At first sight, the Prime Minister’s recent electoral implosion would seem to have little to do with our day-to-day activities. However, I see obvious parallels.
It is easy to forget that two months ago, Mrs May was a happy new Prime Minister clearly excited about her role in leading Britain out of Europe. Her power base, both within the Conservative Party and the country (as represented by the media), was seemingly unshakeable, even if her parliamentary majority was nothing to write home about. It certainly helped that Jeremy Corbyn was (regarded as) a joke, meaning that there was no credible opposition.
Unlike Gordon Brown, who missed out on a heaven-sent opportunity to consolidate his position by calling an election, Mrs May then decided to change the law and strengthen her position by bringing in another 50 or so Conservative MPs, almost all in Labour seats.
Other than those who have been living in outer space for the last few days, everyone now knows that things did not quite go to plan.
So, ignoring my own experience in seeing a managing partner disastrously do exactly the same in an election on a much smaller scale, what has any of this got to do with accountants?
The first basic message that I hope all of you will have spotted is that you have to do the sums before making any big investment. Many firms of accountants have come a cropper when their big decisions were ill-informed. This can come about when you employ the wrong person or, worse, take over an ailing practice and only discover afterwards why it was falling apart.
Basically, unless you know with almost complete certainty what the outcome of any big decision will be, it is generally far safer to stick with the status quo unless that will be damaging in itself. If this sounds prudent, sorry but I’m an accountant and have been trained to think that way.
The other failing that I would attribute to the unfortunate Mrs May, who might soon be looking for alternative employment, is arrogance. She knew that she was right and I have little doubt that failure on the scale that transpired didn’t even occur to her.
We should be able to learn from this. If you keep putting charge out rates up then eventually, clients will cry wolf and go elsewhere.
Similarly, if you take your best members of staff for granted, don’t pay them properly or fail to promote them at the right time then, if they are any good at all, the competition will snap them up.
Finally, empire building is all very well and great for the ego. However, if in attempting to build your empire you destroy it, then perhaps the quiet life is a safer solution.
Now all that Mrs May can do is sit back and wait for the knives to come out. Unless you want to go the same way, learn from that lesson.
About The Imprudent Accountant
Someone who should know better, but can't resist the occasional rant about the more exasperating aspects of the accountancy profession.