June 10, 2019
Published: Journal of Accountancy
By Dawn Wotapka
When it comes time to grow their business and bolster their reputation, accounting firms often turn to recruiters to attract dazzling — and, likely, expensive — new talent. Perhaps a better strategy is to develop existing employees, according to Philip Palaveev, the founder and CEO of The Ensemble Practice LLC, a business management consulting firm based in Seattle.
“A lot of businesses recognize they need good people. They want to have talented professionals, but they don’t want to train them or develop them,” said Palaveev, who spoke Monday at the AICPA ENGAGE 2019 conference in Las Vegas.
That, he said, can be a mistake: “The best talent is the talent inside your own organization. Those are the people who are most loyal, who understand the culture and can relate best to your clients.”
Palaveev, a speaker and author of The Ensemble Practice and G2: Building the Next Generation, recommended these ways to nurture existing talent:
Invest time. It takes between seven and 10 years to fully develop a new adviser’s capabilities to the point where he or she is capable of both servicing existing clients and attracting new ones, Palaveev said, though that doesn’t mean you won’t see results along the way.
“You’re planting a tree, and you’re not going to see a full harvest for 10 years,” he said. “Many people, given that equation, prefer to buy the apples in the market, but ultimately that is not a sustainable way of having a profitable orchard.”
Develop people. Once you’ve identified employees to nurture, take the time to coach and mentor them with both short-term and long-term guidance and advice that can encompass both day-to-day issues and career planning.
“Every professional needs to be following in the steps of someone interested in their career. They need to spend time learning and shadowing,” Palaveev said.
Focus on soft skills. Most employees know how to get the technical knowledge they need, so focus on strengthening the skills that will help them become a complete professional, such as client-relationship management. They need to know how to truly listen to a client, ask the right questions, and deliver difficult news. “That’s an integral part of client services and an area of coaching and mentoring that’s badly needed,” said Palaveev.
Success in professional services often requires teamwork, so spend time making sure employees can manage and coordinate teams, Palaveev said. “It’s an integral part of the job,” he pointed out.
Teach business development. Palaveev labeled business development a “sore subject” for the industry because it is a skill that isn’t innate or easily taught, but is essential to business growth. “Every firm wishes they had more of it, but they don’t spend enough time sharing best practices for how business development is actually done,” he said.
“Firms make the mistake of either expecting results on day one, which is unrealistic, or never broaching the subject of business development until seven, eight, or nine years in, when it may be too late,” he explained. A better strategy, he said, is to begin involving professionals in the team’s business development efforts early on in their career so that they can learn and gain confidence along the way.
Mold career paths. Many employees leave organizations because they feel stagnant and think better opportunities exist elsewhere. You can help prevent this by working with employees to develop a detailed, step-by-step career path that can help manage expectations and keep everyone on the same page.
Offer equity. Palaveev is a big fan of the equity model, which he said gives employees incentive to work hard because they own a piece of the business.
“Nothing attracts talent like equity and ownership,” he said. “Accounting firms were built on the partnership model, and that really is part of their strength. If you have that opportunity in your firm, that’s fantastic. Use it because it’s very powerful.”