RSS feedsIt is now a few months since I looked at the likely effects of an economic downturn on the accountancy profession and the areas where firms should be concentrating their efforts.
Since then, the economic forecast has not improved and even those practices that have yet to feel any adverse effects should be looking at their strategies over the next 18 to 24 months as they will undoubtedly feel the pinch.
I am not advocating a complete rethink, just adjustments that need to be made to suit the prevailing situation.
This should be a creative activity, not an analytical one. It is all about finding new ways of doing things that add value to the business and to clients, involving communication with and soliciting ideas from key personnel within the firm, not just the partners. They are working at the sharp end of the business. They see what is happening on a day-to-day basis, which puts them in a good position to make suggestions that are both practical and workable and which could make a difference.
An excellent way of ensuring all relevant staff have the opportunity to contribute is to establish focus groups to examine how the firm is managed and run in key areas such as departmental operations (the planning and turnaround of work), department profitability (fees, budgets and accountability) and IT (functionality, usage and effectiveness).
The wider consultation process has a number of advantages in addition to taking pressure off the partners and giving a broader view of the issues that need to be addressed and the actions required. Any downturn in the economy is a worrying time for individuals as well as businesses. Staff who feel powerless to affect their own destiny become demotivated and work will suffer. Giving them a degree of ownership of the situation has the opposite effect. Because their own ideas and actions will make a major contribution to their personal progress they will be highly motivated and enthusiastic.
Of course, the focus groups need to have sight of the firm’s major objectives. What we are looking for are a few nips and tucks rather than major surgery. The focus should be on what the firm wants to achieve, identify how this can be achieved and assign specific tasks to everyone. From this should arise an action plan complete with milestones and goals.
Ideally, one partner will be in charge of each focus group and will steer the process, challenge ideas where necessary and supervise the creation of a workable plan. Overseeing everything is the managing partner who will ensure that the individual plans from each group dovetail to create a workable whole.
The end result is a set of measurable goals for each area, action plans for everyone and a clear understanding of the resources and support they require.
Although many firms are currently feeling unaffected by the downturn, previous experience has shown that nobody can swim against the tide - it just takes a bit longer to catch up with some than with others.
Waiting until the water reaches your chin before starting to swim leaves you at the mercy of the elements. Taking action now will put you in control.
Phil Shohet is a director of Kato Consultancy
