Have the big firms got it all wrong?

Of course not. What an insolent question.

Seriously – the way they are structured works for them. That’s why they continue to grow. But, what about all those ambitious professionals who work for the big firms? Are some of them round pegs in square holes? Inevitably.

There are plenty of advantages of working for big firms and equally there are plenty of advantages of working in smaller firms or just by yourself. In part your choice depends upon your priorities and the factors that matter most to you. This much is obvious and the recruitment consultancies are well placed to help candidates appreciate the key differences between the firms.

So what am I leading upto here? Well, it’s linked to a new venture I’ll shortly be launching; but more of that nearer the time. For the moment let me ask why so many ambitious professionals stay working as directors or senior consultants/managers with the larger firms even when they learn that their career ambitions are not going to be met?

Obviously one key reason is financial stability. Another may be fear. The understandable fear of having to prove themselves in a new firm or of starting up by themselves, being reliant upon their own ability to find and service work and the lack of financial stability that accompanies self employment.

In the meantime the larger firms continue to charge high fees for the work done by these ambitious professionals. These firms have enormous overhead costs which have a big influence on their charge-out rates as do the profit margins demanded by the partners at the top.  The structure of these big firms may benefit their largest clients, but everyone else?

The big firms charge ‘High’ fees as in, whatever seems commercially sustainable given the kudos of the firm and the credibility that the firm name implies. And clients come back, partly because of the old ‘no one ever got sued for buying IBM’ approach. If those same ambitious professionals were to leave and set up by themselves how many clients would follow them? Not many perhaps. If they did would they get the same quality of service? Maybe not – as there would be no ‘four-eyes’ review process, less chance of the adviser checking things with colleagues and less PI cover in the event of a problem.

How big a problem is any of that really though where the adviser is only providing consultancy advice as distinct from running a team, arranging an audit or otherwise reliant upon support and input from colleagues and junior staff?

And of course if the consultant was providing consultancy services on his/her own account he/she could charge his/her clients lower fees and get to net a much higher proportion of the fees than he/she does as an employee of a larger firm.

I would welcome feedback on this blog please, especially as to the reasons why you have stayed with a big firm or the reasons you started up by yourself. Many thanks.

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Why is anyone Hired or Fired?

Years ago I was told that People are hired because they are liked and fired because they’re not!

Whilst this maxim is no doubt true in many cases I think it does not reflect what really happens in many professional firms. That is that people get hired because of their perceived technical skills and knowledge. Their personal attributes are also important and these will often take priority when it comes to deciding whether or not the individual is going to make partner.

Being technically brilliant and highly chargeable will often help you move up the ranks but it will rarely enable you to achieve partnership. Occasionally it will be enough but more often than not, to paraphrase my opening comment, People are only invited to become partners if they are liked.

Ok. I know that’s very simplistic. It’s worth reflecting on though as the apparent headline reasons that people are invited to become partners are almost always a reflection of the individual’s likeability. eg:

  • A big portfolio of clients that would go elsewhere with the individual if they left;
  • A proven winner of significant profitable new work from new clients;

What personal criteria can you think of that enable people to be made partner and which do not rely on them being likeable in one way or another?

And what have you done today to help reinforce your own likeability?

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Are accountants the only ambitious professionals?

When I started this blog I avoided focusing solely on accountants. This is quite simply because most of the information and advice that I share is equally applicable to those practicing other professions too. Some of it is even drawn from work with lawyers, barristers or surveyors.

Beyond this blog however, most of my work involves helping accountants – in practice, in  business and in public service.  It seems reasonable then that at least occasionally I should be able to make specific reference to accountants. Having said that I would welcome feedback from any non-accountants who regularly read this blog.  Are you real or just figments of my imagination and dreams? 😉

As regards Accountants I was very touched recently to note that this blog was included in a feature on AccountingWEB about practice development networks.  Towards the end of the piece the author, Nigel Harris, states that:

A new development of the 21st century is the blog. Practice development experts have been quick to use blogs to communicate with their target market, and noteable among them and well-worth reading are:

  • David Maister, widely acknowledged as one of the world’s leading authorities on the management of professional service firms – or so his blog reckons, but with titles like the 1993 classic ‘Managing the Professional Service Firm’ to his name there is some justification in his claim.
  • Practitioner-turned-consultant, and regular AccountingWEB contributor Mark Lee.
  • Ric Payne has his own Make a Difference blog on the Principa website.

I consider myself to be in very good company there and hope that the  feature leads to more readers of this blog which I will continue to populate with constructive, commercial and creative ideas drawn from my 25 years in practice and my talks, training courses and mentoring programmes.

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Is it Fear of Facebook?

I’ve just penned the following letter to Accountancy magazine – and guess it’s self explanatory. My apologies that this then becomes another blog posting about Facebook.

  • In June I introduced the subject under the title, Facebook for professionals;
  • At the start of July I commented on the need to be aware that what you post on Facebook could work to your detriment when you’re looking for a job or to make partner – and equally that employers and managing partners might want to look at Facebook as part of their Due diligence check on prospective recruits and partners;
  • Later in July I picked up on comments about Facebook and professionals on the HR capitalist blog.

Anyway – here’s the letter to Accountancy:

I spotted the short item ‘Fighting Facebook’ in the September issue following the ‘Facebook Frenzy’ article that appeared in the August issue. You noted that a large proportion of City firms are reported to have banned staff from using Facebook in the office. The mainstream media seems keen to dramatise this issue and it is certainly starting to come up in my conversations with accountancy firms.

We’ve seen the related knee-jerk reactions before and it is, I think, all about Fear . Originally it was just ‘No personal phone calls’. Then with the advent of the internet it became ‘No personal emails’. More recently, ‘No instant messaging (eg: MSN/Skype)’ and ‘No texting’. Fear of the unknown perhaps? Fear of technology we don’t understand or use ourselves?

In practice restrictions like these are often imposed by responsible employers to ensure their staff do not steal time for which they are paid to work. Personnel handbooks make clear that non-business activities should be avoided during the working day but in reality as long as no one takes liberties, no one makes a fuss. The same rules should simply be applied to posting, emailing and communicating on social networks as this is no different really. And we must remember that Facebook is just one such site out of dozens if not hundreds that exist.

Total bans on accessing one or more such sites will be as counter-productive as would be confiscating all mobile phones from staff to prevent them reading and sending personal text messages.

Indeed, in the same way that some clients now text info to their accountants, so there is an increasing cross-over between work and social networking sites. This further complicates the position too.

Mark Lee

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Five steps to winning the war for talent (part three)

In parts one and two of this series, I summarised the first four steps that accountancy firms and other ambitious professional service firms need to consider if they want to attract and retain the right people to work for them.

Having made a job offer and had it accepted we can now move onto the fifth crucial stage that is often overlooked. It also provides an opportunity to enhance the interview process itself.

Before I summarise the fifth stage, please bear with me as I reflect on a relevant experience I still remember from over twenty years ago.

It was the first day of my new job as a senior manger in a 12 partner firm of accountants. I was in my late 20s and I immediately knew I’d made a mistake in accepting the job offer. I had been met by the partner who had recruited me and was led up to the third floor of the offices where the other tax staff worked, well away from the rest of the staff. I arrived to find a pretty empty office, save for a filing cabinet, a chair and a desk which was piled up with files. Thereafter I was pretty much left to my own devices. Ok, I had, and still have, enormous reserves of initiative but both I and my recruiter had over-estimated how much I could do without any real guidance or support. I knew I’d made a mistake and considered going back to my previous firm almost immediately. In the event I stuck it out for 6 months before taking steps to move on.

5 – Induction. You never get a second chance to make a first impression. Over the last twenty years I have been a great advocate of induction packs for new recruits. These can be separate packs or supplemental to the statutory HR and payroll related material. The ones I have used are generally simple checklists with space for ticks and dates. Essentially they identify all the things, under various headings, that a new recruit (for the role in question) would need to know. Even in very small offices the amount of information that new recruits have to assimilate can be daunting. The checklist can become a prompt (reviewed as part of the induction process, over the first weeks and months) to help provide a balance between spoon-feeding and leaving the new recruit to use their initiative all the time.

The real value of such a checklist though is actually during the interview process. You can show it to the candidate to evidence your commitment to an effective induction process. Its mere existence can help evidence that you are not making empty promises about how you do things and how you care about your staff’s personal development and training.

Conclusion

So there we have it. Five simple steps that can help you win the war for talent. As a mentor to ambitious professionals I would be delighted to work with you to elaborate on each of these points.

Equally you may want to go one step beyond your competitors and evidence to potential recruits your genuine commitment to their future personal development. Imagine the impact of promising them that as part of their induction they will receive 6 or 12 months mentoring by an external expert who operates completely outside of the firm’s political processes and whose only task is to help with their ongoing personal and management development. I’d be delighted to discuss with you how this could be arranged.

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Strong technical skills are not enough

Taxation 2 Magazine often includes useful tips for ambitious (tax) professionals. Most of the time these are relevant to a wider audience too. The current issue (7/9/07) contains an excellent piece by Sheila Mandel of BLT in which she notes that

“The emphasis on marketing and relationship building has resulted in the existence of (and need for) more well-rounded ‘all singing, all dancing’ business types…. tax is no longer confined to the backroom!”

I would agree. Whilst exam training focuses on developing technical skills most firms and corporate employers need tax managers and partners/directors who also have a broad mix of business skills. As promotion is likely to depend upon such skills there are essentially only four options available to an employer.They will either:

  • pray, hope or make a wish that you magically develop all the necessary skills so they can justify promoting you;

  • send you on a range of generic personal skills courses and pray, hope or make a wish(!) that you pick up and practice sufficient tips to make the time and effort worthwhile;

  • arrange for you to receive personal, tailored mentoring that overcomes the problems inherent in the “courses” approach;

  • recruit someone else who already has proven business skills across the board.

Some employers combine the last two options and arrange mentoring as an additional benefit to attract potential recruits.In such cases the mentor is usually an independent third party; this evidences the firm’s commitment to the new candidate and will be a positive supplement to the firm’s conventional induction process. Ok – I admit it. I would say that wouldn’t I!

Such mentoring can be equally motivating for managers, senior managers, directors and even junior partners where traditional ‘hopes’ and courses have not enabled them to yet achieve their potential or to be as profitable as might be ideal.

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Five steps to winning the war for talent (part two)

In part one of this series, last week, I summarised the first two steps that accountancy firms and other ambitious professional service firms need to consider if they want to attract and retain the right people to work for them.

After those two preparatory steps we can now move onto the interview stage and what follows on from that:

3 – Positive Interview experience. Obviously you need to clarify whether the candidate has the skills and talents you require. Effective interview technique is critical and other assessment tools may be helpful too. My focus here though is on what you say and do to ensure the candidate will accept your job offer if you decide to make one. In the final part of this short series I will outline an idea that can also be used during the interview process to evidence your commitment and that you’re not making empty promises.

Equally if you have a two stage interview process you want to endure that your chosen candidates will want to come back for part two. This all involves clarifying what matters to the candidate, ie: what are their aspirations, motivators and needs? Do not make the mistake of thinking it’s all about money.

4 – Immediate follow-up. You need to strike a careful balance between apparent desperation and genuine interest. I used to write to candidates directly as well as feeding back through the agent that I had enjoyed the interview and thought it was worth taking things further.

I will outline the fifth step in the final posting of this series next week. In the mean time I would welcome comments and suggestions as regards the third and fourth steps I have summarised above.

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Five steps to winning the war for talent (part one)

Accountancy firms and other professional service firms have long been competing in what has become known as the ‘war for talent’.

I’ve never liked this epithet but the only alternative one hears (the ‘battle for talent’) also sounds as if it belongs in a bygone era and is more relevant to the armed forces than to those providing professional services to their clients.

The war and battle descriptions reflect the difficulties that firms have in recruiting the people they need to provide the service they have promised to their clients. These recruitment needs may be a consequence of growth plans for the firm or merely an effort to replace professional staff who have left for pastures new.

I’ve interviewed and recruited many dozens of professional staff over the years. It seems to me that there are five key steps to getting the right people on board – and to stay.

1 – Beforehand – specifying the talents, skills and experience required. This requires more thought then merely assuming that you need to find someone who can fill the shoes of the person who has left. Remember too that the key criteria will probably change if work is reallocated after someone leaves and before someone new joins.

2 – Attracting the right people – whether you run ads yourself or you engage an agent, you need to identify and highlight those features, benefits and advantages of working at your firm that will make your vacancy more attractive than those in other ‘similar’ firms. What are the real differences? Do you know or are you going to make the same broad assumptions, promises and assertions that the other firms make re your firm’s atmosphere, approach, absence of long hours, work/life balance? What can you do to prove your assertions are based on fact?

I will outline the remaining three steps in subsequent postings over the next couple of weeks. In the mean time I would welcome comments and suggestions as regards the first two steps I have summarised above.

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