How to Be a Great Partner Steve Erickson

How to Be a Great Partner! Steve Erickson National Consultant to CPA Firms

Questions • Interactive • Exchange of ideas • Valuable information

Objectives • • • Improve your value and effectiveness Promote a client service culture Build your team and your practice Enjoy your career Have more fun Realize true Work/Life Success™

CPA Firm Value Enhancement Process Copyright © 2012 Steve Erickson LLC TM

Qualities of a Great Partner • • Respected by partners, staff & clients Focused on client service and results Creates value for others in the firm Enhances the reputation of the firm

Respected by partners, staff and clients

Executive Presence • • • “Present” Listens Less judging Positive Offers constructive ideas and solutions

Approachable • • • Predictable Behavior Integrity Helpful Considerate of others

Accountable • • • Do what you say No Excuses Manage client work Manage intake processes Focus on mutual success

Trust-Benefit Cycle Intentions Conversations Action Mutual Benefit © 2012 Steve Erickson LLC 10

Focused on client service and results • • Meets Commitments Communicates timely Technically Excellent No surprises

Managing Client Expectations • • • Timing Required information Pricing Change orders Discussion outline

Billing • • Become a great biller Value your time and services Don’t quote fee ranges Communicate early and often – Status of work – Fees – Offer alternatives

Engagement Letters • • • Scope Change orders Credit policies Scheduled payments Budgeted payment plan

Strategy and Value $ Specialty Commodity Leverage www. Steve. Erickson. CPA. com

Cognitive Process • Psychological processes – Acquisition and understanding of knowledge – Formation of beliefs and attitudes – Decision making – Problem solving

Value=Better Decisions Client Partner

Trusted Business Advisor Resources • Clients for Life • Power Questions

Revenue Management • • Timing Pricing Industries Functional services – Tax – A&A – Other

Strategy and Capacity Revenue $ X X X January through December www. Steve. Erickson. CPA. com X Expenses

Strategy and Capacity Revenue $ Valuable Work X X X January through December www. Steve. Erickson. CPA. com X Expenses

Strategy and Capacity Revenue $ Less valuable work X X X January through December www. Steve. Erickson. CPA. com X Expenses

Strategy and Capacity Revenue. Capacity Utilization Contribution Margin Rate $ X X X January through December www. Steve. Erickson. CPA. com X Expenses

Cost Per Hour • • • Annual salary Benefits Total Charge Hours Cost per hour $60, 000 $15, 000 $75, 000 1500 $50. 00 www. Steve. Erickson. CPA. com

Meaningful Measures • Contribution margin – Per hour – Per Month – Per client – Per partner www. Steve. Erickson. CPA. com

Passive Management • Measuring after the fact – Firm results – Job success – Individual performance • Less ability to influence the results – Lower utilization – Lower profitability

• Target Profit Planning for Partners – Budget profitability – Assign responsibility – Hold accountable – No surprises – Sample plan

Key Drivers of Strategy, Differentiation & Profitability Competitive Products Client Service Relationships Source: How to Maximize Fees Alan Weiss, PH. D. 2008 Distinct Breakthrough

True Differentiation • Distinct client service – Match service to expectations – Make the routine special • Ask the most important question!

The Question • What decisions do you have to make in the next: – Month – Quarter – Year – 3 years – 5 years

Creates value for others in the firm • • Facilitates succession Shares knowledge Marketing/Client acquisition Helps others in the firm be successful

National Survey • Career Development Survey – Over 1800 responses – Proven research

Survey Demographics Current Position 600 500 400 300 200 100 gr M Sr. M an ag er . Su pv or ni Se ff St a ra Pa Ad m in 0

Survey Demographics Size of Firm 0+ 10 00 25 0 - 50 10 12 00 51 -1 -5 0 26 -2 5 11 1 -1 0 700 600 500 400 300 200 100 0

Rating of Motivators

Management/Staff Engagement Strategy Annual plans Coaching Career Development Focused on success • •

Supervision • Behavior – Coping – Expressive • Supervision – Direct – Supportive

Firms will embrace coaching for improved performance Copyright © 2011 Steve Erickson LLC

Enhances the reputation of the firm • Civic minded • Participates in professional organizations • Personal reputation

Be a Great Partner Manage client expectations Manage staff expectations Become a great biller Be a person that is easy to do business with • Enjoy the ride! • •