Some accounting firms have trouble getting work done and out the door on time. In my practice, we couldn’t get the work done at all.
I bought the practice in 2006 from its two owners who wanted to retire. I had been a staff accountant there and although I was a competent accountant, I had no previous experience running a business. When the partners left, the practice spiraled out of control. We couldn’t find files, we couldn’t find past returns to do current returns, and we couldn’t find the bookkeeping to do Workers’ Comp audits. It was chaos.
Additionally, I had three bookkeepers and a receptionist; none of them took any responsibility for anything. Everything fell to me. When the bookkeepers had completed their work, they wouldn’t tell me and they wouldn’t ask for more. It wasn’t that they needed direction from me, they knew what to do; they just would not ask for more work. Instead, they waited for me to give them more and did nothing until I did.
The receptionist was only willing to answer the phone and greet clients otherwise it was not her problem. I was the one who washed the coffee pot each day. Like clockwork, she got sick and had family emergencies during Spring break and tax season. When she left the practice to move out of State, we went through another five or six receptionists. They didn’t stay because they couldn’t stand the confusion and the constant calls from irate clients.
During the off-season, I worked 60 hours a week. During tax season, I worked from 6 a.m. to 11 p.m., seven days a week. After three years of rarely being home, my husband filed for divorce. In my absence, he had developed a close relationship with my teenage daughter who now hated me. That was my wake-up call.
After my marriage fell apart, I wanted a change. Already familiar with Sterling, I sent away for their DVD and got an introductory consultation into CPA practice management. In January 2013, I did their full executive program, which included management courses and tailor-made consulting. Then I asked Sterling to come to my practice and train the staff as they had an excellent record in accounting practice management. The training brought all the staff on board at the same time. Things started to get better fast.
Sterling started in on untangling the chaos in the practice and getting us organized. We determined the duties of each staff member and made them job descriptions. Previously, the staff didn’t know what their jobs were or what the other staff’s jobs were; now they do. Sterling laid this all out on an organizational chart, which we have hanging up in the office. Whenever a staff member has a question about who does what, he or she can look at the organizing board to find out.
We implemented the management by statistics system, which enabled me to assign a statistic to each employee to numerically judge their productivity. I was surprised to discover some of the people I thought were good producers were not; they were actually goofing off a lot. Since they had been so sweet, I had thought they were good staff. I had no idea that I had been personally carrying the firm on my own shoulders because I wasn’t managing my accounting practice.
Sterling advised me that the technical staff should be billing an amount equal to three to five times their pay. When my consultant and I looked at the numbers, we saw they were not even producing twice their pay in billable hours. Using Sterling’s personnel tests, I was able to replace the low-producers with creative, energetic and upbeat staff. Although job applicants can fool me in an interview, they cannot fool the tests.
I learned a lot about people and how to motivate them. Sterling taught me to utilize staff by having them do work which matched their personalities. For example, I had a very outgoing employee who I had put in a back office to do bookkeeping. She was miserable. I moved her to a position where she has to interact with clients regularly. She’s much happier and much more productive.
It has been almost a year since I started with Sterling in my CPA firm practice management course. In that time, my profitability—the amount of money that ends up in my pocket—has increased by 6 times. Now we get our work done and out the door on time. My staff don’t wait for me to tell them what to do. Instead, they are motivated and come to me with ideas and ways to improve our service to clients. We are about to open a second location. A year ago, the thought of opening a second location would have been inconceivable. And that is all due to Sterling’s invaluable training in CPA practice management.
Better yet, I am happier, less stressed and have more time for family and friends. But the most valuable benefit was one I never expected: my relationship with my daughter has completely turned around. We get along great. Even though she is now away at college, she calls me three to four times a day just to chat. I attribute the change in her to the change in me.