MTD ITSA delay: Make passion your strategyby
A clear strategy combined with passion and focus facilitates innovation and helps business owners create what they dreamed of when they started out, writes Della Hudson.
Making Tax Digital (MTD) seems to have split the profession between those who have used it to forward their own digital agenda with the ensuing benefits to clients and those who have taken a more “wait and see” approach in the full knowledge that HMRC projects are always delayed.
At Hudson Accountants, and then again at Minerva Accountants, we used the MTD stick alongside the carrot of businesses having up-to-date numbers and the ability to invoice and take payment on their phones. Our strategy was summed up as: “Let’s do better business.”
As a business owner, my passion is to see other business owners achieving the business that they dreamed of when they first set up.
Passion is key
Passion seems to feature in a lot of the strategies of founders of smaller practices where personal goals often merge with business ambitions.
Bryony Thomas of Watertight Marketing is keen for everybody to have as much of their work as possible in the purpose/passion and profit quadrants, rather than just one or the other (and none in the quadrant that neither excites you nor makes you money). The areas to be avoided are obviously those clients and work that neither make your eyes light up with enthusiasm nor ring up the cartoon pound signs.
Sharon Baker of Kinder Digital Accountants believes that, if she runs her business so that her team and family are happy, then her clients will be happy too. Jo Copestake, sales director at Xero UK, thinks that passion is critical because it can inspire your clients too.
Pick your strategy
Our strategy was simple: first get clients keeping up-to-date digital records that would enable us to operate more efficiently internally, and then use the up-to-date information and time saved to do more for our clients. Other accountants choose to pass the efficiency savings on to smaller clients in the form of cheaper fees. Every practice is different.
Pam Phillips of de Jong Phillips shared the strategy to be the outsourced full finance function for all its clients. It does this by leveraging technology so that it can collaborate remotely and its has niched so that it is better to be an expert in what it does. It only works with agencies and with businesses that are on or are willing to move to Xero.
Find your ideal client
Having a clear idea of your ideal client allows you to focus your marketing on just those people. This means that you are in the right place for them and can speak directly to them. Some firms only niche their marketing while others niche their whole client base so that they can benefit from internal efficiencies and in-depth knowledge.
Phillips finds that by working only with agencies it really knows their industry as well as the common challenges they face (and solutions). It can then tailor everything it does to support its agency clients and focus only on learning about tech that agencies need. There is no need for it to learn about stock systems for example.
Sharing your strategy
This seems an obvious thing to do – share your strategy with your team so that everybody is clear on what the end goal is. We do it at Minerva Accountants, Phillips does it at De Jong Phillips and Baker does it at Kinder Digital Accountants. There is nothing to be gained by keeping your strategy a secret so share it widely so that everybody can contribute ideas.
If your team understands your strategy they can also fill in the gaps where you don’t have processes in place. They will be able to second guess what you would do.
More profitable clients
The key to finding more profitable clients is that it takes time. It may seem counterintuitive but spending more time with your clients can lead to higher fees.
De Jong Phillips finds that regular contact with its clients (daily, weekly or monthly calls as needed) means that it is close to its clients’ businesses and better able to get involved. Sharon has also found that its most successful clients are those who meet monthly to keep them on track with their action plans.
Where to start?
Mark Twain said: “There is no such thing as a new idea. It is impossible. We simply take a lot of old ideas and put them into a sort of mental kaleidoscope. We give them a turn and they make new and curious combinations. We keep on turning and making new combinations indefinitely; but they are the same old pieces of coloured glass that have been in use through all the ages.”
Phillips recommends finding ideas from elsewhere and making them our own. Start by reading business books or following other accountants to see what they are doing and sharing. You can also learn from experiences outside of the accounting practice.
Before working in practice she worked in decision support in an investment bank. When she started up de Jong Phillips, she wanted to bring that level of forward-looking financial support to small businesses.
There are plenty of resources out there and Baker also recommends collaborating with other accountants and learning from those who have already done what you’re trying to do.
There’s no need to reinvent the wheel in a profession where so many are willing to share and collaborate.
This article is an extract from our new editorial special report: “The practice innovation handbook”. Download it now to access expert advice and real-life examples to help you identify areas for improvement in your firm and make changes that will drive innovation and boost efficiency.
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Della Hudson was part of the class of 2009. She built up Hudson Business Accountants and Advisers from her kitchen table to a small team of flexible workers with independent premises in Nailsea, near Bristol. The firm ran regular Money Matters seminars and other training and webinars. Della sold the firm in 2017 in order to focus on the...