What an Accounting Excellence firm looks like
Richard Hattersley goes in search of the archetypal Accounting Excellence practice and discovers that it is likely to use cloud accounting as a means to offer business advisory services.
Firms bringing home the gongs at the Accounting Excellence awards do so because what they’re doing stands out from a very innovative pack. But what ties all these firms together?
Data collated from the 2018 Accounting Excellence practice entries show that firms excel in different areas, but there are nine core initiatives that are common to a third of the entries.
These ingredients are what we think defines the typical Accounting Excellence firm in 2018. This article sets out to present a quick sketch of what those firms look like.
Among the key they shared were cloud accounting, a focus on client referrals and using social media as a marketing and client service tool.
Here are what a typical Accounting Excellence firm looks like in 2018 and examples of some of the growing trends that are nipping at the heels of the core set.
Unsurprisingly, the first core element is cloud. 88% of entrants noted cloud as being essential to their firm’s success. This percentage has skyrocketed since 2017 which has obviously been driven by the MTD effect.
Firmly embedded cloud systems in their firms, the use of cloud apps have in turn increased. While the percentage of firms doing this at 31% sits slightly below the one third metric we’re using to determine what a typical Accounting Excellence firm looks like, it’s clear that the trajectory of firms using expense capture and forecasting, planning and analysis apps will only become more prevalent. The percentage of firms doing this bubbled in the low 20% between 2013 and 2016, but again, the MTD effect changed that in 2017.
Referrals and business advice niche
Like cloud, client referrals are an important ingredient for the ambitious Accounting Excellence firm. At 76% of entrants, referrals continue to be used by firms as their main client acquisition strategy as well as a customer satisfaction metric.
The referral trendline has travelled alongside the business advice niche since 2013 (taken up this year by 67% of entrants), and has reasserted itself as a primarily marketing focus for the typical AE firm.
Shortlisted client service entrant Glenn Martin uses a “best year ever model” with his clients, where he builds the client’s dream business plan through conversations about their ideal year and then sets the parameters and benchmarks that they’ll have to hit. Martin confirmed the strong operational link between specialist advice and client referrals; success with clients in the North East hospitality industry led to more referrals and business from similar companies.
As a whole Accounting Excellence Award entrants devote a lot of attention to referrals, but they don’t always track or manage this activity in a systematic way. Those who can quote specific numbers for the sources of new business leads represent just 30% of the 2018 entrant population. Many of these practices use customer relationship management (CRM) systems for managing referrals, with impressive results - typically growing 1.5x faster than other award entrants.
Social media, websites and content marketing
A typical firm see social media and the web as vehicles to raise their profile and position themselves as expert commentators. There is a clear formula behind the wave of marketing activity that has engulfed the profession in recent years. If you have a website, you need to refresh it on a regular basis with new content. Optimising this material for the kind of people you want to attract will increase traffic and you can stretch your reach further by using social media to spread the word.
When shortlisted accountancy pioneer Adrian Markey became involved in cryptocurrencies, he put out articles, utilised SEO and social media to attract ideal clients and reinforce his expert credentials. Similarly, shortlisted small firm of the year The Accountancy Cloud uses content marketing to strengthen its position with tech-savvy millennials.
Mentioned this year by 45% of entrants, social media has doubled amongst Accounting Excellence firms since 2013, while content marketing has risen to 43%.
Typical firms use their social channels to impart advice and tips. Shortlisted small firm Spicer and Co uses Facebook, Twitter and Linkedin to promote events they attend and share clients’ posts. For shortlisted innovative firm Mazuma social media is part of its client service strategy, for example circulating any testimonials and using it as a way of measuring client happiness.
Newsletters and emails
Social media is one avenue to reach clients and prospects, but typical Accounting Excellence firms also dispatch regular newsletter emails through providers such as Mailchimp for a more direct marketing approach.
Newsletters have jumped from 8% of entries in 2017 to the core 33% of firms, cementing it as another attribute of the typical AE firm. In a profession creaking under the strain of constant legislative changes and tax updates, newsletters provide a non-intrusive, structured way to inform clients about these issues.
Shortlisted small practice firm Inca Caring Accounting has built up a opt-in database of 900 businesses, to which it sends emails explaining topics such as RTI, dividend tax and MTD.
Just over a third of 2018 entrants organise events of different kinds as part of their client service mix. For shortlisted client service firm the Accountancy Office an event can be anything from an invitation for a coffee in the area, to webinars and workshops.
The Peloton entwines events and client service to such a degree that it invites its clients to a Christmas party.
For medium-sized firms, events have become a surefire referral venture. Shortlisted medium firm Green and Co attracted more than 200 attendees to two events that aimed to demystify GDPR for clients and non-clients alike.
Beyond the typical
Of course, these typical behaviours are a foundation for excellence rather than its essence. Where the innovative pathfinders stand out is what they do on top of these standard activities. Rather than dabbling in these areas, they push them to the limit.
The firms who leave the 20 September award ceremony clutching an award will do so because they have discovered new approaches in areas such as flexible working, change management, learning and development, training and client onboarding. And the secret to their success is that initiatives like these don’t just sound cool, they deliver tangible results that can be measured in terms of client satisfaction.