firms in your cpa firm network; or enlisting the insights of trusted influencers like bankers or investment bankers.\u00a0 these ideas might be out of your comfort level, but if they can assist in your navigating the firm\u2019s growth and accountability, there\u2019s no downside to doing so.<\/p>\n

        6 \u2013 an engaged and capable strategic services team.<\/strong><\/p>\n

        one of the resources firms often overlook is their own strategic services professionals (aka admin group, a term that i find disparaging). the right professionals in hr, marketing, it and finance can and should do the heavy lifting on many firm strategic initiatives, because as i mentioned earlier, these initiatives fall into the people, technology, quality, risk management and growth categories.\u00a0\u00a0 one of the frustrations i\u2019ve heard expressed from some marketing directors, for example, is that they don\u2019t have a seat at the adult table at many firms.\u00a0\u00a0 engaging your non-billable bright minds allows them to be engaged in the firm, assists retention, and ensures the right things are getting accomplished without the burden of client deliverables.\u00a0\u00a0 if you don\u2019t have finance, marketing, hr and it professionals capable of bigger thinking, then perhaps its time to upgrade.\u00a0 but i\u2019m certain that most firms do have people with good ideas, whose voices have been silenced in the past.<\/p>\n

        there was an urban legend story a few years ago about a ceo of a major company who said something to the effect, \u201ci could leave my strategic plan on an airplane, and have it fall into the hands of one of my competitors, and it wouldn\u2019t matter.\u00a0 that\u2019s because when it comes to strategic planning, all that matters is the execution.\u201d\u00a0 employing these six strategies is all about the execution, because talking about strategy and actually doing it are often worlds apart.<\/p>\n

         <\/p>\n","protected":false},"excerpt":{"rendered":"

        \"\"<\/a>
        \nproper planning prevents poor performance.
        \n<\/strong>by bill penczak<\/em><\/p>\n","protected":false},"author":3489,"featured_media":89834,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"_relevanssi_hide_post":"","_relevanssi_hide_content":"","_relevanssi_pin_for_all":"","_relevanssi_pin_keywords":"","_relevanssi_unpin_keywords":"","_relevanssi_related_keywords":"","_relevanssi_related_include_ids":"","_relevanssi_related_exclude_ids":"","_relevanssi_related_no_append":"","_relevanssi_related_not_related":"","_relevanssi_related_posts":"","_relevanssi_noindex_reason":"","footnotes":""},"categories":[2741,2327,2259,1908,2271,2374,3120,3002,2297,2301],"tags":[2429,643,715,572,38,1416],"class_list":["post-89831","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-checklist","category-innovation","category-leadership","category-management","category-marketing","category-pay-compensation","category-pro-member-exclusive","category-special","category-staffing","category-talent","tag-earnings","tag-hiring","tag-jobs","tag-pay","tag-salary","tag-wages"],"acf":[],"yoast_head":"\nthe six essential kpis for managing partners - 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