Building a modern firm…it’s not a new idea. In fact, here at Rightworks Academy, we’ve been talking about The Modern Firm® for at least a decade. And while it’s not a new concept, there are probably a lot of different ideas of what a modern firm looks like, how it plays into an accounting firm’s strategy, and what it takes to build one. But before we jump into all of that, let’s set the stage with a quick stroll down memory lane.
Years ago, Darren Root, Chief Strategist at Rightworks and founder of Rootworks, found himself in the midst of a denim dilemma when he was out shopping for a new pair of jeans with his kids. He had selected a typical pair of jeans with no idea of what was about to transpire and, ultimately, transform his life. As we all know, kids have a tendency to “keep it real,” and that’s exactly what Darren’s did when they told him he was dressing like an old man. It was at this point when Darren realized he had been stuck—“not just in fashion, but in life.”
Now, if you’ve met Darren at any point in the last 15 years at least (that’s about how long I’ve known him), you know that he’s no longer stuck in fashion, and he’s no longer stuck in life…or the office. He took this “keeping it real” moment with his kids, and he got to work building a modern firm. (And, yes, he also started building a modern wardrobe.)
So, what does it mean to be a modern firm?
I think the biggest lesson we can learn from Darren’s story is that in order to be modern, you have to stay adaptable. To build a modern firm and stay relevant, you have to be open to the opportunities that come with change. Technology continues to evolve and challenge firms, but that doesn’t mean you have to get left behind.
You can set your course for success by acknowledging and embracing the reality of where the profession is headed. In other words, keep it real. Stay authentic and be open to learning. But most importantly, stay adaptable.
Building a modern firm is a journey, not a destination. But you have to take the first step. And then, you need to commit to taking the next one, and the next one, and the next one….
What’s the first step to building a modern firm?
Well, it all starts with your business model—your who, what and how. In the past, we’ve referred to this as Smart Firm Management. But the idea remains the same: You have to be intentional about the way you run your firm. And that starts by asking yourself the following three questions:
- WHO do I want to serve?
- WHAT do I want to sell?
- HOW do I want to deliver those products and services?
When you operate your firm with great intention behind your responses to these questions, you allow yourself to focus on growing your business instead of simply maintaining and surviving it.
How does building a modern firm fit into an accounting firm’s strategy?
If you take the first step by being very intentional about your business model, you’ll see that building a modern firm has everything to do with your accounting firm’s strategy. Let’s be real (again): No one starts a business with the “intention” of failing. So, when I use the word intentional, I mean being very deliberate and strategic with your choices and decisions to reflect what is most important to you.
And I’m guessing if you’ve made it this far, then one of the things that is most important to you is people…and relationships. So, let’s talk about the next step, which is all about some of the people in your firm—your clients. But not just your clients; let’s talk about your ideal clients.
To build a modern firm, you must focus on your ideal clients. In the past, we’ve called this Smart Client Management. Look at your client base and ask yourself these questions:
- Which clients are we good at serving?
- Which clients do we enjoy serving?
- Do they fall into a specific niche?
- Which clients pay on time?
- Which clients consistently use the apps that make up our tech stack?
- Which clients purchase additional services from us?
When you’re strategic about building an ideal client roster, you’re setting your firm up for success…and you’re staying adaptable. Building your modern firm with ideal clients not only opens the door to offering higher-value advisory services, but it also shows that you care about your team (more on that later). When you make finding your ideal clients a priority, you take back control of your firm. You decide who you serve, what services and products you offer, and how you deliver them.
What else does it take to build a modern firm?
If you’ve done the work of intentionally outlining your business model and you’ve identified your ideal clients, then you’ve likely already found the people who will be on board with the way you deliver your products and services. And yes, we’re talking about technology. Your tech stack, specifically.
To build a modern firm, you need the right tech stack, and you need to operate in a secure environment. We all know that technology is ever-changing and evolving. This is why it’s so important to stay adaptable.
There’s a reason the new CPA exam puts a greater focus on technology across all disciplines. Technology is a big player when it comes to accounting firm transformation. Embracing technology and tools that allow for streamlined processes, seamless workflow and automation will allow you to add to the strong foundation of The Modern Firm you’ve started building. The right tech stack will enhance collaboration between your staff and your clients. Not only that, but technology-mature firms earn 39% more revenue per employee. That’s how important the right technology is.
And as you think about a tech stack in a modern firm, you can’t ignore that the most efficient and secure path for delivering your products and services is in the cloud. Not just any cloud, though. The intelligent cloud. And this is part of what we used to refer to as Smart Security Management.
An intelligent cloud platform allows you to streamline your firm’s processes in one central and secure location. This is one of the most important components of a modern firm because it allows you to stay competitive and adaptable. And it keeps everything safe, secure and connected. The intelligent cloud is a must-have strategic choice for modern firms.
What holds a modern firm together?
Earlier, I mentioned there’d be more about your team later, and here we are. This is where everything about a modern firm comes together. This is what we have referred to in the past as Smart Team Management. Sure, all the other components matter, but taking care of your staff is just as important. Your culture and your people have to matter. They’re the glue that holds your modern firm together.
And if you think about it, when you’re intentional about all the other parts—your business model, your clients, your services, your tech stack and your security—then you’re already telling (and more importantly, showing) your team that they matter. You’re putting your accounting firm strategy together in a way that makes life better for not only you and your clients, but for your staff as well.
And when you’re intentional about your firm’s culture and the way you treat your staff, then everything else comes together. When you provide clarity around your who, what and how, then you’re taking steps to create a healthy and sustainable culture.
Prioritizing your team demonstrates your commitment to their well-being. And when you have a happy staff, that translates to people who enjoy their work and provide better service to your clients. When you have a healthy firm culture, it helps you attract and retain top talent. And we all know how important this is given the staffing challenges in the accounting profession.
A modern firm: Summing it all up
Building a modern firm is all about intention, strategy and adaptability. When you apply these three things to every aspect of your business, you put your firm squarely on the path to success. I said it earlier, but I’ll say it again: Building a modern firm is a journey, not a destination. And if you want to differentiate your firm and stay competitive, you need to take the first step.
Dig into our free whitepaper about The Modern Firm Maturity Continuum to get an inside look at what firms like yours are doing to adapt and evolve.
When you’re ready to start your modern firm journey, Rightworks Academy is here to help.
