The Pain of Old Firm Management

This week, I attended a seminar where, to be frank, there were some arguments put that had me considering the option of tearing my skin off and rolling in salt – it would have been less painful.


Consider some of the points made at in one of the presentations at the seminar (and this is not an exhaustive list, my comments/thoughts are in italics):

  • You should get your “star performers” and keep loading them up with work as they get in front of the pack.  In effect, reward them for their great performance by loading them up even more and putting more pressure on them – what an incentive that is!;
  • Apparently, your WIP balance is a leading indicator for your firm (!) – not sure how this works, but some in the room lapped it up – how exactly is the WIP report a lead indicator other than for the bills you are going to raise at the end of the month which will be the cause of the client complaints in the month following?  So, maybe it is a lead indicator – of client complaints – the higher the WIP, the more complaints;
  • The seminal approach to customer happiness: “If you touch the client, you bill the client – for everything”.  This phrase reminded me of a discussion I had the other week with a somewhat more visionary firm in Adelaide.  They have some folk who are not all that happy not recording the time they spend working on/for/with/around their customers.  I asked them during the discussion “Do you record the time you spend thinking about your customers over the weekend or at night when you’re at home?”  Of course they don’t.  However, according to the approach being promoted, you should.  Work that out, or, better yet – set a budget for it!;
  • You need to budget for write-offs each month;
  • References to “fixed price estimates” – what, exactly, are these? I have been racking my brain about this – if someone can provide some clarity for me around this concept, I would be grateful;
  • Apparently, client satisfaction is important, “but we do have to make a profit though” – in essence, the firm’s goal is profit first – if that has anything to do with happy customers, all well and good.  To me, this seems somewhat arse-about;
  • You need to ensure that your clients understand that their actions reduce firm efficiency – OMFG.  So, we should punish the clients for interrupting our work – actually laughed out loud at this one; and
  • Clients need to pay for the inconvenience they cause – as it would seem that they are the cause of all the problems that exist in the first place.

According to the sage presenting this, “clients don’t understand how accounting firms work”.  Really?  Do they need to?

It was argued that firms need to focus on productivity and efficiency at any cost as these are your major drivers for profit.  You need to ensure that you are flogging the be-Jesus out of your people (they will apparently love you for it) and encouraging them to work harder so that you can load them up even more.  This bit I found offensive.  People are volunteers in your business – they can choose to turn up or not.  I hear many firms complain about staff-churn and turnover – any bloody wonder!  If your culture sucks, you get the team you deserve.  Culture is the result of the language, behaviors and focus of a business.  If these are all based around profit at any price, then they get the culture that supports that.  Won’t be happy or contributory or collaborative, but it will be, well, there.

I have been a willing recipient of the famous “Verasage Headache” on numerous occasions.  They are positive, challenging and serve to help me grow.

Unfortunately, the headache I received from this session was entirely different.  It is a headache based around people being measured on productivity and chargeable hours rather than on effectiveness and customer relationships.  It is a headache that resulted from arguing that the customer is there to be charged heavily and charged often – this based on the theory that any bill they get from you will be a good bill (driven, of course, by your “leading indicator” WIP report).

So, at the end of the session, I felt sad.  Very sad.  There were owners and managers of accounting firms in the room who were assiduously taking notes – picking up tips to make them better at flogging the crap out of their people and not really giving a shit about their customers.

Tim, our GM, was at the session with me.  His words at the end of it summed the whole thing up beautifully – “Pretty scary shit actually”.

The salt room beckoned.



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