Why you need to give up and stop competing

unexpected confrontation
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Trent McLaren
Head of Accounting & Sales Development
Practice Ignition
Columnist
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Trent Mclaren says accountants shift their mindset and stop competing if they want to scale their practice.

You know when you meet some accountants and think you really just need to give up and stop competing. Stop trying, just give up and quit. Stop competing. It’s not working for you. When you’re all out of answers because you’ve tried everything else and nothing seems to be working.

This week I was inspired by the Masters Of Scale podcast, hosted by Reid Hoffman (ex PayPal EVP and Co-founder and Chairman of LinkedIn). In the episode entitled Escape the competition, Reid interviewed Paypal co-founder Peter Thiel.

Listening to these two guys duke it out and talk through how you can stand-out in a crowded market, the thing that stuck with was Thiel’s view on how you should build a strategy that allows you to escape the competition - not compete with the competition.

We all get into these bad habits of looking over our shoulder and checking out what everyone else is doing. But who cares? If it’s affecting your client base, this is not a sign that you should be more like them; it’s that your clients have found something that you don’t offer that they value.

Don’t compete

You can compete with them, you can match them, but you’re not escaping them. You’ll be forever looking over your shoulder wondering what else they’re doing. This means you’re being reactive to the market, not proactive.

If you want to escape competition, you need to proactively solve and offer solutions to your clients that other firm’s haven’t thought of and can’t be easily replicated. If it’s easily replicated than you’re not blowing the competition away.

Shift your mindset and don’t think about what the market is doing. Think about what you can deliver and whether or not it can be easily replicated. Let me give you a tip: using certain apps and solutions with your clients, while it can be advantageous, it can be easily replicated. It may give you a head start but you’re still competing.

Forget competition, start thinking acceleration and what it is you can deliver that no one else can. It could be specialty services and disciplines, such as financial planning, small business lending, cloud integration and implementations, price setting, or actual advisory services.

You might be wondering where on earth you’re going to find these original innovative ideas. The proof is in the pudding: your clients.

Spend a day in the life of your clients

If you were to go on an excursion and spend a whole day with one of your clients, and sit in their office, I guarantee within three hours you’ll have witnessed some kind of massacre they call “running a business”. You’ll be horrified at first at the lack of processes, how they collect their data and how they interact with their clients.

You’ll then move through to a phase of serendipity by which you’ll realise this is an area you could actually help them with. Maybe that’s helping them record better data which gives them accurate information to make great decisions, which then gives them a higher probability of actually succeeding in their business and seeing the growth they want.

Once you realise that majority of small business owners don’t go to school to learn how to run a business, you soon realise that you are the answer they didn’t know they needed.

You’re the key to their future success, you just never realised because all you did was sit in your office and believed everything they’ve ever told you about how they run their business.

Sometimes you actually need to observe the problem before you can fix it. You can’t just hear it from your client’s mouth? Why? Because clients lie, why do they lie? There are many reasons: pride, shame and fear of failure being just a few.

People don’t want to admit defeat. They feel guilty for not being open and transparent. They blame themselves for their mistakes.

Conclusion

So stop competing and start focusing on your clients. If you focus on your clients, their needs, their wants and their problems, then you will never have a problem growing and scaling your business.

Unless you’re running a desktop based practice with no view or vision of running a true cloud practice, in which case you will have challenges scaling your firm. 

About Trent McLaren

Trent McLaren

Winner - AccountantDaily Thought Leader Of The Year for 2017

I lead a team of spirited people looking to make a difference in the accounting industry as we know it. Elimination of debtors, automated invoicing and the thought of never having to touch your firm's billing again is a reality we deliver to accounting firms all over the world.

I believe that in order to achieve your goals, you must be a leader and a believer. Your peers need to feel part of something real and exciting in order to succeed. Turning up to work is just not enough.

I believe in creating a positive environment that stimulates and motivates people. An environment that allows people to grow, develop and most importantly enjoy their work.

I am the head of accounting at Practice Ignition, a Sydney based start-up born out of an accounting firm, Interactive Accounting. We eliminate debtors and automate your invoicing through our digital proposal and engagement letter builder solution. We service 1000's of accounting firms around the world including the United Kingdom. 

In prior roles I have extensive history with Intuit QuickBooks, Xero, eWAY (online payments) as well as the retail sectors.

Replies

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16th Dec 2017 19:54

What a load of [***] b*llocks !!!

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By Trent M
to Kent accountant
19th Dec 2017 12:49

Thanks Kent! Feel free to actually add some thoughts to the conversation. I’d be interested to hear where you see this industry headed.

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to Trent M
19th Dec 2017 15:16

Where do I start! Firstly do you know what accountants do and what their clients do?!

It looks like you've penned a generic article and thought "...yep, that'll do for AccountingWeb..."

This...

"Spend a day in the life of your clients
If you were to go on an excursion and spend a whole day with one of your clients, and sit in their office, I guarantee within three hours you’ll have witnessed some kind of massacre they call “running a business”. You’ll be horrified at first at the lack of processes, how they collect their data and how they interact with their clients."

...is b*llocks.

So being blunt you are saying clients haven't got a clue how to run a business and we accountants could improve things in a matter of minutes.

Wow what a massive generalisation and kick in the nuts to those people running profitable businesses.

I don't know what sort of businesses you see and think most accountants work with.

And using a podcast with PayPal as an example bears very little relevance with what is going on with micro businesses across the world.

And for what its worth we've never competed with other accountants - we know what we do and we do it well. I've never seen other accountants as competition in fact I frequently meet up with the 'competition' have a beer, share ideas and anecdotes.

You need to pay a bit more attention (maybe find out?) what most small firms (the majority of the readership on this website) do - perhaps spend a day with one of them?

Don't come on here post poorly written articles and expect to get an easy ride.

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to Kent accountant
20th Dec 2017 06:42

Thanks KA, appreciate your perspective. If there's disagreement, then it's worth discussing. Outside of this forum there's been plenty of other views discussed and yours is the first I've come across in your "Blunt" words, which is great. I'd rather hear it, then not hear it.

I'm happy to hear the other side of the coin.

I can give you my background but I won't bother with the long version. In short I've worked and spoken with literally 1000s of accountants in the UK, AU, US + CA discussing best practice tips, advice, feedback and more so competitive strategy.

On average most of the firms I've worked with have been small to medium sized (1-20 staff) I'll admit I haven't spent as much time in the big end of town until this year!

I feel confident enough to pen this article to say the least.

And please be specific, the article's not poorly written. You just don't agree with the opinion that's been written. Which again is fine. Some will agree, some will not, so what. This piece is written to challenge the reader's thoughts on their firm's strategy.

Whilst you may not worry about the competition there is a large majority of firms around the world that are losing clients to other firms.

And whilst you may be enjoying the relationships you have with other accounting firms, accountants and peers, others do not have the same luxury.

So I appreciate your opinion is based on your experience and what has been your reality for what sounds like your career. But that is not the same reality that every other accountant on this planet endures.

And the podcast was extremely relevant for microbusinesses across the world. I would suggest you actually listen to it before calling judgement. Instead of perceiving to understand the context of it.

Microbusinesses with new ideas challenge existing small businesses every day. Small businesses either duplicate the service offering to match the value to the client or the invent other ways to stay competitive. But whilst they focus on matching the competition, they're not escaping it.

And that is the point. If you're in business and trying to remain relevant to your customer, eventually one day. You will have to change.

The accounting industry is no different. If accountants believe they can just keep running their firms and not change due to change in client demand or impact of new technology. (Which statistics have already shown is occurring) I'll be interested to see where that leads them over the next 5 - 10.

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17th Dec 2017 22:28

I’ve never worried what everyone else in our industry is doing. We’ve really just competed against ourselves in improving the value we offer our clients. We are a 100% Xero practice and use their full suite of Practice tools as well as a Practice Ignition which was a complete game changer for us. We have used trial and error over the years to automate as much as possible so we can really focus on the success of our clients and ultimately scale up. One of my favourite things is partnering or collaborating with other practices to help them give the best experience of Xero to their clients. There are lots of gaps in the knowledge of Xero amongst SME’s and Partners and so we are not just B2B but B2I (business to industry) - with 31 years in this space and over 10,000 hours in Xero we can offer a lot of know how.

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19th Dec 2017 10:00

I'm with Kent Accountant. Only I would have been blunter.

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By Trent M
to frankmcd
19th Dec 2017 12:48

Don’t hold back on my expense Frank. I’d be interested to A) hear exactly what you think and b) what are you actually contributing to the conversation.
Sticks and stones - let it loose.

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By Pygmy
to Trent M
19th Dec 2017 14:46

Assuming what you are proposing was a good idea what's stopping all our competitors reading AccountingWeb?

Why would people who apparently lie to their accountants submit to a pseudo-HMRC inspection?

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to Pygmy
20th Dec 2017 06:46

Thanks Pygmy,

The value in this approach is based on what your clients perceive to be of value.

When I refer to clients lying to their accountant - I'm talking more so about the "white lie's". When they smudge the truth a little bit, because they are embarrassed or don't feel confident to share "All" of the information.

By spending time in your clients environment you'll actually start to pick little bits and pieces that they don't do as well as they said they did.

Which is always a great place to start as you have an opportunity to add value in these moments and help these SME's streamline their process and get accurate data flowing into their accounting ledger. Which leads to better advice and better decision making, which is the ultimate goal.

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19th Dec 2017 12:33

Wise words. Innovation, positioning and standing out are key. Keep looking forward don’t look around you.

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19th Dec 2017 15:09

This sort of waffle pops up regularly from pedlars of bovine ordures on this site. Try selling the sort of consultancy you suggest to small clients. It is close to impossible. They would not want to spend the time, they would certainly not want to spend the money, and they would ignore everything you say. Unless they ask for it, don't offer it. As with any industry, if you choose not to compete, you choose not to trade. Nearly all the money in accountancy in compliance not consultancy.

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to JDBENJAMIN
20th Dec 2017 06:54

Thanks JDBenjamin,

It's impossible if you've not positioned it to your client correctly. Client's don't buy things they don't see value in.

Firms around the world are already starting to use these Deign Thinking principles to deliver true tailored services.

Yes you're correct, majority of fees do come from compliance, but did you know that ever so softly, compliance revenue is starting to decline year on year.

In Australia, for example, it's reduced by 10% over the past 10 years. With increases coming into multi-disciplinary services, business advisory etc.

If firms are trying to find more ways to add-value to their clients and increase their fees, then build the 1:1 consults into your service offering.

Call it a "Client Review or Client Observation" It's a mandatory service for part of your niche clients perhaps. Clients that you know all share the same struggles and gaps. This is where you'll get your quick wins.

If you find the gaps, you're able to optimise the client work, automate and systemise where possible. If you stick to just rolling out a standard cloud ledgers + apps package, your still leaving a whole bunch of data integrity, data review on the table.

Growthwise based out of Newcastle Australia (Xero Platinum firm), run business mastermind sessions with different tiered groups (Beginners, Intermediate, Pro).

Accodex in Adelaide, Have trained all of their partners and staff how to do cloud implementations and setups. Which has allowed them to attract large retail chains because they were able to solve the client problem by observing their current process.

So again, these practices already exist with cloud firms around the world. What may seem like a waffle to you, is actually the reality for some progressive firms.

Appreciate your insight.

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20th Dec 2017 11:27

@OP do you know Bob?

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21st Dec 2017 10:08

Happy Christmas Trent
What you wrote was effective, in so far as it got response!

You had to give a marketing truth a new wrapper, people read it. The truth is it is easier to upsell to existing clients than get new ones.
As to our clients' trades or professional activities, they are the experts not us. As to running a business and finance we are experts. Not all clients will want to pay for such services - but some will. We just need to identify the services particular clients need, label it, charge for it.
Clients do not value compliance services, but if we provide added value, help them make more profits or achieve their objectives, they will appreciate those services and happily pay for them.
And happy clients give referrals

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