Succession planning

By The Team

BankWest estimates that almost 52% of accounting partners will retire in the next five years. However, in 2019 only 25.2% of accounting firms had a documented succession plan. For practitioners who plan to sell to an existing partner, or elevate a successor internally, there are many ways to prepare their organisation in advance.

Step 1: Create a modern little black book.

It is a truth universally acknowledged that accounting firms are only as strong as their client relationships. However, the relationships partners have with clients are often personal and steeped in history. Additionally, many practitioners have learned to keep their client list, and client information to themselves. As a result, when partners retire often essential information is not passed onto their successors.  

You don’t have to share your client list with your team – yet. Instead, keep track of every interaction, every essential piece of client information, so that when you’re ready to leave, it is easy to pass on the information.

What is the best approach? Well, there is a limit to how much information anyone should put in a spreadsheet, or a word document. Tight privacy controls are essential for protecting your organisation’s security now and into the future.

Instead, a good approach is to invest in a customer relationship management system – essentially, a database where you can keep track of all your valuable client information. A CRM is a platform that manages your firms’ relationships with your clients and prospects. CRMs have historically had a reputation as clunky to use and expensive, but new cutting-edge platforms on the market are changing all this, and the software is simple and effective.  

Additionally, as many more companies seek to migrate to cloud-based software – transitioning your team onto the cloud now will ensure that your client information is not lost when your team inevitably makes the transition in a few years.

What information should you record in your CRM:

• Future aspirations. ‘Where does your client want to be in 5 years?’
• Past business experience that may have shaped their attitude to business (for example: an unsuccessful venture? A major win?).
• What are their interests?
• What approaches work best when communicating with them? Straight to the point, or a quick chat first?
• Relevant client details and financials

Step 2. Introductions and gradual transfers

It’s essential that your most important clients meet with other members of your company – and get to know them. Do this gradually at first, using company events and social occasions to stage initial introductions. This is particularly important if you don’t want to alert clients to your upcoming retirement.

Then, look out for opportunities to engage your employees in a client meeting. Does your successor have a particular area of specialisation that might be relevant to your client? Can you leverage that skill in a one-on-one client meeting?

Give your team a chance to learn from you

• Schedule a pre-game meeting prior with your successor prior to meeting with your client. This is where you can signal what aspect of your approach you want them to learn. For example — ‘Look out for how I bring up sensitive matters or, notice how I ask about his children by name.’
• Post-game meeting: Ask your successor what they learned, give them an occasion to ask you questions.  
• What are their interests?
• Following the meeting write notes and tips in your online Customer Relationship Management system.  

Step 3: Educate widely and informally

When you’re ready to bring the wider team into the learning process – log how you engage with clients by posting about your meetings, and learnings on an online system. This way, all your advice is stored for your team in a place that is easy to access. It may also encourage other partners to do the same.  

Accounting firms must create these opportunities for mentoring and learning and by posting about your meetings you can set this as an example. Many new graduates are not taught how to foster relationships, think on their feet, or find new ways to connect with their clients.

Deepen the attitude of growth and learning, so when you leave the culture is ready to adapt and grow. This is particularly relevant if you have a hybrid workforce.  

Step 4: Give over some credit

We all want to be superheroes. But if you’re the only person your client trusts, your client will only feel loyalty to you. So, when you leave, your client’s reason to stay with your organisation – vanishes.  

Leverage the skills of your team – and look for new areas to specialise. Is someone an expert in blockchain? Property? Show how your successor and your team can help to take your client’s business to the next level. Where appropriate, invite team members to speak with your clients about areas of expertise.

You can also do this by:

1. Sending newsletters celebrating members of your team.

2. Webinars where members of your team provide expert advice

Keep track of who engages with these communications by reviewing click-rates, and attendance. This can help to foster a sense of the entire organisations’ skillset – and celebrating your team can also help to strengthen company culture and increase company retention.

Step 5. Put your name to it

Show your clients how much you trust your team. Emphasise that you are only choosing to retire now, because you know your team is more than ready to take your business to the next level.