Emerging 2021 Trends – Leadership

In my last issue we explored the two 2021 emerging trends that are currently resonating around the profession. In the first we explored the ongoing importance of developing the technology in the accountancy business while the second looked at the role of advisory services in the service portfolio.

In this issue we will explore the third of our six emerging trends: Improved leadership skills

Improved Leadership Skills

When I first started in accountancy the local bookstore had only one bookshelf dedicated to books on management. On one occasion I visited the famous London booked store founded by William and Gilbert Foyle in 1903 – ‘Foyles,’ yet even their shelves were fairly desolate when it came to books on either leadership or management. Then along came Peter Drucker, sometimes referred to as the ‘father of management’. Drucker authored 39 books on management and leadership that have been translated into 36 languages. His books include wisdom that is now firmly established in management law today. Some quotes you might recognise include, “Doing the right thing… is more important than doing the thing right”; “Leadership is lifting a person’s vision to higher sights, the raising of a person’s performance to a higher standard, the building of a personality beyond its normal limitations”; and finally, “The entrepreneur always searches for change, responds to it, and exploits it as an opportunity. Today bookstore shelves overflow with books on leadership and management. 

Scope of our professional training

As a budding accountant I studied major technical disciplines relating to accounting, auditing and taxation, while studying minor disciplines such as mercantile law, statistics, data analysis and other career related subjects. Interestingly there was nothing in the curriculum on leading or management. The reason for this silence is clear for Institutes have a clear mandate to deliver into the marketplace those who are able to fulfil necessary statutory duties to serve government and its people.

2021 insights

So, I am going to take a leap over all those giants of management and leadership wisdom and highlight a few insights that appear relevant to the profession as we journey through 2021 and, hopefully, toward a safer and more normal (Yes, I understand that many of us do not know yet what that looks like) tomorrow.

In one sense, the pandemic has not changed the basics of life in an accountancy business – delivering quality work and doing all that is necessary to ensure client’s tax liabilities are as low as possible while being mindful of [possibly extended] filing deadlines. However, the pandemic has added new angles and demands of responsibility including responding to client needs to apply for government grants, state loans, furlough payments and so forth. That coupled with the challenges of managing a workforce that is either working remotely or having to move around the office maintaining social distancing rules.

Leadership is a massively essential subset of management. So, setting aside so many components of leadership let us look at just 5 elements that I think are particularly relevant today.

1 Caring for staff, including the owner team. I heard recently of one staff member who tragically felt led to take their own life. Others have told me how their marriages have fallen apart. Is the pandemic to blame? I don’t know but maybe it has been a contributory factor – life always is, isn’t it? So, managers and firm owners please allow me to remind you of three very simple and long-standing essential habits [of great leaders].

  1. MBWA – Management by walking about. (As taught by consultant and author Tom Peters). At some point in the day, maybe first thing, walk around the office, smile and greet those with whom you work. This sets an example for others to follow.
  2. Do you know three personal things about your team? Let them know you are interested in them as people. Find out a little about their interests, family, holiday or time out plans.
  3. Finally, always be in the habit of finding people doing work well. Praise people as opposed to criticising them. Do all you can, when you can to be an encourager. Say and do things that build people up rather than tear them down. A harsh word can be destructive and demotivating. Do you have leadership skills? Of course, you do but we are all a work in the progress and can improve – I know that is still true for me.

2 Lead by example. You are being observed by those around you and need to set a good example. What you do, or say, others will follow. Last week I met with a new client who has invited me to work with his key manager team – who I know will also be reading this blog! The firm owner works hard – very hard and his ethos is evident firm wide. The care the team have for him is almost palpable. I have another client, John, who is a partner in a 50+ partner firm. He also has three managers who he mentors, encourages and provides positive feedback to at regular intervals. Their performance is above firm average, they all have high levels of motivation and all manage their teams in the way they themselves are managed. A win-win situation.

3 Delegate. If I were to make one sweeping statement about those I have worked with over these past 25+ years it is that delegation is a massively underutilised management strategy. Here are a few words of wisdom from others:

“When you delegate work to a member of the team, your job is to clearly frame success and describe the objectives.”

Steven Sinofsky, former Microsoft executive

“If you want to do a few small things right, do them yourself. If you want to do great things and make a big impact, learn to delegate.”

John C. Maxwell, American author

“The only reason you struggle to delegate is because you are not clear of how to achieve the results.”

Chinmai Swamy, author, Authority Launchpad

What work could you delegate?

I have on many occasions asked seminar attendees, “How much of your work could you delegate?” The answer based on a show of hands is invariably between 25-40%. So why do we refrain from delegation? If this is you, you will have your own thoughts, others have told me they do not delegate because:

“We do not trust our staff?”

“I can do the work quicker myself”

“If I delegate 25% of my work I am not sure what I will do to make up my billable time”

My conclusion?

Maybe a lack of commitment to spending more time one on one with clients working on helping them in the here and now of their business. O, I know there are much better answers than this, but my encouragement is for you to identify the reason you don’t delegate and remedy the situation. It might take you to actively set aside the emotion of fear (False Evidence Appearing Real).

A PS to the above examples

Please allow me to give you the flip side of one of my clients (sole practitioner – 25 staff). I have a client who engaged me five years ago. One of her key objectives was to free herself up. While she has achieved a number of her key objectives (growth, marketing, hiring better staff, increasing profitability) she is not even as free as when we first met five years ago. In fact, in the past 365 days, she has worked for 360! The reason? She cannot let go of checking everything done by staff. I share this sad situation to demonstrate that my work does not always achieve the desired results. 

4 Leadership promoting growth. Moving on from what you might perceive to be ‘soft’ but highly impactful skills we now look at a few aspects of 2021 accounting firm leadership. I have been amazed at the number of firms reporting that 2020 was a good year. Here is just one example received in the last two days from Mark, a UK client who says, “…On business, we have had our best year ever! We continue to develop new services, talent and contacts. I have had a few interesting conversations on this so will drop you a separate line shortly on a few marketplace and management issues.”

Accountancy business owners should be looking carefully at how to grow the firm for these are unquestionably days of opportunity for increasing your marketplace footprint. How to improve margin. How to increase the top line. 

My empirical observation regarding the accountancy profession is that there is no longer any ‘norm’. Some firms have increased profitability, others have not. Some have employed more staff – others have made staff redundant. Some have seen billable time increase, others have not. Some have serious lock up issues, others have seen lock up reduce. Performances can often be seen in opposites. The key challenge for firm leaders is to harness all the firm’s talent to drive the numbers in the right direction. 

5 Driving growth in 2021. It is essential to ensure that your marketing planning is (1) up to date, (2) being implemented and (3) delivering required results. If not, then what needs to change to make marketing happen?

  1. What are your target markets? Who are your prospects within those markets? What is your niche expertise? What are the best strategies for reaching those markets? Can you invite prospects to an online event? Can you arrange an online meeting? Can you send them something that is relevant and industry specific?
  2. Develop a niche strategy.
  3. Make sure you engage with your front line teams. Set targets. Hold them accountable. Have them create a ‘one page plan.’ Encourage them. Hold them accountable. Incentivise them.
  4. Understand why you lost clients in the last year? Lessons?
  5. In the area of new client growth some firms are reporting that their new business pipelines are not as robust as in previous years. This is less likely to be the case where there is a marketing department. This is more likely to be the case where partners are the primary driver of the marketing. 

Looking ahead

  1. Those firms who do not have a [full time] marketing team will likely inaugurate a team
  2. Firms will harness the power of technology including the Cloud to develop a national, or maybe an international, footprint
  3. As compliance becomes increasingly digitalised firms will look at appointing specialist heads of the various non-compliance service lines
  4. An increasing number of firms will hire sales people.  

Up next – In my next blog I will look at our fourth 2021 Emerging Trend.