What Business Advisory isn't... quite
A young accountant with an MBA called me to say that his practice boss having asked him to introduce business advisory services keeps passing him Runagood® marketing emails claiming to do the same. He was understandably irritated, feeling he had already done that and didn’t need our help.
He explained that he had introduced the following new client services, trained everyone and results were looking promising:
Management accounting
Budgeting
Cashflow forecasting
Business planning
KPI reporting
Management review sessions
Since that is impressive as accountants certainly should offer these to its clients (but most don’t) it’s definitely the place to begin, so I complimented him on making a great start.
“Only a start?” he asked.
“Yes” I said. “What happens when these processes expose problems that the client needs solutions for, how do you advise them?
“What sort of problems?”
“Well, practical stuff like how to improve:
New customer acquisition
Customer retention
Operating efficiency
People productivity and commitment
Profits
Crisis management
Business / exit value
Growth
Lifestyle
Personal effectiveness
Diversification
Business risk management”
“Ah, that’s all covered” he said. “We subscribe to an app that issues fact sheets and templates on all those and more, which we download and pass to clients”
I then asked if clients actually use these to implement changes, whether the suggested actions are followed up at the regular client review meetings, and if performance changes are tracked.
“That’s down to the client” he said “but if I’m honest they aren’t good at implementation. We keep hearing that they didn’t find the time, so it never happened, and some have gone to consultants who charged a lot, whilst others had decided to live with the problem.”
“Is that a worry?” I asked.
“I suppose it is, but what else can we do? We can’t be experts on all that stuff, and they seem happy to pay for the new services we are introducing”
I asked if he understood the difference between an expert and a process consultant.
He narrowed his eyes, worried that his MBA training may have missed something. “Why not tell me your version” he parried.
“OK, so think about lawyers, doctors, accountants, engineers. They are all experts. Why?”
“Umm, I suppose they are specialists. They can do something you never will be able to do, so you give them the whole problem and they fix it all for you”
“Absolutely” I said. “Now think about teachers, counsellors, mentors, coaches. Are they experts?”
“Well,” I suppose they work with their students or clients to pass on knowledge, develop skills, find answers together?”
“Exactly” I said. “So, the expert consultant solves the whole thing personally, hands it back completed, the client learns nothing, but has got rid of a problem.
The process consultant, on the other hand, collaborates with the client and works with them to find and implement solutions to problems in ways that develop new skills in the client and keep the business moving up. S/he becomes a permanent part of the client’s life”
“I see” says my MBA “very interesting, but how does it work in practice?”
“OK” I respond, “What you need is an end-to-end process, a journey plan that starts with assessing where the business is now, where it should be, what the owner wants, what’s getting in the way, and a road map for shifting it, and the owner, upwards. Note that I used the word ‘process’.”
“Right then, where is there a process that does all that?”
“Well, that’s why your boss keeps sending you our emails. The Runagood® Business Process is what we sell. I think what he’s saying is that he wants your team to develop process skills that set up a continuation project with a client once the problems and ambitions are uncovered by what you are already doing”
“Hmmm. Fascinating. You’d better take me through this Runagood® Business Process then, I’ll have to seriously consider it!”
So, we book an hour on Zoom and I ask the boss to join, having established that he’s happy to share practice finances with his MBA.
We generate a Business Dashboard® Report, showing:
Losing £100K pa through underperformance in marketing
Overperforming by £100K pa in client retention – excessive dependency
Par for systems / tech efficiency
Underperforming in people productivity - £200K unused capacity
Underperforming for profits – £30K below benchmark
Value £300K instead of £1m
“I agree” says the boss. “we aren’t doing any marketing, our clients are slowly disappearing, we’ve spent a lot on systems, so good to know it was money well spent. My people are all working from home and have slowed down, profits are suffering, and I need this practice to sell for £1m in 5 years’ time.
That’s why I hired the MBA because 5 years from now, there won’t be much compliance work left for accountants to do”
“What’s next?” he asks
So, I generate a 5-year Forecast showing a green feasibility light for achieving £1m value.
I ask him which of the other 5 metrics he wants to work on first
“Hmm. It’s between marketing, profits and people, all of which need attention. Let’s start with marketing.
So, I open the Marketing Plan template and together we select the: Vision; Mission; Objectives.
“Ah” says the MBA “now what? This is exactly where we get to with clients, when we give them a marketing fact sheet telling them what to do”
“Indeed” I respond, and they don’t do it, do they!”
I open the 14 Marketing Methods, ask the boss where he wants to begin and he says, “with the Research Module, we need to stop guessing who our market is and what they want from us.”
So, I open it, we review its 17 individual action plans and he chooses to start by implementing the one that installs a proper CRM system.
“Fine” says the boss “we’ll do the programme, but what help do we get?”
“We provide you with a business coach who sets out each plan in detail – names – dates – budget and contacts you every week to keep it moving and unblock any holdups”
“OK, subject to fixing a fair price we’ll do it, won’t we Mr MBA?”
And the MBA to his credit says “Definitely. I see this will develop the practice with practical skills and solutions that we can then use with clients. And I really like ‘learning by doing’ I really don’t need any more academic stuff!”.
By Duncan Collins
Founder of Runagood.com Ltd