Efficiency, innovation, and success: Mastering strategic planning

A solid strategic plan is the key to managing shifting expectations in the public accounting industry

Running a public accounting firm is more complex than ever. Constantly evolving legislation and standards impact your organization and your clients; staff priorities have shifted from building an all-consuming career to maintaining a strong work-life balance, larger salary, and meaningful work.

In small and midsize firms in particular, younger accountants joining the business — and there are fewer of them than before — aren’t as willing to invest long hours to work their way up the ladder into the Big Boss’ chair. They’re willing to leave a smaller firm to secure those things important to them, which can create an uncertain succession when it’s time for firm leaders to retire or move on.

At the same time, client demands are changing. They expect instantaneous, digital conveniences and more consultive services. All these factors mean securing your firm’s future is becoming increasingly difficult. In answer, firms need to create an actionable strategic plan for their firm’s longevity.

A well-thought-out strategy will meet these changes head-on by addressing employee priorities, client demands, and the firm’s long-term needs. It will confront inefficiencies that impact client service, employee retention, and staff shortages. It will shape the direction of your firm, enhance communication, foster creativity, and drive action.

The strategic planning process will take time and pull you away from pressing day-to-day activities. But, not having a well-thought-out strategic plan leaves you vulnerable to being passed by your competition. You will risk losing top talent to bigger firms with deeper pockets and clients to firms that offer conveniences you don’t, such as self-service options, real-time data sharing, and ease of secure document transfer.

In other words, the cost of inaction in strategic planning is incalculable.

This white paper examines the key ingredients of an effective strategic plan and provides actionable steps to help draft your plan.

The benefits of strategic planning:

  • Establishes firm direction to drive growth and ensure the continued future of the firm.
  • Puts everybody on the same page through improved communication and collaboration.
  • Promotes creativity and innovation to meet clearly defined, ambitious goals.
  • Focuses the firm on action and implementation to meet firm goals and to provide exceptional client service.
  • Creates a shared vision for growth and prosperity that everybody can buy into.

Critical components of strategic planning

Gaining the benefits from a strategic plan starts by gathering internal historical data and analyzing marketplace conditions. For example, look at budget actuals for every audit performed. That will show how many resources you pour into each audit, determining how many audits you can take on — or how many new hires you need to reach your goals.

Take a clear-eyed, holistic view of your practice:

  • Does your pricing strategy match the value your customers get from your services?
  • What current and proposed regulations will impact your firm and your clients’ business?
  • How stable is your firm’s staffing? How’s morale among your staff? Are they happy and satisfied, or feeling overworked and underappreciated?

Determine if there are areas your firm can specialize in to stand apart from the competition, such as focusing on audits or an industry in which you have strong expertise. Consider what types of services are needed in the marketplace and what services your clients are asking for.

This deep analysis will allow you to define where you come from and where you need to go. It’ll also help you understand shifting client expectations and the changing marketplace. Then, you can define short- and long-term goals to keep up with — or ahead of — those changes.

Increasing profitability will always be at the top of any goals list. But how will you increase profitability? That’s where specialization and increased efficiencies can help.

In the long term, consider goals that drive firm growth, including staff retention. Losing employees doesn’t take much, and those defections can impact your firm’s ability to serve clients and grow. Creating efficiencies can help you retain staff because they’ll be able to do fewer data-entry tasks and more consultive work — and obtain a sought-after work-life balance.

Set objectives to get you to your goals and performance metrics that allow you to measure progress. These objectives will help you find solutions to your roadblocks — such as the right technologies to create efficiencies in your auditing process. Metrics will help you identify opportunities for improvement.

How do you bring all these components together to build your strategic plan? By following these steps.

Conduct a SWOT analysis

To understand what your firm does well now and how to improve for the future, you can undergo an assessment of strengths, weaknesses, opportunities, and threats (SWOT).

To uncover your strengths, review the types of services and audits you’ve done over the last several years. If you’re getting a lot of a specific kind of business, you’re probably doing it well. If clients are returning, you’re serving them well. You’ll see where your growth opportunities exist by uncovering what you do well and what services the market needs.

On the other hand, there are likely types of projects you’ve taken on that haven’t worked out too well. Now’s the time to get honest. There’s no reason to waste resources pursuing projects that aren’t your strength and will drain resources that could go to projects that will advance your firm.

For some firms, a weakness is pursuing projects that require more expense than they get back in revenue. Another weakness is being unable to pay staff what the bigger firms can.

Then there are the threats that you need to see coming. These include competition, pending regulations that limit capacity in this industry, and larger firms poaching your talent. Another threat is growing randomly for the sake of growth. That can lead to investing in resources that don’t bring an equal return. On the other hand, a threat could be refusing to invest because you don’t see the ROI for technology, which can have a long-term impact on your firm and its growth.

Engage stakeholders in the planning process

Each stakeholder should have input, but as the firm grows, this becomes more complex as competing priorities creep in. Ensure all the right voices are heard, but ultimately, ensure the facts and data support decisions.

Create an actionable strategic plan

Take that input and create an actionable plan that outlines steps for reaching your goals.

Implement and monitor progress

Firms should be monitoring profitability every month. Since all goals are in service to this objective, that will give you a good feel for your progress toward your strategic goals. But give it a defined period before reviewing your progress and making any course corrections. According to Bill D. Carrera, CPA, one year is a good span.

Addressing areas of concern

As you go through the strategic planning process, you’ll want to address several areas of concern. Here’s how to plan to overcome them.


Efficiency drives profitability and growth. The fewer resources you extend on a project, the greater your return on investment. Efficiencies also free up accountants for those more meaningful tasks.

In the 2023 state of the tax professionals report, efficiency is listed as the top priority for tax professionals, with 36% of respondents saying that improving efficiency is a top strategic priority, a 15% jump from 2022. Midsize firms, in particular, plan to focus on efficiency in 2023.

Improving efficiencies starts by identifying ineffective and time-consuming processes and workflows. For example, auditing processes are rife with slow manual techniques in the reporting process and file sharing.

Technology and best practices can address many of these inefficiencies. The proper software can streamline workflows and automate the tedious, ineffective steps from the beginning of the audit through the final report. Many of the respondents from the report mentioned earlier plan to use technology and automation to streamline operations and achieve greater efficiency.

An accelerating trend:

  • Thirty-three percent of firms automate up to 25% of their tax workflows
  • About one-quarter automate between 26% and 50% of their tax workflows
  • Just 29% automate more than half of all of their workflows

You can learn best practices by reading trade publications and talking with other members of trade associations. There, you can get advice — and inspiration — for improving workflows. Some best practices include better training, education of the workforce, and increased standardization. A person must be specifically designated to drive firm efficiency; without such leadership, efficiency initiatives will not likely go very far.

The growth mode

Everything you do is in service of firm growth. However, “Many firms think that just by buying other firms, they get bigger, and that adds stability. But you’ve got to focus on building a solid foundation before you think about growth,” Carrera says. “Growth for the sake of growth is not the way to go.”

Your internal analysis will help gauge whether you’re ready for growth. When you are, use your SWOT analysis to match those opportunities with your firm’s internal expertise and then use technology and automation to free your experts to work with new clients and “big-fish” projects.

Expanded service offerings can also power growth. More than 93% of respondents in the 2023 State of Tax Professionals Report said their clients seek more business advice. But half of midsize firms don’t offer the business services clients want. Only 50% provide financial planning, and even fewer (37%) said they provide decision-making support or business consulting services.

The most common business services clients are seeking from their accounting firms:

  • Tax strategy
  • Business consulting 
  • Financial planning
  • Decision-making support
  • Help with HR or organizational issues

Expanding services also means reevaluating how you price services; the by-the-hour approach may not match the value clients get from business advisory services. Because of that, more than half of the respondents in the tax professionals report already offer the most popular forms of pricing:

  • Flat fee 
  • Time based 
  • Hourly
  • Project based

But there are even more options available, although far less common:

  • Retainer pricing
  • Market-value pricing
  • Competition-based pricing
  • Cost-plus pricing

By instituting these flexible pricing options, you ensure your staff and firm are getting revenue commensurate with the value they’re providing. You meet clients’ expanding expectations and grow your firm simultaneously.

Lack of available accounting talent

According to the Wall Street Journal, more than 300,000 accountants and auditors have left their jobs between 2020 and 2022. Relief isn’t coming in a wave of reinforcements: many college students — even accounting majors — are foregoing traditional career paths through tax and accounting firms and instead opting for higher starting salaries in banking, tech, and consulting.

As a result, 67% of respondents said recruiting new employees with the skillset and experience necessary to thrive at their firm is challenging, and almost as many said the same about training and development of existing employees.

In the face of this, many firms are turning to technology. Automation can reduce the workload for staff, but it can also be an attractive feature for potential new hires. Eliminating routine tasks allows these younger accountants to focus on those more meaningful tasks that involve human interaction and problem solving.

Technology can also facilitate remote working, providing staff with the greater work-life balance they desire. This tech also allows you to knock down geographic barriers; with remote work, you can hire the best talent from anywhere, not just the best local talent.

Technology can facilitate learning and development, another essential aspect of attracting and retaining staff.

“Another thing that staff are really interested in is, are they being developed enough? Are they receiving the training and the experience that they want? If they are merely preparing little sections of a tax return all the time, and that’s all they do, they’re probably not going to stay at your firm,” says Shaun Hunley, Tax Consultant, Tax and Accounting Professional Services at Thomson Reuters. “Finding talent is always very difficult. But retaining them is even more difficult because they do have different priorities, perhaps, than the owners do.”

Finally, firms may need to rethink salaries, retention bonuses, signing bonuses, and other compensation to lure and keep top talent.

Evolving client needs

The secret to growth and continued success isn’t much of a secret — it’s meeting clients where they are. But, as noted, client demands are changing.

“We’re seeing consultants using the tax returns to provide consulting and advisory services,” Hunley says. “What happened over the COVID era is we saw things like the Paycheck Protection Program (PPP). We saw the employee retention credit. We saw things that perhaps accountants didn’t traditionally deal with a few years ago. They stuck toward tax; that’s all they wanted to do, but the clients maybe pushed them a little bit more out of their comfort zone into non-tax areas. What I’m seeing with accounting firms is that they are slowly, perhaps more quickly now, moving into more of a total package approach. They’re not just tax advisors, per se. They are an advisor in many different aspects of a client’s life.”

Here, too, technology provides an answer. Proactively advising clients requires having the correct client data at hand. That relies on the client providing that data, which can be frustrating for firms.

Solutions allowing easy, instantaneous data uploading can eliminate this waiting game. By making the data flow more manageable, you’ll have more time to serve your clients better and clarify how new laws and situations will impact them.

That will mean more responsive and personalized services for clients and the data to anticipate their needs. That kind of service builds client satisfaction and loyalty, which leads to firm prosperity.

Navigating the shifting landscape

Public accounting firms are trapped in a shifting landscape as employee and client priorities and needs change. To maintain their ground or advance on the competition, firms need to evolve with it, and the best way to do that intelligently is with a well-thought-out strategic plan that can adapt as you continuously evaluate your firm, staff, and clients.

Meeting the goals laid out in that plan will require technology, such as automation of tedious, time-consuming audit data entry. By streamlining workflows, improving efficiencies, and driving innovation, technology is a catalyst for future growth and success. The result? A driving force of innovation that propels your firm towards unparalleled growth and success.

Ready to future-proof your audit practice?

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