Making Time: Selling a Part of Your Practice
In this episode of A Look Into the Future, Paul Latham from Hayden Rock Solutions addresses one of the biggest challenges accountants face: finding enough time. As demands grow and IRS deadlines loom, many accountants feel there’s simply not enough time to add proactive services. Paul shares strategies for overcoming this challenge, including selling off certain client segments to create space for growth.
Why Time Management is Essential for Accountants
Accountants face constant time pressure, especially around tax season. Paul explains that to shift from a compliance-focused practice to one that offers forward-looking advisory services, accountants need to free up time and avoid the “insanity” of doing the same things while expecting different results. This requires strategic changes in managing client relationships and workflows.
Four Strategies to Free Up Time
Paul shares four primary strategies that can help accountants make time for proactive services:
1. Delegate to Junior Team Members
For larger firms, delegation can be an effective strategy. Many partners hold on to all client relationships, but by segmenting clients into A, B, C, and D categories, partners can focus on A and B clients who are interested in proactive services, while assigning C and D clients to junior team members. This approach also provides career growth opportunities for less experienced staff.
2. Sell Off Low-Priority Clients
At the other end of the spectrum, some accountants choose to sell off C and D clients altogether. Paul advocates for this approach as a decisive, commitment-driven strategy to create more time for high-value clients. Selling these client segments not only frees up time but can also generate immediate revenue.
3. Outsource Time-Intensive Work
Outsourcing repetitive tasks, such as data entry or basic 1040 tax preparation, can help firms maintain productivity while focusing their in-house efforts on advisory services. By leveraging outsourcing for labor-intensive work, firms can reallocate time toward client-facing, strategic tasks.
4. Implement a Transition Plan
Paul shares his experience with a transition plan that gradually reshapes the client base. For every new A client added, the firm would “kick out” two lower-priority clients, and for every B client added, one C or D client would be removed. This methodical approach took several years but allowed his firm to transform its client base without immediate disruptions.
Choosing the Right Strategy for Your Firm
Paul acknowledges that every firm is different, and the best approach depends on the specific needs and resources available. He typically recommends firms start with delegation or outsourcing as a trial period before committing to selling off clients. This allows firms to become comfortable with the process, evaluate its effectiveness, and eventually scale it up.
Building a Vision, Plan, and Desire
Paul emphasizes the importance of having a clear vision for the firm, a practical plan to achieve it, and a strong desire to follow through. These elements create a foundation for long-term success and help firms stay committed to the transition, even if the process is challenging.
The Role of Junior Staff in Transitioning Clients
Delegation and transitioning offer junior staff members an opportunity to manage client relationships and gain hands-on experience. By assigning C and D clients to junior staff, firms can evaluate their potential for future advancement while allowing them to develop client-facing skills in a lower-stakes environment.
Conclusion: Creating Time for Proactive Growth
Finding time is essential for firms looking to evolve into proactive advisory services. By implementing client segmentation, delegation, outsourcing, or a transition plan, firms can build a client base aligned with their vision and free up resources for forward-looking services. With a clear plan and commitment, accountants can reshape their practices for long-term growth.
