5 lessons from 2020 that can transform your accounting firm in 2021

On top of that, clients were often anxious, requiring more advice and assistance than usual.

Thankfully, many firms had already begun the process of moving to more cloud-based practices, so the transition to remote work wasn’t as disruptive. 

But there were more lessons to be learned other than the necessity of remote work.

Here are five strategies that industry leaders are implementing in their firms—and how they can transform your own business.

1. Always plan for worst-case scenario

Even though things are uncertain, you can still implement a strategic plan—for your clients and your own firm.

And coming to terms with not being able to predict what’s coming up is a good place to start.

According to Kathy Gregory from LivePlan, “You can’t predict anything, but you can plan for just about anything and those firms that had planned best and worst case scenarios for their clients were the most successful in 2020.”

Once you’re comfortable with not knowing what to expect, take each of your clients (and your own firm) and create three buckets:

• Best-case scenario

• Worst-case scenario

• Current-case scenario

Ask yourself what each of these situations look like. What do they each require from you as an accountant?

By being prepared for different situations of varying severity, you’re likely to be less surprised or caught off-guard should the completely unexpected happen, like say, a pandemic that forces your staff, clients and the rest of the working world to work from home almost overnight.

You’ll have plan A-through-Z ready to fire when (not ‘if’) the time comes.

2. Always communicate with clients—even when there isn’t much to say

The normal expectation of communication between your firm and your clients all but disappeared in 2020.

People were increasingly anxious given the unprecedented circumstances and relied heavily on their accountants to update them and provide advice in simple terms.

But, for the most part, there was simply no concrete information to pass on to them.

How firms dealt with this, according to Jim Buffington, Advisory Services Leader at Intuit Accountants, set the successful ones apart:

“The firms that communicated as much as they knew often and early had much better experiences with their clients.”

Communicating as often and as clearly as possible with your clients, even with there is no solid and accurate information to share, is often enough to calm them.

Consider communicating via content marketing

Your firm can help grow its audience, develop all-important connections, and importantly, establish itself as a trusted industry-leader by shifting some focus towards your communication strategy.

Karen Reyburn, Owner & Managing Director at The Profitable Firm explains that the firms that made it easier on themselves in 2020 were the ones that “communicated to their clients via content. They wrote blogs, they sent emails, they recorded videos, they posted on social.”

By keeping your communication channels open beyond transactional communication with your clients, you’re helping to further instil confidence in your abilities and industry-position. 

This is a great confidence boost for your clients—and potential prospects.

3. You need the right tools to successfully manage a remote accounting team

The firms that made it out of 2020 quickly realized they needed the right tools and systems to adapt to the many changes and uncertainties.

Successful firms implemented the right tools to transition to (and manage) a dispersed team of accountants.

By employing tools like Karbon, firms were able to:

• Consolidate internal communication channels.

• Remotely collaborate across various clients and jobs.

• Automate manual tasks to increase efficiency.

• Gain a high-level overview of staff workloads to successfully balance incoming jobs, forecast accurately and prevent bottlenecks before they became a serious problem.

If your firm struggled in any of these areas, you might want to consider exploring workflow management tools.

4. Compliance services alone aren’t enough

Compliance will always be the core of an accounting practice. But firms that are creating the most value for their clients know that advisory and compliance must go hand-in-hand.

James Ashford, CEO & Founder, GoProposal, explains that the most successful firms are those with a balanced profitability structure:

“The firms that were really well-prepared for this and adapted to it started to ensure that every single service they provide could stand on its own two feet and was profitable in its own right.”

An unbalanced firm, for example, might look like this:

• Loss leader: payroll

• Golden ticket: advisory services

COVID-19 drew much more attention to payroll, given the increased focus and movement in leave and benefit entitlements.

As a result, businesses diverted their advisory budget to deal with payroll.

This was a huge hit for firms relying on advisory services as their moneymaker.

But, at the same time, advisory services are just as important as ever. 

Steph Hinds, Head Ninja at Growthwise, explains that whilst compliance services are always important, the disruptions businesses have faced have also opened doors to advisory services:

“As accountants we now have this opportunity to do more and more and more, and help our clients (to) really extend their capabilities.”

So, take a look at your firm’s current profit structure, and ask yourself:

1. Is there sufficient balance across advisory and compliance offerings?

2. What if advisory services stopped tomorrow—could you survive?

3. What if compliance services stopped tomorrow—could you survive?

5. Find the right team, keep the right team

If your team was aligned going into 2020, you were already in a favorable position.

Aligned staff members understand their companies’ strategies and mission. Unaligned workers simply don’t.

In 2020, teams with unaligned and disengaged staff saw resources diverted away from important issues and processes to survive the year. Instead, they were pointed towards re-stabilising a derailing train.

The trick is to have a clear plan in place, supported by carefully chosen technology that will solve any issues proactively.

You can transform your firm by becoming comfortable with the fact that hiring remotely will allow you to hire the best talent available anywhere—thus, helping you to secure the right team.

From there, it’s all about keeping the right team. A great structure to start with is:

1. Make sure you have the right tools to manage a remote team and keep them aligned

2. Set expectations, deliverables and responsibilities

3. Schedule regular catch-ups, encourage communication and collaboration 

4. Standardize processes

5. Gain the confidence to trust them

Learn more about how to manage a remote team of accountants.

Clients will come—there’s no shortage. So, make sure you have a top-notch team to service them and grow your accounting firm.

Learn from the past to transform the future

You’ll be best-placed to transform your practice’s future for the better by learning from the past. 

Ask yourself:

• What worked for your firm in 2020?

• What didn’t work?

• What are other firms doing to grow in 2021?

• What are the experts predicting for the next 12 months?

From there, take a look at your firm and:

1. Plan for best, worst and current case scenarios for your clients and your own firm 

2. Clearly communicate internally and externally

3. Hire for success

4. Ensure your profit structure is bulletproof

5. Have the right tools in place to make it all happen

So, how can you implement these strategies to transform your accounting firm in 2021?