Why Every Accounting Firm Should Do THIS in 2025

Hey, this is Isaac from Upstart.co. And in this video, I'll share how you can map your processes so that you can visualize opportunities to automate, simplify, and improve your work. This is a workshop I did in Future Firm, Ryan Lasane's community, and just want to replicate and discuss this in a shorter format here for you guys on YouTube. With that, let's get into it. So who's meant to benefit from this workshop for this topic? If you are a life science firm owner, you want more time with your clients versus the minutia behind the scenes, this is for you. If you have a growing accounting firm and you want to scale without sacrificing service quality, process mapping will be incredibly important. And if you're an operations leader and manager, director of operations within a larger firm, and you feel like your team lacks clarity on what and how to deliver, this is also going to be incredibly beneficial. For those of you that don't know me, my name is Isaac Perdomo from Upset.co. We run an automation firm that helps accounting firms do more with their existing team and software. And we do that through a combination of process consulting, technology consulting, and So what's a process map and why is it useful? To define it is essentially nothing new and nothing surprising. It's just a visual representation of how work gets done, but it can be incredibly helpful in helping you visualize what the process currently is, not only for you, that maybe it's something you already know if you're the firm owner, but for your team as well. Because visual can be processed significantly faster, it's a way to communicate the process to others incredibly quickly. Also, it's hard to improve what you can't see. So by visualizing it in a collaborative way with your team, you can now pinpoint specifically what are the areas of improvement of that process that you can put in place, whether it's simplifying, standardizing a particular step, or of course, automated. Once you see it, you cannot unsee it. And that's the thing, like the moment you do this once, I promise you that you'll be like, okay, let's make sure we do this for all of our core processes and core workflows. So what will we map and what level of detail is most useful? This is a question we get, 'cause of course there are varying levels of granularity and detail that you can provide or you can have in a particular process map. And I'd like to discuss 3 levels of details from the top to the bottom. So the first one, let's call level 0, is just business departments. If you actually read the book Process from the EOS Mastery Series, you'll see that they, what they call process is typically what someone Meaning I would call a department, like they talk about HR process, the marketing process, the sales process, the accounting process. I think that's relevant for them in the context of working with larger organizations. I do think that this is, you know, this should be a 5 to 10 minute exercise of like you naming your departments and being clear on what are you going to call them internally for clarity. But this is not typically the most useful from a process improvement standpoint. It can be useful to map out what is the hierarchy, right? The top level of departments. So then you can double-click into one of them, which leads me to the next level of detail, which is a high-level process map. In this case, you're not really getting into the weeds of how exactly you do a thing, but you might probably see somewhere around, I'd say, 5 to 20 boxes representing different steps. And some of those steps will be typically very summarized and short, like you're seeing on the screen, like brainstorming session, researching, reviewing, designing, implementing, et cetera. And of course you can go overboard as well and have a super detailed flowchart that's almost akin to an SOP, which describes specifically each individual step in a process that a human has to take. Each level should align with the next one. And that's probably the most important part. Like if you do that exercise to map out your departments, make sure that now you can double-click and list what are all the sub-processes within that department and within each one of those processes, what are the steps that happen underneath? And to give an analogy that hopefully will help clarify and make this a little bit more concrete, if we're talking about a factory, right, level 0 would be really how do we design the factory? What are the different areas we need, right? We need a warehouse, sure. We need an assembly line. We need this. We need that. Similarly, you're going to need to market for people to find your firm. You're going to need to convert those leads into customers. You're going to need a delivery team or production team to deliver that, et cetera, et cetera. So this is just thinking about the buckets, the bigger buckets you need to produce the thing. In this case, to run your business and produce work for clients. But then you can double-click in a specific assembly line, right? And think about, okay, from A to B, what is happening exactly in that particular assembly line? And that might be an assembly line that multiple people are involved. This is typically the most useful level of detail, but you can even go a level deeper and say, okay, what does this human has to do in this step of the assembly line with this particular machine? So hopefully you can see how the different process maps have different objectives, right? You can have the higher level one that's really would involve the entire firm and usually will influence how you're structuring your company. A side note here, actually not part of the script, but many firms would benefit from that exercise also from the perspective of making a decision around pods and pod structures and whether you're going to organize your firm in a more traditional partner hierarchy where you have partners and different teams underneath them, or you're gonna structure in a more traditional corporate structure with CEOs and leaders in specific business functions. So it's useful for that too. But specifically today, we're not going to go that higher level. It's specifically focused on the high-level process, which typically, as we've mentioned, involves a particular team and typically influences or results in the workflow template that you'll have on your practice management or project management tool of choice that are like the higher-level steps and the checklist that your team has to follow to get a particular piece of work done. Of course, we talked about the detailed one, which typically involves one person. It really would end up becoming either a subtask within the workflow template or more likely like an SOP. to instruct and teach that particular individual how to get that particular step of the process done. So the middle is the sweet spot for most people. And let's talk about how. Of course, if we want to visualize, we need a tool, a tool of sorts. If you have the privilege of having an in-house team or you are doing retreats and you are able to get them together, it can be useful to go the whiteboard way and analog, or you just map things out. You go, you will pick something like this with a bunch of sticky notes. You write the different processes, you just paste them in the whiteboard, organize them, and brainstorm in that way. Not many of us had that privilege, so I want to discuss some other options. Other options might be like Zoom's whiteboard feature. If you've ever used Zoom, if you pay for it already, when you go there, you have the ability to create a whiteboard that everyone can see and collaborate in. And there's also 2 tools that are used very frequently in the flowcharting world, one of them being Whimsical, which is the one that we use internally and recommend. But there's also Miro, which has many similar features and it's equally powerful. Now, what are the steps we want to take to develop that process map and ensuring that we are actually selecting the processes that are going to give you the most bang for your buck? The steps are the following. First, select the key process. We're going to talk about some selection criteria that you might want to keep in mind. Define boundaries. Where does it start? Where does it end? That you want to make sure you have the scope. Of the process map clear from the very beginning. Ask what's next if you want to go from the very beginning, the very first step, and clarify each of the steps that happen from the very beginning in that first step all the way until the final deliverable. And then sharpen the process, which is how do we improve it now? And actually, I use the word sharpen because I have a little bit of an acronym to make it easier to assess or understand what are the different process improvement techniques that you might implement. To improve a particular process. So let's talk about the selection criteria. There are many selection criteria around. I personally like for accounting firms specifically the PETER framework, which is effectively profit, errors, time, and revenue. Think about what are the services that you provide that potentially have lower margins and that you want to make sure your team spends time elsewhere. This is typically the compliance work. If you are a firm that provides compliance and advisory work, more than likely you'll be focusing on improving and automating the compliance work that takes a little bit more time, that might not be as high margin, such that your team can spend more time on that strategic and advisory work. Errors. If you have a process that it's continually being done wrong, if you have a lot of rework happening where maybe the individuals in the team, the individual contributors are sharing the books for the controller or the tax returns for the tax managers, and they have to like either redo that work, push it back whenever they have a lot of things like that happening. It's another way in which you can make sure you prioritize the process you pick to improve in the first place. Of course, time, the universal currency. And if you are, especially if you have like time tracking data, you can get very granular around like what are the tasks and services specifically that are taking the most time. If you, for example, track effective hourly rates by services, you can kind of rank your services from most to least profitable based on that particular metric and see what are the areas to improve. And sometimes it's like just revenue. If you are a firm, someone would talk about yesterday, they do 75% tax work and 60 to 70% of that was personal tax. So for them, it would be like dumb not to focus on their personal tax preparation process first. There are many other frameworks, as I mentioned. The important thing is to prioritize and have a good sense of where you're going to start to focus on. Because sometimes we get people like that one that are talking about, hey, Isaac, you do personal tax returns as like the core of our business. And then they're talking to me about client onboarding and like, and it's not that those other processes are not worth looking at, but you want to get the biggest bang for More often than not, we want to be looking at the process that you're doing the most often that's bringing you the most income. Some common examples: tax preparation, client onboarding, bookkeeping, close, sales tax filing, team onboarding, etc. So think about for yourself, what's your key process as you think about your own firm and the things, some of the frameworks and selection criteria we just discussed. Second, define boundaries. It starts to think about what's the final output, right? Envision the output of this particular process. Ultimately, that's what you're driving towards and the activities that you do within that only relevant or only valuable to the degree that they influence that output. So think about where does the process start? Is it a day that triggers that particular process? Is it a time? Is it a sale, right? Is it the fact that you just sold that client? That's when you should start that process. Is it a client request? This is a client reaching out for a particular piece of work and that's what triggers the process for you. And also get clear on where does it Is it an approval process? That's kind of the last step of the process for you. Is it a particular deliverable? Is it a meeting? It's very important to get clear on the first step and the last one, because sometimes there's not an agreement on that. You'll be surprised the number of times— onboarding is a good example where people might be, well, for us, onboarding starts with a deal in sale. But some people might say, well, we also consider client onboarding the process of discovery. So for us, starts with the inquiry in the first place. But some people might split that into like, well, this is a sales process, this is onboarding process. Process. Other people might bucket into the same one, and there's no right or wrong. It's just your definition, and make sure that you clarify that for yourself. So what are your bounds? Think about the process you select earlier in this video. If you can define your bounds and that starting point and that finish step very clearly, more power to you. So let's talk about step 3, which is really asking what's next. Once you have that first process very clarified and the scope of where that process ends, you can start talking about, okay, let's go through each step in the process one by one. Remember that Activities have no value. They're just a means to the output. And more often than not, you'll end up with a series of boxes in your flowchart. Keep it super simple and try to use verbs as the first word and nouns as the second or third word and try to keep it to a minimum of like no more than 2 to 5 words, for example. So those are some simple rules to keep in mind. Of course, you use arrows as well to showcase what is the direction of the flow. I already talked about that, keeping it short. To the greatest of your ability. So let's kick things off with a few templates. No opting required, at least as of this recording. If you go to option.co/pm, which stands for process map, pm-prep, that will have— lead you to our tax preparation process mapping template. If you do pm-book, that'll lead you to our bookkeeping month-end close process mapping template. And then we have sale for a sales mapping template, process mapping template, and onboard for my client onboarding mapping template as well. Important part here is to think about, okay, I'll go ahead. I have this map. I clarify it. I understand what are all of the steps involved. What do I do once the process is mapped and how can I effectively, now that I have the process clarified, improve it? So let's talk about that. So let's start with the word simplify, which many of you have heard, but we've spent a lot of time truly, truly breaking it down into actionable terms. Okay. So for the purposes of this conversation, we'll be— have a simpler process when one of 3 things are true. Either one, of all the steps that you've mapped, You're able to delete one. Number 2, you standardize one of them, which means that if there's a particular step in your process that you're doing multiple ways, you find a way to do it in fewer ways. And we'll talk about some examples. And number 3, if you just find a better way to do a particular step in that process, and we'll talk about as well some of those examples. And of course, if you're able to automate a process so that human doesn't have to do it, that's a better process too, in my opinion. Okay. So let's talk about deleting. In practical actions, if you look at all the steps in your process and you're like, could we get away without this? And I like the way that's phrased because it's not like, is this important or should we do this? It's, could we get away without this? Triggering you to think, is there a world where this step wouldn't be needed? Even if we don't think that's the case, because many people would say, that's how we've always done it. That's one of the toughest phrases to hear for me, but it's like, okay, that's how we've always done it, but is there a better way? Also ask yourself what's causing delays. Is there a particular approval step that's causing delays that you can get rid of? Would clients pay for this? Important question, is this actually value additive? And is this being done already? Because more often than not, especially for example in the onboarding process, we might say, okay, now we're adding this particular client, new client information in 17 apps. So we're duplicating that effort across our organization. So that's deleting for you. Let's talk about standardizing very briefly. Standardizing, it's really at its core listing in how many ways you do a thing and removing one or more ways. What does that actually If you are currently supporting QuickBooks Online, Xero, NetSuite, Sage, you know, whatever proprietary software your client has, now you can see how you are supporting clients in multiple platforms. If you remove one of those platforms, congratulations, you standardized. Same thing with communication channels. If you are talking to customers via Slack, via email, via text message, via call, on-site, via fax, the moment you remove one of those ways, guess what? You've standardized. So the word standardized, I think it has a connotation that you are like restricting things and like, like this big amorphous word, but truly if you just remove one or more ways in which you do a thing, you are on your way to a more standardized workflow. And it can be done both at the client level, as I talked about, maybe that you only support clients in certain industries or in certain platforms. Can be done at the service levels. Maybe you choose not to offer payroll and, you know, outsource that to a particular, to another partner, or you choose not to do personal And then you refer that away. And also at the process level of the individual steps that we have in a process. I gave the example of communication channels already where you might be talking to customers in multiple ways. In that particular instance, you might want to remove one of those ways to standardize it. A quick comment I'd say is like sometimes you might not want to do that if you're going to give your clients that flexibility. And that's where technology comes in handy because it can help you even though the client can message you in many ways. If you standardize that and bring that all to one centralized place where all your team can reply, then You still standardize the way in which you reply and check those messages, even though the client has the flexibility to message you in multiple ways. Same concept with the payment method. For example, if a client wants to pay you via credit card versus ACH, and you don't want to say no to business because that's the only method they suggest they are comfortable with, tools like Ignition Anchor, Noola, and many others will have allowed you the ability to send them a proposal, allowing them to select the method in which of how they want to pay. So you don't have to now manage like a payment processor for credit cards. And a different platform for bank transfers, for example. And then we optimize, which is the third word in our breakdown of the term simplify. After you've standardized, which means we've reduced ways in which we do these steps, and you've deleted, which means you've gotten rid of steps altogether, there are steps that are left. You have to find a balance, which is what the word optimize comes from, right? It's an optimal spot where it is neither One extreme nor the other, and I have five verticals, five elements, or five factors in which you can kind of evaluate a particular process through to assess is there anything you can do to find an optimal spot for that. Let's talk about that because that probably didn't make sense, but it will make sense now. Okay, so finding a balance between the first S of the sharp acronym—it's sync versus async. Do you really need to have that call? Do you really need to have that meeting? One of the big improvements one of our clients. Implemented recently because they're a big personal tax preparation shop based out of Canada. They were meeting with every client and offering a meeting to every client. And of course, that took a lot from the partners, especially during the busiest time of the year. And what they did is they flipped it and then started asking their questionnaires, what do you want? Do you want a meeting or would you rather have a video summary? Many people selected the video summary, and now you have the ability to do that work asynchronously. In other words, not at the same time. With the client. Another term we have here is hands-off, handoffs. How many handoffs happen in the process? If the process goes from admin to preparer, from preparer to reviewer, from reviewer to preparer again, from preparer to admin again, the more handoffs you have, usually the more inefficient the process. But also you don't want to have no handoffs because that means one person is doing everything and you want to specialize that work. So it's finding that balance of, okay, if I know 3 people are going to be involved in this process or in this client, how can I make sure that each individual blocks their time to do what everything they have to do and then pass the baton to the next person. And often a big improvement we find here, it's clients not having a good, for example, document review process so that when preparers sit down, they have everything they need to finish it in one block. And if you don't kind of perfect that process of that handoff, all of a sudden that preparer is going to have to, you know, do half of the work, pause, then come back later and not really remember where they left off. The third one is access. This is simple. It's essentially how much and how close the information you provide to your team is. Typically, this is in the context of, are you providing an SOP, a knowledge base, a template that they can consult? How, you know, large or big is that? How much detail you provide? Because you don't want to go overboard, provide too much. You also don't want to provide too little. Then we have resource timing. Do you schedule your work or do you work on demand as clients request? Of course, we're going to have some flexibility because if clients will appreciate that you're sometimes available immediately or within 24, 48 hours versus people like Brandon Cannon from, from the accounting community that they schedule out all of their work, all of their tax preparation work for the beginning of the year. And then there's really not as much flexibility of like, hey, I want my things done earlier in the year. So it's also finding that balance of what work do you schedule out and what work do you do on demand. And last but not least, it's processing, seeing if those steps you mapped out, is there any of those steps that you can do in parallel rather than doing linear? So a good example that I always like to give is video thumbnails of, hey, maybe once you finish writing a script for a video, if that's something you do your marketing department, you can get both editor and designer to start working on their own things at the same time. You don't have to do first the editing and then the design, nor the other way around. Those 2 steps can be done in parallel. So also think about in that process map, what steps can be done in parallel so that you can save time. With that, that it's pretty much it. And in short, just to summarize here, pick and visualize a process, delete what you can, standardize what's left, and optimize and automate the rest. And if you enjoy this video, you're just going to enjoy this other video as well, where I discussed specifically the client onboarding process and breaking down into steps, just like what we talked about, how to improve them and the technologies to use to streamline it for yourself. I'll see you on the next one. Until then, stay efficient.