Strategic planning, the process to create, and the value it delivers, is something that is so misunderstood in most small and midsized CPA firms. There have been tons of books and articles published about the strategic planning process. Developing strategies is probably the most prevalent topic that accounting firm partner retreats focus on. There are numerous processes that firms have used in the effort to create and execute a strong and effective strategic plan that would propel the firm. This perspective is not about suggesting a new or the best process for a firm to follow but will highlight the five major missteps most firms and most organizations make when building their strategic plan as part of a partner retreat or any other forum for that matter.
When most retreats focus on strategy, they generally approach it through various methodologies built around some form of a SWOT analysis. Strategies are then built based on the challenges the firm is facing or the opportunities that the participants envision with a belief that building strategies through this process will result in a strong, effective strategic plan.
What’s wrong with that? Basically, the above process is built from the current to the future versus the future to the present. It is critical that as part of the planning process there is a strong and objective understanding of where the firm is today, what are the challenges it is facing, and the opportunities that lie ahead. However, starting the planning process from the viewpoint of the firm today will almost always result in strategies that are mostly tactical strategies that look out a year or two versus strategies that are long-term, directional strategies that look out four to five years. In addition, the strategies, even if tactical will be incremental versus game-changing. The five major missteps are reflected in the graphic below:
Let’s briefly dive into each step:
The goal of a strategic plan is to create a roadmap that can lead the firm from where it is today to its vision of what it aspires to be. It is not about creating strategies that beat the competition or creating a firm that implements someone else’s best practices. The firm’s strategic plan should focus on creating a firm that is clearly different in the eyes of clients (current and future), a firm that is based on providing value to each client to help each client become more successful. The strategic plan is not about nibbling around the edges but rather a plan that moves the firm from wherever it is today to a firm that clients love, and that talent is drawn to – an exceptional standout firm.
In Our Opinion, every firm should take the time and put in the effort to create a long-term strategic plan mindful of the above four missteps. So many firms don’t have a strategic plan that is truly impactful if they have one at all. Far too many accounting firms see little value in a long-term strategy and find false comfort in rationalizing the lack of a strategic plan with reasons such as (1) things change too fast; (2) next year is all we can really control; or (3) the partners don’t need a plan, and on and on. There is an old saying that states if you don’t have a destination, any road will get you there. If the firm does not have a future vision coupled with core values and a strategic plan to achieve that future vision, then the firm will remain stuck where it has been, achieving some incremental growth but never become a firm that is truly exceptional.
It takes courage to move from the comfort of the past to creating a vision and strategic plan that requires you to think four or five years down the road with all of its unknowns. It takes courage as firm leadership to chart a course where there are so many variables. The point leads us to a 5th major misstep –thinking that the strategic plan once developed is a static document. It isn’t. The strategic plan should be a rolling plan where every year the plan is updated for the year that past, lessons learned, and a year added to the plan so that it is always a living five-year roadmap.
There are some great quotes about the need to revise strategy based on experience:
The challenge is to have the courage to develop a strategic plan that creates the roadmap to exceptionalism and don’t settle for incrementalism. Finally, be mindful of the missteps so many firms make in their partner retreats when focused on developing their strategic plan. Done correctly, the strategic plan will be the roadmap to a future of exceptionalism and move your firm out of the shackles of the past.
Written by Tony Zecca (CPA and retired CohnReznick partner and National Director of the Advisory Group), an ESPOSITO CEO2CEO consultant who is brought into client assignments when needed.
ESPOSITO CEO2CEO, LLC — a boutique advisory firm consulting to leading CPA and other professional services firms on strategy, succession planning, and mergers, acquisitions, and integration is actively led by Dom Esposito, CPA. Dom, voted as one of the most influential people in the profession for two consecutive years by Accounting Today, authored a book, published by www.CPATrendlines.com., entitled “8 Steps to Great” which is a primer for CEOs, managing partners, and other senior partners. In Our Opinion, is a continuing series of perspectives for leading CPA firms where Dom and his colleagues share insights, experiences, and wisdom with firm leaders who want to “run with the big dogs” and develop their firms into sustainable brands. Dom welcomes questions and can be contacted at either email@example.com or 203.292.3277.
This has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and ESPOSITO CEO2CEO, LLC, its employees, and its independent contractors accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.