Not every accounting firm wants to grow — and that’s fine, provided they can keep the revenue coming in and stay ahead of various kinds of attrition (among partners, staff and clients). If they can do that, they can keep making the money they make doing the work they do for the clients they have.
Other firms want to grow — and that’s fine, too, provided they’re ready to do all the things that growth requires. The problem is that all too often, partners and owners don’t realize that growth isn’t simply a matter of doing more of what you’re doing now.
The editors of Accounting Today had a chance to sit down recently with Jen Leary, the CEO of CLA — a firm that has quintupled in size over the past decade — and she put it like this: “It’s important when we run the firm that we understand the best way to do that now — and then we’ve got to break it and we build it again. That’s how you avoid leveling out,” she explained. “There are a lot of firms that will stay at $20 million, they’ll stay at $100 million, they’ll stay at $200 million. And the reason is that it is hard to break something that is OK in order to build for the future. Why mess with it, right?”
It’s fine not to mess with it — unless you want to grow, because growth, unfortunately, means change. And it means different levels of change at different points of a firm’s life cycle. For a small firm, for instance, the primary outcome of growth might be the need to create an HR function to handle your larger staff. For a midsized firm, growing to the next level might mean changing how you manage clients — it might even mean culling some, or cutting off an entire niche that no longer delivers the results you need. And taking a large firm to a new stage might mean completely restructuring your leadership, moving power from partner committees to a managing partner with CEO-like authority.
Those are just a few examples; there are dozens more, including shifting from relying on referrals to building a professional business development function; breaking clients free of individual partners so they become clients of the whole firm; creating succession plans at the top, and eventually at all levels; building a culture that can be spread across multiple departments, offices and/or parts of the country; requiring strong cross-selling efforts; strategically expanding niches and specialty offerings; standardizing the firm’s client experience; and so on, and on, and on.
The important thing is to understand that adding clients and revenue will bring you to a point where you have to change, and it will happen sooner, rather than later. What changes you have to make will vary based on your size and the structure of your firm, but you will inevitably have to change to grow — and then you’ll likely have to change all over again.
