How to get started with business advisory
I somehow can’t get started on business advisory
So say accountants who are trying to break into the business advisory market. “I think I know how to do consultancy but how do I start? My clients trust me for compliance and tax work and do what I say, or I do it for them. But when it comes to advising on their marketing, customer service, systems, people problems I usually know the answer but worry that they will not take me seriously. And if they do, what about if I tell them to do something, that doesn’t work?”
Expert consultant
Typically, lawyers, doctors, dentists, engineers, compliance accountants, financiers. They all have specialised knowledge and skills which we are bound to trust, and we pay them in the knowledge that they stand a much better chance of saving us than if we try to solve our own problem. So, there is inbuilt consumer acceptance.
And these expert consultants don’t need to market themselves much because there is a steady demand for what they do, the business coming in by referral, Google searches, networking.
Therefore, they are culturally reactive.
Process consultant
Typically, a mentor, coach, advisor, trainer. They have generalised knowledge and skills in common with business owners ie how to run a business and fix problems with marketing, operations, systems, people, profits, cashflow. Some specialise in one of these topics with deeper than normal knowledge or at least the appearance of it.
But they all have in common that their services are optional and for that reason they have to market themselves which means reaching out to businesses in the hope of finding owners with a currently insoluble problem or ambition. And when they do find one, they apply a process of discovery, assessment, identify potential, action planning and implementation to move the business from its today position to the desired position.
They are culturally proactive. They have to be.
What does this mean for accountants diversifying into business advisory?
It’s a challenge of mindset. It means starting to think proactively which after a lifetime of reactivity puts an accountant into an understandable position of discomfort and self-doubt. This is because their cultural conditioning is about being approached, listening to the problem or need, then saying, “leave it to me”.
But the business need is to say “let me introduce myself, how’s it going, what difficulties are you facing? Let’s see if I can help”. Driving the expectation that you will now be able to say “right, do this / that / other” and not render a bill (by the way!) This method is commonly used by consultants and only works through lucky strikes or with an existing client who trusts you.
The answer lies in process
Accountants are good at processes and good business consultancy is also about good process. It’s not about the brash introduction described above, so beloved to many consultants and so off-putting to most business owners.
The way to start is with existing clients who are a known quantity with established relationships and trust and to subtly add financial management services such as forecasting and budgeting. You have ready access to their historic performance through the online bookkeeping systems and by using the add-ons can produce outlines for them as a present.
Don’t ask just quietly do it for free as ‘part of the service’ to get them thinking. Book quarterly review meetings to follow up and they will start to appreciate it and enter business discussions, opening the door to offering a chargeable management accounting service. This will be a logical addition to the free budgeting and forecasting and you can now charge for all 3 as a packaged service.
From there, you will publish regular reports showing their actual v budget performance which engages you in even deeper discussions, building up your knowledge, experience and confidence to engage in broader business discussions.
The final act is to attend client management review meetings at which financial performance is discussed and where you can help to identify the influence of pre-financial factors like marketing, product quality, customer service, people productivity.
You are not advising but collaborating with your client to explore everything together in a search for progress through intelligent and informed solutions.
And remember the power you bring to this:
You already run a business so are experienced in dealing with multiple problems and finding solutions
Your experience of working with many businesses learning from their solutions for the common issues of:
Finding new customers
Retaining customers
Systems efficiency
People commitment
Productivity
Profits
Cash flow
Funding
So, you’ve now successfully upgraded into ‘Trusted Financial Advisor’
From here, the next step is into ‘Trusted Business Advisor’
…where you are able to confidently assist your clients with any problem and any ambition. Not by telling them what to do buy by working with them to find solutions together.
It’s all about pathways where you learn as you go, slowly lifting your credibility at a pace that works for you and frees from the pain of having to hard sell or make unrealistic claims.
Runagood® has your roadmap, technology and support starting here.