Practice Excellence and profitability

AccountingWEB editor John Stokdyk launches a series on the elements of practice profitibility with a look at some of the key lessons from successful firms in the 2012 Practice Excellence Awards.

As part of the shortlisting panel in the 2012 Practice Excellence Awards, I was privileged to get an insight into the behaviours and techniques of some of the country’s most successful accountancy firms.

The premise of our awards is that excellence leads to growth, not just in client numbers and fee income, but profitability too.

One of the key insights that consistently comes through from the PEA entries is that client care is a state of mind: top-performing firms put clients at the centre of their vision and pay particular attention to their feedback and changing needs, and adjust their services accordingly.

Many of the shortlisted firms in the 2012 Practice Excellence Awards already surveyed clients and monitored their satisfaction ratings. The principle behind the entire scheme is to broaden access to this data through online client polling.

This article draws out some of the common themes and approaches from the shortlisted firms that had a positive influence on their client satisfaction ratings and profitability. The full text covers:

  • Net promoter - good service equals good revenue
  • Adding value boosts satisfaction and profitability
  • Elements of profitability: Targeting and process efficiency

The pattern of good practice is fairly clear from the approaches at the majority of our shortlisted firms. And you do not have to be in the top 10 category for sales and marketing to benefit from these suggestions.

We are also keen for AccountingWEB members to share their insights and ideas on the site. Contributions to the debate will be added to follow-up articles looking in more detail at the elements of practice profitability.

Continued...

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Comments
Kent accountant's picture

Careful    2 thanks

Kent accountant | | Permalink

"Reduce time and resources on compliance to maintain profit margins and free up time for fee-earning staff to devote to higher value services."

That and getting junior to do most of the low level work does increase the risk of getting the accounts wrong. You need to ensure that systems are in place to mitigate this risk and not just concentrate on increasing profit margins.

Fine, 'add value' so to speak, but get the basics wrong and that will really disappoint the client.

 

Kent accountant's picture

Ok, can't resist another go...

Kent accountant | | Permalink

...whilst this added value is great its very easy to miss the point of what we do, or what clients need us to do - compliance work.

The rest - business plans, cash flow forecast, virtual FD etc is a service some clients may need, if so great, but please don't go OTT.

With the various peddlers of added value marketing (I'm not taking a swipe at them all) its very easy to overlook why that client first came to us, lose sight of that and you will be in trouble.

I have to laugh at those businesses that say:

"...We don’t charge for things that people resent paying for..."

What a load of rubbish, plenty of clients need compliance work doing, may not like it but appreciate they need to pay for it.

Cash flow forecast meanwhile will be of value to some, but not to most - the others either don't need it, don't want it or do it themselves.

You'd struggle to grow an accountancy practice not charging for "...things that people resent paying for...".

So I'll stick to doing compliance work, do a few bits of 'added value work' when its needed and with a bit of luck I'll continue to grow my client base again this year by keeping clients happy by doing work properly, on time, for a reasonable fee and by staying in touch.

i won't try and force additional services (they don't need and can't afford) down their throats.