If Consulting Is In Your Future, Listen Up About Sales
Good news – accounting firms are reclaiming pre-pandemic opportunities. I don’t mean live people in real offices wearing pants and enjoying donuts on Friday, although good for you if that’s happening! I’m referring to a resumption of the continual shift toward consulting services. The shift that was interrupted by a global pandemic.
Across our industry, the arrival of COVID-19 in early 2020 shifted priorities to mostly compliance work, as firms helped businesses navigate PPP, changing tax deadlines, and other government stimulus and grant programs. The work provided a welcome revenue stream during a historic downturn. And it gave us an opportunity to ratchet up our consulting capabilities.
However, relatively few in the mid-market have fully embraced consulting, although most acknowledge it should be part of our future. With so much competition, we will continue to see lower margins in our core compliance services, with much of that work being addressed by technology solutions like AI and bots. As the future unfolds, CPAs will more than ever be in a position to perform the higher-level consulting work that only humans can do.
As firms assess the market and begin to craft their offerings, they will start to hire consulting and technology specialists. What they may be less aware of is the critical need to attract buyers using professional salespeople and a well-managed pipeline process.
The “S” Word
I can hear the visible intake of breath as managing partners contemplate the implications. What, salespeople? In our firm? It’s a valid concern, given that 80-90% of mid-market work has traditionally come from annuity and compliance business. Produce the deliverables, focus on client service and assume annual renewal. Compared to the corporate world, selling hasn’t required much heavy lifting. Referral sources and cultivating relationships was enough. The reality is, however, as the mix of non-annuity work tilts to annuity, there will be fewer auto-renewal projects, and a greater mix of one-time projects and retainer engagements. This will need a higher level of skills and more resources devoted to constantly keeping the pipeline filled.
Some firms have shied away from using sales professionals due to bad prior experiences. When approaches like hiring banking sales reps into firm sales roles didn’t work, they vowed never to try again. These attempts did not fail because of something inherently wrong with the concept. They failed because firms had no idea how to hire, whom to hire, and how to integrate them into the firm.
I’m often asked by managing partners why they would need sellers when they have a rainmaker model in place. It’s not only the increased mix of non-annuity services, but also because in most firms, traditional rainmakers – your most senior partners – are aging out, with fewer next-gen firm members experienced in strategic solution selling.
The Model Is Out There
Bringing in an outsider may feel disruptive or unnecessary. But as someone who has spent most of my career in sales and consulting, I can attest that when properly understood and structured, selling professional services is viable and profitable. For years, tech-based consulting businesses have made salespeople an integral part of their business model. It’s time public accounting firms took a page from their playbook.
Who should you hire? One of the ideal profiles is someone who has successfully sold tech consulting services in a strategic solutions (versus transactional) environment. Other tips:
- Salespeople are naturals at verbal communications. Don’t be fooled into thinking this indicates they can sell! There are high-quality, legal assessment instruments which evaluate a sales candidates’ attributes and likelihood of success.
- Expect to compensate your seller handsomely, even sometimes above the rate your top partners earn. These candidates are coming from a market that pays well for those who can drive large amounts of revenue.
- Bring your partner group up to speed on the salesperson’s role and get them comfortable with the idea of team selling. Too often salespeople find leads and are pushed out of the way throughout the rest of the sales process. This isn’t a good idea.
Sell and Prosper
Issues like remote versus onsite work are front and center for many managing partners as they resume post-COVID operations. But alongside these logistical issues, the best firms are focusing on building out a consulting business.
Sales professionals are essential to your successful evolution from a CPA firm that collects and handles historical information, to a consulting firm that applies data and expertise to solve business problems.
Copyright ® 2021 by Crosley + Company
Gale Crosley, CPA, consults with accounting firms on revenue growth. She was awarded the Advisory Board Hall of Fame. She has been selected one of the Most Recommended Consultants by INSIDE Public Accounting survey respondents for 15 years, and one of the Top 100 Most Influential People Accounting by Accounting Today for 14 years. Gale is an honors accounting graduate of the University of Akron, Ohio, winner of the Simonetti Distinguished Business Alumni Award, and is an editorial advisor for the Journal of Accountancy. She can be reached at email@example.com.