succession

five ways to put success into succession planning

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a robust mentoring program can be critical.

three climbers helping each other up a hill

by bill penczak

legendary general electric ceo jack welch is reported to have lamented the choice he’d made in his successor, choosing someone based on their personality and ability to navigate the politics of the position instead of someone who could successfully lead the company into a brighter future. welch was correct. today, ge is a shell of its former self because of its leadership choice.

more: o.d. lanier: stepping into advisory | secret to success? a growth and abundance mindset | future firm growth requires a mindshift |the great resignation: five reasons accountants are quitting | five global cpa leaders: four survival strategies | planning for success in 2021 | do you have the guts to beat the covid crisis?
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welch’s one gaping failure as an otherwise stellar executive started me thinking about the current state of baby boomer-led and owned cpa firms, and how many of them are likely to commit the succession errors of ge. or worse, do nothing at all in terms of creating and sustaining a cpa firm into its next iteration.

as firms are giddy with the prospect of a new year and with covid in our rear-view mirrors, here are five considerations for generational succession of a middle market firm:

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from tax to transformation

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transformation talks: paul mueller, cpa, took a leap of faith when he left a national accounting firm at the apex of his career to start a new firm serving small- and medium-sized businesses.

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center for accounting transformation
center for accounting transformation

transformation talks
with bill penczak
center for accounting transformation

paul mueller was at a crossroads. as a national manager for the tax group of a large firm, he should have felt like leonardo dicaprio, yelling, “i’m the king of the world!” yet, something just wasn’t right.

more: five lead generation mistakes to avoid | five post-tax season growth ideas | five better ways to say no | are you solving your clients’ problems? | five ways to grow: talent new service lines | business development and sales aren’t scary
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today, he is the managing director of his own firm, mueller pye & associates, cpa llc in loveland, colo. his is a story of a late-life career transformation.

takeaways

  • there is life—a really fulfilling one—after a departure from a large national firm into a small firm in rural colorado.
  • in order to effect transformation either as a firm, or as a professional, it’s important to have a support network you can trust and open up to about your challenges
  • while firms do a great job of advising their clients on succession planning, that’s not always the case for themselves.

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what happens when you don’t push work down

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pile of documents on desk stack up high waiting to be managed.“stop defaulting to asking every talented person you have to work more hours doing stuff other people can and should be doing.”

by tommye barie
the succession insitute

as we said in our previous column, why you must constantly push work down, we are talking about how firms will need to alter their thinking regarding outsourcing, administrative support and the administrative time of partners and managers. we discuss how the lack of delegation impedes competency development, why partners working more hours end up creating a weaker bench, and more.

outsourcing

in this case, we are talking about outsourcing offshore. for many years, firms turned away from this idea because of the fact that they need to inform their clients that the services they provide were not 100 percent made in america. and most of our firms would say something like, “our clients won’t tolerate us shipping their data overseas” or “our clients will leave us if we outsource some of our work to india or china.” both of those statements continue to be proven wrong every day.
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why you must constantly push work down

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woman in business attire with papers flying around behind her backnew staff won’t work the hours you did. forget that notion right now.

by bill reeb and dominic cingoranelli

as we work with firms throughout north america, one of the most constant, critical issues we find is that of staffing gaps. those gaps are manifested in shortfalls of billable hours, as well as shortages of people, and a lack of critical competencies of people – all at various levels throughout the firm.

more on performance management: when the inmates are running the asylum | the two most common management styles | different roles for different partners | how big ‘books’ hurt firms | developing a three-year vision [video] | more merger questions than you imagined | mps: how to elect them … and fire them | partners as role models: the good, bad & ugly
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in these situations, we tend to find that often the partners, and sometimes the managers, are billing too many hours. meanwhile many staff, especially at the lowest levels within the firm, consistently are missing their billable hour targets.
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succession issues stalling some m&a

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four businesspeople, left handshakeowner agreements are seeing updates.

by terry putney
rosenberg map survey

the level of activity we’re seeing in m&a deals is unprecedented.

more from the map survey: firms focus on profitable growth, true leadership | survey: many firms in transition | technology playing center stage in cpa profession
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many firms in larger markets are often approached directly by firms interested in discussing a merger. the days of discreetly pursuing an affiliation strategy appear to be waning.
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technology playing center stage in cpa profession

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woman using midair interfacealso: retirees who want their buyouts had better transition their clients.

by marc rosenberg
rosenberg map survey

anyone knowledgeable about the state of the cpa firm industry would agree that technology is playing center stage

the potential of blockchain, artificial intelligence and data analytics is set to transform cpa firm technology in the same way that previous blockbuster inventions – pcs, laptops, the internet and software – did that almost instantly made obsolete the manual work cpas painstakingly performed for decades.

every year, the authors of the rosenberg map survey ask the industry’s top consultants to share their observations of what they are seeing at cpa firms. specifically, they are asked the following questions: read more →

3 ways firms scare off successors

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man in suit pointing thumb downand 7 steps to making ownership attractive to new leaders.

by terrence e. putney
bridging the gap

buying into a firm as a new owner involves great opportunity, but also significant risk. it is reasonable for ownership candidates to evaluate the potential for professional and financial rewards before taking such a step.

more: sponsorship: barrier to exit for diverse talent | use collaboration technology to improve your firm | 3 ways to keep your team members connected, engaged and energized | growing, developing future leaders is a two-way street | a winning culture is an intentional culture
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therefore, firms must be willing to honestly assess the potential risks and benefits for candidates as they seek to attract new partner-owners who can contribute meaningfully to the firm’s continued success.
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6 questions for planning your succession

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august aquila: "holding on too long is the most serious sin you can commit."make your planning spell success.

by august j. aquila

it’s no surprise to anyone thinking about retiring or selling a practice today that the number one issue they face is finding someone to take over the practice.

more on great partnerships: 7 issues in partner retirement planning | solving underperforming or dysfunctional partners | the 3 types of partners you need | how mps can make a real difference | 5 reasons that leaders fail | 11 things all partners must do | why partners need written goals
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there is a definite shortage of buyers and those who are buying are becoming more and more selective. many firms will find that it has now turned into a buyers’ market.
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10 steps to transitioning to a new mp

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senior businessman and another businessman talkingplus 4 questions to answer if the mp is staying with the firm.

by august j. aquila
what makes a great partnership

one of the most difficult events that a firm faces is the transition of power from one managing partner to another, especially when it’s the first time.

more on great partnerships: 5 ways to keep your edge | 5 reasons that leaders fail | 11 things all partners must do | why partners need written goals | the 6-step plan for transitioning clients | fighting restraining forces | chemistry and mutual respect matter | great cpa firm partnerships begin with trust | the 4 best ways to use pre-retirement partners
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knowing when to pass the baton and how to pass it are critical decisions every firm will have to make.
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survey: next generation balking at buyouts

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"partnership" written on two connected puzzle piecesm&a doesn’t solve succession problems.

by terry putney, transition advisors
the rosenberg map survey

succession for retiring partners continues to be a pressing issue for many mid-size and small firms.

more from the survey: many firms have already lost the battle with succession | embracing new technology a must | technology will solve labor shortages | cybersecurity grows in importance | don’t just win work, figure out why | mergers keep racing forward  | map survey top 10 findings
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this is not a new trend. it is amazing how many firms are delusional about their prospects of remaining independent, while doing virtually nothing to address the core issue of acquiring and developing the talent necessary to build the new generation of owners.
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many firms have already lost the battle with succession

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older businessman sitting at desk smiling as wall clock indicates 5 minutes to retirementdoomed by outdated retirement formulas.

by carl george
the rosenberg map survey

firms are continuing to struggle with succession of the partner group exiting the profession.

more from the survey: recruiting and retention are challenges | technology will solve labor shortages | cybersecurity grows in importance | don’t just win work, figure out why | mergers keep racing forward  | map survey top 10 findings
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while i would hope these issues are being resolved, i really wonder if it’s not too late for many.
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time is running out for succession planning

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digital visualization of a blue alarm clockbonus: 22-point m&a due diligence kit.

by domenick j. esposito
8 steps to great

much has been written and discussed regarding succession planning at cpa firms driven by the vast number of founders, leaders, and rainmakers who are retiring at a record pace.

more on strategic planning: expand your national and global geographic reach | using a high-performance business framework | what a client service plan can add | 36 consulting services you might be overlooking | how to drive consistent partner behavior | cpa firm partner performance: different activities, different metrics | develop the partners you already have | how many partners do you need?
goprocpa.comexclusively for pro members. log in here or 2022世界杯足球排名 today.

key takeaways in this post:

  • mid-market sustainable brands generally combine practices as opposed to acquiring or buying practices.
  • spend time to make sure it feels right.
  • the easier part is getting the contract signed; the harder part is the integration of the two practices and to make sure 1 + 1 at least = 3.

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