Restructuring Pay Can Help Retain Staff

Executive Summary

  • Restructuring Staff Pay Can Help Your Firm Retain Them
    • In a recent video on the BGW CPA, PLLC YouTube Channel, an expert on staff retention stated, “how you pay can be more impactful than what you pay.”
    • “People will fear losing something that they have far more than they appreciate an incentive to make them work harder.”
    • Firms can benefit from “creating something that people fear losing because it’s a much more powerful motivator.”
    • For example, a staff member’s fear of losing long-term compensation if they leave your firm could incentivize them to stay more than typical base and short-term bonus compensation structures.
  • Help Staff Shift from Compliance to Advisory Work – A recent article from Boomer Consulting shared some ways you can upskill your firm’s staff to support your firm if it is transitioning away from compliance work and toward advisory work:
    • A “skill development program,” which could cover:
      • Financial analysis,
      • Strategic planning, and
      • Client relationship management
    • A rotational program to broaden your staff’s experience
    • Mentorship and/or shadowing programs
    • On-the-job training
    • “A culture of continuous learning”
    • “Regular and constructive performance feedback”
  • Focus on the Benefits of Filtering Your Clients – Boomer Consulting recently suggested that when you think about parting ways with clients that are not a good fit for your firm, view it as a valuable step that will enable your firm to:
    • Free up the firm’s bandwidth to replace that revenue with clients that are a better fit,
    • Improve staff morale, which can improve staff retention, and
    • Improve the efficiency of your firm’s processes
  • Consider Embracing Apprenticeships – Rosenberg & Associates recently noted that Apprenticeship programs could help alleviate the staff shortage at CPA firms, including onboarding “people who have little or no schooling or experience in accounting,” and “they may or may not be college graduates.”
Secret-to-Staff-Retention
Secret-to-Staff-Retention

Accounting Today –  AI is why young staff need to be in the office: PwC’s U.K. boss 

  • The head of PwC U.K. believes junior staff should spend more time in the office for faster promotions as AI takes over routine tasks they used to “cut their teeth on.”

Accounting Today – Voices: Elevating Soft Skills in the Age of AI

  • The increasing prevalence of AI and automation increases the value of the five following soft skills for those working in the accounting profession:
    • “Analytical thinking;”
    • “Creative thinking;”
    • “Resilience, flexibility and agility;”
    • “Motivation and self-awareness;” and
    • “Curiosity and lifelong learning”

Accounting Today –  Voices Selling CFOs on AI

  • “89% of senior financial leaders expressed interest in adopting AI.”
  • “When asked about their concerns regarding AI, respondents identified a wide variety, including: lack of transparency into how AI arrives at decisions, perceived higher cost, data privacy and security risks, and lack of interpretability of AI recommendations.”
  • “Across all levels of finance teams, there is a strong preference for humans to remain involved in oversight and control when AI is deployed.”
  • While AI facilitates the work, “people still review outputs and have final sign-off before anything is executed.”

Accounting Today – Voices: Streamline the External Audit Process

  • “With the right preparation and mindset, organizations can transform an external audit from a daunting, drawn-out exercise into an opportunity for strategic insights.”
  • Companies can maximize efficiency and gain strategic insights from audits through
    • Early preparation,
    • Thorough risk and control assessments,
    • Data integrity verification,
    • Clarifying judgments and estimates, and
    • Formalizing action plans
  • These practices lead to faster, more cost-effective audits, improved auditor relationships, and better decision-making for the organization.

BGW CPA, PLLC YouTube Channel – Retaining Top Talent

A recent discussion some CPAs had with an expert on staff retention included the following actionable insights:

  • Provide “Loseable” Compensation: Longer-term compensation structures, such as long-term bonuses, can be far more effective in retaining staff than short-term rewards, such as base compensation or standard annual bonuses. A staff retention expert stated:
    • “How you pay can be far more impactful than what you pay.”
    • “People will fear losing something that they have far more than they appreciate an incentive to make them work harder.”
    • Firms can benefit from “creating something that people fear losing because it’s a much more powerful motivator.”
    • For example, a staff member’s fear of losing long-term compensation if they leave your firm could incentivize them to stay more than typical base and short-term bonus compensation structures.
  • Consider Over-Paying Staff: You could leverage a strategy Netflix implemented to overcome turnover problems by purposely overpaying staff.
    • For example, you could pay 10-30% above the 100th percentile pay for a role.
    • This results in employees being paid so much that they know they could not get an equivalent role elsewhere.
    • However, this may only be viable if your firm has a “high performers only” culture similar to that of Netflix, where people who do not perform extremely well are quickly shown the door.
  • Adjust Working Conditions to Meet Staff Preferences: Consider making your firm a more attractive place to work by allowing flexible work arrangements.

Boomer Consulting – Enhancing the Client Experience: A Strategic Approach 

  • “The focus has shifted from merely providing compliance and advisory services to creating a holistic and satisfying [customer experience (CX)] journey for clients.”
  • “CX refers to the sum of all interactions a client has with an accounting firm.”
  • Steps to enhancing CX include:
    • Identify your specific, ideal type of client
    • Form a CX team with people from across your firm
    • Address each client touchpoint
    • Take action to improve CX including
      • Identify areas of strength and weakness in your current CX
      • Clarifying the specific CX area you’ll enhance
      • Identify customers’ current experience with that area
      • Develop and implement revisions to improve that CX area
      • Build a mechanism to sustain your CX improvements

Boomer Consulting – Nurturing Career Paths from Compliance to Advisory 

  • Accounting firms can increase their competitiveness by facilitating their employees’ ability to shift from compliance work to advisory work and consulting services.
  • It can also increase your firm’s profitability through expanded client service offerings.
  • Some ways to help your firm’s staff make this shift include:
    • A “skill development program,” which could cover:
      • Financial analysis,
      • Strategic planning, and
      • Client relationship management
    • A rotational program to broaden your staff’s experience
    • Mentorship and/or shadowing programs
    • On-the-job training
    • “A culture of continuous learning”
    • “Regular and constructive performance feedback”

Boomer Consulting – Shifting Mindsets: From Client Filtering to Revenue Replacement 

  • Retaining all clients at any cost does not equate to “firm stability and success.”
  • When you think about parting ways with clients that are not a good fit for your firm, view it as a valuable step that will enable your firm to:
    • Free up the firm’s bandwidth to replace that revenue with clients that are a better fit,
    • Improve staff morale, which can improve staff retention, and
    • Improve the efficiency of your firm’s processes

Boomer Consulting – Supporting Employees Through Personal Challenges: A Guide for Leaders 

  • Staff at your firm may face personal challenges that can affect their work, such as financial difficulties, health issues, and family responsibilities.
  • Supporting staff through these challenges can help:
    • Increase struggling team members’ productivity
    • Increase employee loyalty and retention
    • Reduce burnout from other staff who would have otherwise needed to pick up extra work not completed by a struggling team member
  • Examples of support your firm could provide to struggling staff include:
    • Flexible work arrangements
    • Reassurance that their job is not on the line due to their current struggle
    • Employee benefits including
      • “Counseling services,”
      • “Health and wellness programs,” and
      • Financial planning assistance”

CPA Practice Advisor – Accountants Aren’t the Most Concerned About AI’s Impact—Except in One State

  • After attorneys and artists, accountants are the third most concerned professionals in America regarding how AI advancements could impact them.
  • Accountants can use AI for tasks such as generating financial reports and arranging expenses efficiently, but it can also lead to data breaches from cybercriminals.
  • This comes “on the heels of a Moss Adams study that revealed 69% of accountants believe artificial intelligence has a positive impact on the accounting profession”

CPA Practice Advisor – The Craziest Tech Gadgets at CES 2024

  • The Skyted Silent Communication Mask allows you to hold confidential calls in a public setting without allowing others around you to hear what you’re saying.

CPA Practice Advisor – Effective Marketing in Minutes: Essential Tips for the Time-Strapped CPA

  • Using unique and engaging content can help your firm stand out when you market to prospective clients.
  • Some other tips for effectively marketing your firm include:
    • Updating your Google Business Profile
    • Ask clients to give you five-star reviews on Google and testimonials, which you can put on your website
    • Design and schedule simple emails to be sent to prospective clients

CPA Practice Advisor – Here’s What Worries CEOs the Most About Generative AI, According to PwC

A recent PwC survey reveals that:

  • “64% of CEOs said they are most concerned about cybersecurity.”
  • “Over half of CEOs surveyed by PwC also agreed that generative AI will likely increase the spread of misinformation in their company.”

CPA Practice Advisor – New Tech and Innovation at CES 2024

  • If your firm serves clients who do not speak English, you could use the Timekettle X1 Interpreter Hub to have a real-time conversation where you each speak in your native tongue.
  • A more cost effective solution from the same company would be the Fluentalk paired with special earbuds from the same company.
  • The Tri-Screen 2 from a company called Xebec could help you and your staff be more productive when you’re on the go by enabling you to quickly and easily add two additional screens to your laptop.

Future Firm – How to Identify Your Firm’s Ideal Clients

  • Disengaging with clients who don’t meet your ideal criteria is crucial for the future success of your firm.
  • “Create a concise list of approximately 10 bullet points outlining the key characteristics of your ideal clients.”
  • “If you have existing clients, begin by analyzing those who value your work the most, pay well, appreciate your services, and whom you enjoy working with.”
  • “Understanding your ideal clients’ [challenges and] desired outcomes is as crucial as understanding who they are.”
  • “Having identified their specific challenges and desired outcomes, the next step is crafting a value proposition that aids them in overcoming challenges and reaching their goals.”

Going Concern – We Get to the Bottom of Why the 150 Hour Rule Doesn’t Require Specific Courses

  • There has been much discussion about how the elimination of the 150-hour rule to obtain a CPA license could help overcome the shortage of CPAs.
  • A document from 1988 provides clarity regarding why the 150-hour rule to obtain a CPA license does not specify which courses must be taken including the following:
    • “The profession requires that its entrants be men and women whose education has provided them with the foundations for lifelong learning, development, and growth.”
    • “No attempt is made here to completely delineate the content of a CPA’s general education because it does not always relate directly to the demands of professional practice.”

Rosenberg & Associates – The CPA Profession Needs to Embrace Apprenticeships

  • Apprenticeship programs could help alleviate the staff shortage at CPA firms, including onboarding “people who have little or no schooling or experience in accounting,” and “they may or may not be college graduates.”
  • On-the-job training can be more crucial to the professional development of your firm’s staff than a formal education in accounting.
  • “The apprentice strategy should be used as a nice supplement to our efforts to hire and retain accounting majors.”

Leave a Comment