Trailblazer: Integrity Wealth Pty Ltd

I had a great conversation this week with Michael Stewart of Integrity Wealth Pty Ltd, outside of Brisbane, Australia.

I’ve known Michael since his days with Results Accountants’ System under Paul Dunn and Ric Payne. Then he was with Principa, and now is with Integrity as General Manager.

As of October 1, 2007, the firm eliminated timesheets. More empirical evidence that this is the wave of the future if firms are serious about operating effectively in an intellectual capital economy.

During our conversation, I asked Michael to provide me with a case study on his firm’s transition to becoming a Firm of the Future.

Here is his first installment, as he wants to add to the story in the future to inspire others:

Hello Ron.

Thank you again for speaking with me during the week. As is always the case when interacting with you, or your material, I left feeling further inspired; and also somewhat humbled—there is still much for us to learn and implement as students of pricing and value.

As agreed I’m sending this email now and if there is sufficient interest from the VeraSage community I’ll follow up with a more detailed case study. While getting rid of timesheets was just one step in an overall strategy to change our firm, it has proven to be a critical one. Not being an accountant myself I’ve never had to record my life in 6 or 10 minute units (and if I had I probably wouldn’t have lasted very long). So in some respects I don’t think I can really convey some of the differences it’s made to individuals within the firm. But I do know what it’s done for our mindset, how we promote the firm, and how both clients and team members react to a no timesheet model—and it’s all positive. Perhaps in a future email I’ll get one of the team to write their thoughts. As an example, Denise Gibbons (Partner) said to me recently “I used to make myself sick preparing bills for clients”. We don’t have to worry about that anymore, which in itself has to be a major win.

As a summary:

Practice Profile:

  • 2 partners + 11.5 FTE (includes our financial planning division)
  • 2006 revenue $645,000
  • 2007 revenue $735,000
  • 2008 revenue $1,180,000 (growth approx 50/50 acquisition/natural growth)
  • Approx 400 clients in Accounting division

We are located in Clayfield, Brisbane, QLD, about 10 minutes from the heart of the city. Over the past 18 months we have been working to redesign the business on many levels in order to create a place that will attract team members. The partners, Denise & Mark, were very keen to implement many things but like most firms were struggling to balance client work with internal goals. I joined full time in October 2006 with my focus being on establishing the strategy and infrastructure that would attract team members and allow us to grow. For a firm of this size to hire someone who does little or no client work was a significant decision, both financially and in terms of mindset—the partners were agreeing to hand over the day to day running of the overall business so they could focus on client work and development of the team.

We made the decision to abolish timesheets as of 1 October 2007. We had been talking about it for at least 9 months prior to that and had committed in writing to the team we would do it. There were many discussions on whether we should keep timesheets at the same time to make sure, well, to make sure the sky didn’t fall in I guess; or whether we should still record total time on the job to identify scope creep. Finally common sense prevailed, we chose to back ourselves, we took the leap, and haven’t looked back.

How it works:

  • All clients now receive an engagement letter with a fixed fee and a date for when their work will be completed. Typically the fee is based on last year + 10%. We review each job and the scope of the work before determining the price. Mark, the partner of the accounting division does the initial review. We then sit together and as Chief Value Office I challenge anything that has not seen a minimum 10% increase. (This is in addition to a 10% increase last year for most clients). Mark is right on the page with value pricing so he identifies any special work or areas in which we could add significant value. Though for most work it’s very similar year in year out.
  • We must receive the signed letter back from the client before work begins. Naturally there are some long-standing clients where we respect the relationship and we haven’t bothered trying to force an agreement upon them. So long as they agree to the price we’re happy.
  • We now ask for payment of invoice immediately upon completion of work, instead of 14 day payment terms. New clients often have to pay $1,000 upfront for us to review their work, then we quote on the scope and price of the work that needs to be completed. Again, the client must agree to all terms in writing before the work begins. We haven’t worried about moving to bill existing clients upfront. Instead we have focused on workflow—if we can get the job out the door quickly then we can invoice sooner. Then of course you need a system to chase debtors (receivables for our international colleagues).
  • We initially set a minimum fee of $1,000 for new clients. We have since moved that to $2,000 and will soon be increasing to $3,000.
  • We currently have just one KPI that has replaced timesheets—a monthly invoicing target. The entire accounting team are responsible for ensuring we make this target. I have set the budgets for the firm, Mark then looks at all upcoming work and selects the jobs to be completed each month. Then we just get on with it. If we make target, we know those jobs have been completed. Nice and simple.
  • Monthly targets are based on a combination of what we have invoiced for the same period in previous years; what the firm would have achieved on a hours x rate x productivity model; plus any price increases, allowances for special work or value priced engagements etc. In a firm of our size it’s pretty obvious if people are working hard or not. If productivity or workflow is lower than we believe it should be, it’s usually more to do with planning, getting the right people doing the right work, and resourcing, than it is a lack of effort by the team. In other words we believe people come to work with the intention of working hard; we just needed to get the planning and infrastructure correct so their efforts turned into outputs.

    To ensure I was happy with the monthly targets I conducted a financial analysis using Principa’s FirmPlan—I think it’s the best tool I’ve come across in relation to looking at the financial performance of a firms that record time. Within it I compared our numbers to some benchmarks, ran some what if analysis on impact of price increases etc. From there we picked an annual revenue figure, divided it by 12, made some adjustments to each month based on seasonal fluctuations, and targets were set. We have 15 years of history on what price our clients will pay for most of our work and how much work we can do in a given period—so even if that is based on a timesheet model it is a well established precedent and provides an easy starting point for getting rid of timesheets and quoting a fixed price before the work begins.

  • It’s important I point out how helpful our team, in particular our admin team, have been in adopting this change. For the professionals it has made life easier. Though for Barbara (admin, reception) it has created work. Who gets engagement letters; who doesn’t; changes to the system every other week as we learn new things; extra work in preparing engagement letters; updating the workflow system etc. We continually communicate why we are doing these things and we are very grateful that all of this has been handled with a minimum of fuss and we are a better firm as a result.

Ron, there will be many other things to discuss and share: strategy, vision, client selection, pricing, marketing, recruitment, post job reviews, successes, failures, things we have no idea how to approach, examples of value pricing successes, and comments about “accounting utopia” (more on that story in another email). This email is to get the process started. On behalf of Integrity I’d like to say a massive thank you to everyone who has shared their ideas with us and myself over the years. We hope our contribution is helpful to others who are heading down this path.

Ron, please feel free to publish my contact details in case anyone would like to contact me.


Michael Stewart
General Manager
Integrity Wealth Pty Ltd
Integrity Chartered Accountants & Business Advisors
Tel: +61 (7) 3262-3533

Thank you, Michael, and we look forward to more details on your firm’s transition.

Congratulations to the entire team at Integrity for blazing the trail for your colleagues—and all of those reluctant consultants—to follow.

This is truly Firm of the Future 2.0.


  1. Best sentence – “We then sit together and as Chief Value Office I challenge anything that has not seen a minimum 10% increase. (This is in addition to a 10% increase last year for most clients). ”

    Congratulations and more inspiration for me.

  2. Michael Stewart says:

    Joel, thank you for your comments.

    Brenda! Great to hear from you. More than happy for you to share this anywhere you think it might help.

    It’s been great to read about your progress. Congratulations and I hope all is going well for you.


  3. Hi Michael,
    I have a small accounting practice so I have a full-charge bookkeeper who is also my admin support. She will ultimately be doing admin tasks similar to Barbara when I switch over to value pricing, (which ideally should have happened yesterday – or last year). I understand that not all employees are considered knowledge workers. My question is this. Is Barbara considered a knowledge worker? Does Barbara fill out a timesheet?

  4. Cyndi,

    I know you didn’t ask the question of me but thought I would respond anyway!

    Absolutely she is a knowledge worker. Anyone in your organization who brings, adds or transfers knowledge is a KW.

    No one in our organization (Aries Technology Group) tracks time. We consider time tracking to be insulting to the KW.

    By the way, what the heck are you waiting for on changing your business model to value pricing? Don’t spend effort to justify the reasons or to answer the “How do I” questions, just do it.

    It has been a fantastic change for us in every respect.

  5. Hi Cyndi, lovely to hear from you. I’ll be able to reply over the next week, just juggling a few projects currently. In the meantime, would love it if you could share more on where you’re at and where you’re heading.
    Looking forward to hearing more,

  6. Hi John and Michael,
    Thank you for your replies!
    I’m doing it as fast as I can, trust me. I was only introduced to these concepts about two weeks ago when I attended Ron’s workshops in MD. I’ve got my attorney reviewing my new engagement agreement format now. I’ve got all my KW’s reading “Why Work Sucks…” which I just finished. (Sorry Ron, I know I read it out of order, but I needed to finish it first so I could share it with staff and get them opening up ASAP) We’ve already starting brainstorming how to make a ROWE work for our organization. I feel strongly that the change to ROWE and Value Pricing will be most effective if introduced concurrently, since they are so complementary. Now I’m starting Ron’s “Pricing on Purpose”, but in the mean time I’ve begun planting the value pricing seeds with certain clients, my team and my mentors with very positive response. I feel confident, yet really appreciate the support from members here. Thanks!

  7. Hello Cyndi.

    My apologies for taking a little while to get back to you.

    Whenever I read “when we switch over to value pricing” the hairs on my neck go up – it usually means people are making it seem so hard, when it is a very simple concept. So I was very pleased to hear you are doing it just 2 weeks after attending Ron’s session – congratulations, some firms take years! Whatever you do, keep it simple. Running a growing business is not easy and simplicity on as many fronts as possible helps on a day to day basis.

    In answer to your question … Before moving away from timesheets I interviewed each team member on their use of timesheets. As you would expect everyone had their own little way around the system – some would do it in 1 hour blocks at the end of the day; some days later; some didn’t know they had to (Barbara for example). This led me to question the accuracy of the system anyway. Plus, when it came time to do the invoicing, well, they used to look at last year, look at time on the clock, and typically end up somewhere in the middle of the 2. Which further made the timesheet system seem unnecessary.

    So, is Barbara a knowledge worker? I don’t know. I guess so. To be honest I haven’t worried too much about those sorts of terms, and have instead focused on looking at the scope of the work, determining where our pricing is in comparison to other firms and in relation to what we do and they don’t, and combining that into day to day operations so we can quote prices up front and get rid of timesheets. Now we have moved to a focus where the Accountants just need to worry about which jobs go out the door and when, and myself and one of the other Directors worry about how those jobs equate to a monthly invoicing target.

    Does that help?

    Again Cyndi, apologies for the delay – June?July was a little chaotic and things returning to “normal??” now.

    Looking forward to hearing from you and happy to help out in any way.

  8. Trailblazer: Integrity Wealth Pty Ltd..Great people are in this list..I learned a lot..Thanks..

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