Summer’s over, October’s here, and things are changing. But that’s the state of our world today, isn’t it? And not just when it comes to the weather.

Change is the new normal, and that can be an uncomfortable thing, especially for  CPAs. But for those who are ready to embrace it — to adapt a more nimble and flexible mindset — there are a lot of opportunities just waiting to be taken advantage of.

The question is, how do we do that? How do we start embracing flexibility and fluidity as competitive advantages? How do we start thinking about transforming our very business models so that we’ll remain relevant in a changing and complex world? Those things aren’t baked into our DNA, are they?

But here to help us figure it all out is Will Hill, Tax Professionals Advisory product manager for Thomson Reuters. He’s been included on CPA Practice Advisor’s “40 Under 40” list twice and he’s an innovator with TR’s Practice Forward service offering, which is focused on helping firms make the transition to having client relationships that are centered on Advisory Services.

In this conversation, we cover:

• How a tradition-based profession like accounting and finance gets started down the path toward business model transformation.
• Why these changes may make you feel uncomfortable — and why they’re necessary.
• The logical first steps toward implementing Client Advisory Services.

Listen to our conversation here.

In the CPA firm world, talk of business model transformation and Client Advisory Services (CAS) often go hand in hand. A lot of firms are starting to realize that, in order to successfully offer Client Advisory Services, they need to reform their entire business model. In many cases, those models don’t easily accommodate these new, higher-value services. So what kinds of changes are required to do CAS right?

A recent article in Accounting Today, “Inside CAS: Promises and Pitfalls,” offers some ideas. The article features Accounting Today editor Dan Hood interviewing some cutting-edge practitioners, firm leaders, and industry experts to shed some light on the opportunities and potential landmines that Client Advisory Services offer the profession.

One particular passage caught my eye. Hood asked the panelists, “What pitfalls should firms be aware of when they’re launching or transitioning to a CAS practice?” Here’s what they said:

• Hitendra Patil, director of customer success at AccountantsWorld and a previous guest on this podcast, said one such pitfall is “expecting CAS to be an add-on to existing ways of working. ... CAS can fundamentally change some of your current internal processes. It means your people have to learn some new ways and unlearn something that they did for years. It is an addition and a modification, but also a deletion of some of your processes. Your people will also need to learn the new components that you may add to your technology stack.”
• Kenji Kuramoto, CEO and founder of Acuity: “The biggest mistake I see firms make when starting a CAS practice is not understanding that the cadence of CAS services is entirely different than the traditional service lines within CPA firms. CAS work is often performed on a weekly, if not daily, basis. I’ve yet to see a firm successfully launch a CAS practice by staffing it with tax staff who are out of their traditional busy season times. Using this approach, you may gain a few clients in the summer but you’ll likely lose them and burn bridges with clients come tax busy season when the same staff have to up their utilization for tax work. Using a dedicated team for CAS is essential.”
• Liz Mason, CEO of High Rock Accounting: “Providing CAS for hourly rates is always a bad idea. Try to price your engagements based on the percentage of a full-time equivalent’s salary. It gives you a good base for clients to respect the value of what you are doing for them and respect you more for it.”
• Michael Cerami, vice president of marketing and alliances at CPA.com: “Firms need to assess workflows and processes that optimize the technology. Sometimes this means turning your business model on its head, and practitioners don’t like to take a departure from what’s familiar to them. So the change management component can be the real challenge. Objectively assess your firm’s strengths and weaknesses first, and then develop a solid strategy for the type of CAS offering you want to put in place. We’ve developed a lot of resources to help firms make this transition, because it’s critical.”

So in a world of exponential change, making just one change to your service offerings — offering Client Advisory Services, for instance — can mean wholesale changes for the entire firm and its business model. And that’s hard to come to grips with.

Luckily, we have Will Hill with us this week to help us get comfortable with those changes.

Who do you think we should be talking to? If you have some ideas about topics or guests for upcoming shows, let me know by dropping me a line at Bill@BLIonline.org.

Or just say hi! I’d love to hear from you.

Resources:

• Learn more at ThomsonReuters.com/tax-accounting
.
• Follow Will on LinkedIn.
• Read Will’s blog post, “Don’t Underestimate the Value of CPA Advisory Services.”
• Read: “Inside CAS: Promises and Pitfalls.”
• Check out MACPA.org/future-learning.