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Knowing them, knowing you

A year ago we wrote about the increased level of client communication required to steer through the pandemic – and how this was being undertaken using online tools such as Zoom and Teams. But how can you sustain a level of support? What should your approach be from a strategic and operational point of view? 

Knowing them, knowing you
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  • Richard Sergeant
  • June 10, 2021
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Through a tumultuous and occasionally fraught 2020, accountants managed to supply their clients with a degree of certainty. Providing a safe harbour to look at the impact of a difficult trading environment, and to navigate the government-backed schemes has been invaluable for businesses, but put many practices under strain.

The pressure to understand a deluge of information, and then disseminate it meaningfully was greatly helped by digital communication such as Zoom and WhatsApp. But the longer-tail work with clients to help them through their particular circumstances continues to this day. A level of support which may have been necessary in times of crisis, but is not necessarily sustainable as part of any ‘new normal’.

In the view of Alan Woods, director of Woods Squared, “relationships with clients have never been stronger due to the higher frequency of interaction. While I hope the closeness remains, it needs to be more manageable”.

There are trends appearing around how firms are taking the learnings from last year to create a more sustainable model.

‘Right fit’ clients

Peter Watkins, director of Blue Penguin, is an advocate of working with clients that fi t you best. “Some clients weren’t really a good fi t, purely because they were in industries we had little experience of. We now work almost exclusively with service and professional businesses, which means they all broadly have the same needs (Covid or otherwise) and stops us spreading ourselves too thin.”

Providing services that work

Building on this approach of providing for the right kind of client, Glenn Martin, owner of Avery Martin, has also ensured they are focused in the right areas. Martin explains: “Those that were not just compliance-only clients pre-Covid fared better through the crisis, and have seen the benefit of working closely with an accountant. To sustain this, we have had to reduce client numbers but provide a far greater level of service. The 30% increase in additional services, including a business plan, forecast and quarterly meetings, has off set the reduction in compliance work.”

Helping clients to help themselves

Getting to grips with each clients’ individual plan has been essential for Woods too, however he has taken the opportunity to educate them on how to monitor and take action on their own numbers. “In the last 12 months we got the answer to the question ‘what are advisory services?’ “In its simplest form, it’s helping them to review their numbers, make the best decisions possible as a result, and then monitor and measure the impact.

The more we have done this in collaboration with clients, the more in control they feel and the less dependent they are on us.” Although a little knowledge can be a dangerous thing; providing a simple framework, like monitoring a set number of KPIs, can accelerate engagement with the numbers that matter - increasing ownership and allowing them to take action sooner.

Let the technology do the heavy lifting

Woods also stresses that while having the right systems in place makes this much easier, their main benefit is to allow you to spend your time where it has the most impact.

“We’re clear that using technology to create a sustainable model means getting systems and processes in place to do the work. “That means we can spend time speaking to clients about the things that matter to them. I don’t think you can replace experience and as business owners ourselves we want to be adding as much value as possible.”

This reflects the importance of tech, but as many accountants know, it’s the interpretation and understanding of the data that clients actually value. With this underlined in recent times, doubling down on effective and appropriate apps should be aimed at giving you more of that time back.

Concentrate on your own performance, too

While thinking about how clients are monitoring and planning for their future success, so should you too. Mark Lloydbottom, a practice management consultant, has been working with firms around thinking about their own performance: “As we move into a different phase, accountants should be taking stock of some of their own measures of performance and in particular capacity, profitability and capital.”

Lloydbottom explains that progress towards sustainability is measurable and actionable:

Capacity Having a clear understanding of capacity is essential. Firms should seek to attain a margin of at least 20% to allow for new clients and having the ability to add in advisory services into the mix.

Profitability The profit and loss account has limited value. Lloydbottom encourages firms to focus on managing gross margin by monitoring the revenue per billable hour on a monthly basis. Keep this heading ‘north’ and the bottom line will similarly respond.

Capital for investment Capital is essential if firms are to meet the tipping point from being a purely compliance-based business towards maximising the advantages of becoming more involved in interpreting the numbers and giving real time business advice, Lloydbottom concludes. The future, therefore, is about having a sustainable model that maximises your own profitability, lets you better serve clients, and reduce the amount on your shoulders.

Richard Sergeant is a freelance journalist


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