024 Hiring That Works For You

Hey, it's Thursday. Friday. I totally didn't say Thursday here. Haha. Omg. And we're talking about finding the version of hiring that works for you. Do you even want to hire? Are you hiring the right type of people? The right way of getting the work done? Something I'm smacking the middle of right now, like, do I want to hire? Do I not want to hire? Let's talk about it. Finding the version that works best for you. All right, so the last roast of firm video I posted on the main YouTube channel, not this YouTube channel, blows my mind. People are finding this show and don't know that I have another YouTube channel, but a little series I do where I anonymously roast firms. They give me a bunch of info about themselves and then we just publicly kind of talk through what they're going through and maybe some improvements that they can make. But the video, the roast video I posted last Sunday, the person who owns the firm mentioned they said something in a way that I think rubbed people the wrong way. And I don't know that I even should have like shared the exact verbiage because the context in which people give me this information, like I can't disclose what the firm is. I don't know how much thoughts actually going into like the wording they're using, but the exact quote was, I get very tired of rallying the troops. But this has gotten better after we as a team all took the working genius and disc assessments and know each other better. But people got people latched onto the phrasing of the I get very tired of rallying the troops as potentially an indicator that managing people is not something that this person's ultimately going to enjoy. And the context of this firm, single person founded the firm and they've got like three part time people working for them and they're growing pretty quick and kind of having to decide what to do next. And for all of the glorification of building big cool, rad firms and your dream team and all that stuff, I think there's more firms with no employees than firms with employees out there. And honestly that's probably for good reason because working with other people and managing other people, it's not for all of us. And that's totally fine. But the hard thing is how do you like learn that about yourself and ensure that you don't get yourself into a position where you're fundamentally not gonna be happy or not do well by other people, because maybe it's just not something you're willing to invest in yet. So something I would love to hear from y' all who are engaging with this is how did you learn if that was something that you even A, wanted and B, were capable of doing in the first place? Building a team. Because I think there's a. There's an element of that being the default or that being the path to success is just having a team. And that almost becomes like this vanity metric. You're outgrowing yourself. But there's a lot of people that are either just gonna not enjoy that or just be really bad at it and probably shouldn't do that. I've done both. I. In the firm last year, we had a team of about 40, and I was responsible for way too many of those people. And right now I don't wanna have a team. Like, that's just where I'm at. I got kind of burned out doing that. And I'm sure I'll, like, rebound at some point and have that motivation again. Because there's a lot of amazing things about running a team. And, like, the greatest satisfaction I ever had in running a firm wasn't in what we enabled for clients. It was actually for the opportunities we created for team members and, like, enabling them to kind of grow into a better version of and more successful version of themselves and just kind of enable that path. That was the aspect of firm running that I will remember the most. But right now, boy, all that sounds like a lot of work. I don't. The only mouths I want to worry about feeding right now are the little tiny ones running around the house whose diapers I still have to change. So that's where I'm at today. Doesn't mean that's where I'm gonna be at forever. But for you as a firm runner, you gotta, like, have that level of self awareness to even know if that's the thing that you want or not. And that's honestly a benefit of maybe having worked with another firm in the past where maybe you had a little bit of managerial experience where you could see, like, was this something that I enjoyed? I. Or something that I fundamentally shied away from? Because if you didn't enjoy it, then, like, the added stress and pressure of being responsible for these people's, like, professional livelihoods, that's a really big stressor. That was like, the biggest thing that kept me up at night. That being said, I think the healthy thing to kind of temper that with is it can also be easy to conflate your own worth to this person when at the end of the day, their accountants if that person. If you couldn't employ that person anymore, you could literally drop a comment in this video and someone else will probably have hired them within a week or two. So part, like, there is a risk there of, like, I think in our head, sometimes we overstate our own importance when it comes to the growth and development of our own employees. I talked about this in the episode where I ran through why I left the firm and kind of overcoming that. I actually think for me, that was a really, a really helpful reality check for how important you think you are versus how important you really are. Working with 40 people and you say, okay, I'm gonna be out of here. See you later. And like, that's the ultimate litmus test for who are the people you will still maintain a relationship with and who are the people that you won't like, who are the people you're friends with out of convenience and proximity and because you work with them every day versus the people for whom this is a job. And you as an employer are in many ways kind of a means to an end. Like, you're paying the bills for them, and that's why they turn up every day. That, for me, was like, actually a really healthy exercise and putting all of that in perspective because we carry the weight of those people's expectations and signing the paycheck, you know, every month and stuff like that. And I think sometimes that can, like, make us think that maybe they need us more than they really do because there's an abundance of opportunity out there for accountants. But that's. That's just. Just a sad rabbit hole. So let's not focus on that too much. But when it comes to hiring, I think it's actually a more broad consideration than do I want to work with other human beings and manage other human beings or not. And I've been starting to hammer on this more in my main channel videos in that I don't think most of us approach hiring in a very robust way because we're just going out looking to make traditional hires. And that's the only way that we think about handling fulfillment. Not personal fulfillment, but fulfillment from the standpoint of getting the work done. So I think if you ask 99% of accountants if you got capacity issues, you need to get more work done. What are you going to do? You're going to go out and hire a tax manager or new associate or something like that? That's like, always the solution when I think you're actually better off diversifying across multiple approaches to fulfillment and ultimately traditional Hiring and having full time people who are totally focused on working for you and building like a dream team of unicorns is probably the best ultimate version of a firm, and for me would probably be the most fun version of that. But how many of y' all have that, that perfect team of unicorns who are gonna be with you until the end of time? And even if you do have that, I don't think it's a very robust way of building a system to get the stuff done reliably. Because right now virtually every firm is one person away from being completely hosed. And there's a whole lot of reasons that you could lose that person that are entirely out of your control. It doesn't matter how good of an employer you are, if you suck as an employer, okay, then maybe you've got a bigger risk there. But people move jobs, people change jobs all the time for reasons outside of your control. And if at any given point in time you are that one person away from being totally hosed, and that includes you. If you got sick tomorrow and couldn't work for three months, what would happen? Then you're like, man, like, that's a risky business to run. But that's what virtually all of us are doing. So what is a more robust version of that looks like it means finding more ways to get the work done, to have more redundancies in place there that you can lean into. And just having a pile of human beings who are your full time employees. That's very dehumanizing, I know. But only getting the work done that way, I don't think is like your most robust solution. So what I've been talking about in these videos recently is I think you need to get the work done across basically three different fulfillment channels. And that is traditional hiring. So that's full time, part time employees. I would even put offshore hiring into this category. In situations where the way the offshore hiring works is you get the entirety of that person's focus and attention. So like TOA Global, for example, when you pick up a team member in the Philippines through TOA Global, they're basically your employee. Like, they just work for you. You train them to do whatever you need them to do and they're just, they're part of the team. It's not like a, it's not like an outsourced group. It's just an offshore member of your team. I would lump them into the category of like traditional hiring, second hiring contractors. So that could be full time seasonal stuff, could be part time people, could be Hiring contractors through groups like Tax File, where they're like a, almost like a gig economy sort of version of doing tax prep. So like services like that, that will connect you with contractors. Upwork and fiverr are other examples. Now with every one of these things, I'm going to say all these things are gonna come flooding in your mind about what makes this hard and what works about it, what doesn't work about it. Like, that's the reason that we all hire the way that we do right now. And so like challenging some assumptions and like pushing through some of those things that are unknowns or make us uncomfortable right now, like, that's absolutely a prerequisite to getting to a fundamentally better place. Because right now I think the place most of us are in, being one person away from being hosed, is just not a healthy place. So first is traditional hiring. Second is contractors. Third is contract groups. And there's maybe a better way to say that. But with this third option, you are buying the work product, not somebody's time or deliverable. So most contracting arrangements out there, like they're still hourly, right or wrong. But that third option, contract groups, that is like an outsourcing group where you pay a fixed fee for a tax return or for a month end close, that sort of thing. And there are tons and tons and tons of those out there. But as opposed to like the TOA model where you're paying for a person's time and attention, you're instead just paying for the output. And there's upsides and downsides to each of these things. Contract groups can be onshore or offshore. Doesn't matter. 7216 disclosures only apply to offshore contract groups. You can work with contracts onshore without having to do 7216 disclosures. If that's a stopper for you, I don't think it should be. That's another conversation. But if you think about how you, how the way you get your work done is weighted across those three categories, Traditional hiring, contractors and contract groups. Most accounting firms, it's like all being done through traditional hiring. And the downsides to me of traditional hiring are people coming and going, not being able to find those people. Ever heard of that problem? The stickiness of what you invest into traditional hiring and their expertise, and then the fact that when it leaves, it leaves, as opposed to building a relationship with a service where you actually delegate the friction of somebody leaving. So for example, I've talked about how we delegated a whole bunch of our month end closes to bench like I don't know, five years ago, six years ago, however long that was. We were their largest accounting partnership and that was more expensive than getting it done through traditional hiring methods. But I was delegating the fact that it was really hard to hire and retain and manage bookkeepers. So bench had a whole bunch of bookkeeper turnover. But part of the deal was they had to manage all that. Their job was just to get it done and I didn't have to worry about anything else. And we were growing so fast at the time that I was willing, I was happy to pay a premium for them to manage all that stuff for me. Because at that point in time, the least favorite part of my job was managing bookkeepers. And that fulfillment channel for me was fantastic. Their job was to get the work done by a certain date after month end. And they did a great job. They did it like we still had to review it, we still had to be accountable for the output. But like, imagine like the ability to delegate that stressor. If you could hire a manager who would come in and do that stuff for you tomorrow, most of us would. And that was the value to me at that point in time of a contract group. So diversifying your fulfillment, how you get this stuff done across those different types of work, I think is just a much more resilient way of getting the work done. Because if you get sick, you've got people, you've got services, you've got contractors who are fractional that you can flex that workload across. If all you have is employees, somebody leaves. If you got a team of 100, okay, great, maybe you can flex that across their team of 10 people when they leave. Still nobody's gonna be happy about that if you got a team of two and one of those people leaves. Whoa, buckle up, big boy. That's not gonna be fun. But regardless of the size of your team, when somebody leaves the ability to flex that work either permanently or temporarily across contractors and contract groups, that's really nice. At the end of the day, you are responsible for the output. You still have to do the final review. You're still the one signing everything. How the work gets done, I think, in my opinion has never been less important. And I think these services will get better actually as technology and AI stuff is taking off. Because these like contract groups, if they nail these processes and get really good at it, could actually do it to a really high level, really efficiently. So I think like the way tech's going, that may actually benefit contract groups. But for you, your job is to Deliver correct work. And generally, your client's not gonna care how the sausage gets made. But more importantly, it's not up to the client to dictate how the sausage gets made. I know firm owners who, like, all they do is work with contract groups. They've got four or five different contract groups they work with at a given time, and they're the face and the final technical review. And even across those contract groups, they are diversifying because sometimes something will happen with one, sometimes something will happen with another, but they can flex work across those as needed. And there are definitely, like, workflow considerations and things that get stickier about managing projects across different types of fulfillment. That's kind of an organizational skill that you can develop. There's also real cost considerations. Oftentimes that's going to be a more costly way of getting the work done. Like a contractor that you're paying a higher hourly rate than you would be paying to an equivalent employee. But the upside there is flexibility is security redundancy. Like, you're gonna have to pay something for that. But I would argue for most firm owners, if you run a team, the greatest stressor is losing a team member. Like, the kind of existential dread of that happening. Cause you've been through it in the past. You know how bad it hurts from. For that key person to leave. And you're like, what the heck am I gonna do now? Like, I actually think that's what's driving firm runners out of the profession is not being able to find the right people, quote, unquote, and just how disruptive and painful it is when that key person that you have leaves. So in my mind, this is the solution. Like, it's. It's diversifying your fulfillment across various different ways of getting the work done. And when you're thinking about, do I want to hire? Do I want to manage people? I actually think that answer is different across these different types of methods for fulfillment. So, for example, I used to have an employee that edited all my videos. I decided I don't want the overhead that comes with that. And now I've got a contractor that does it. And the difference for me and the obligation I feel to that individual is totally different. Like, when it was an employee, it was like, I'm paying their health insurance. Like, they're totally reliant upon me. And you don't have that with contractors. Like, it's like, it's just. There's a different level of expectation there. And so, like, I have a great example of I'm someone who like, right now, I don't really want employees. That doesn't sound fun to me. I'm kind of still recovering from having that in the past. But contractors are great for me. So, like, if you're on that threshold of like, do I hire another person or do I hire my first person? Like, learn about those other channels. Because if an employee isn't the right answer for you, like, that's not the only answer. Like, that's not the only way to get the work done. Contractors are worth considering too. Contract groups are worth considering. So that decision of, do I make that next hire and do I want to manage that person? That's almost like an independent decision that you can make for each of those channels. Working with a contractor still means managing that human relationship. Working with a contract group is like, hey, I'm buying this thing, and it's your responsibility to make sure that it gets done to the level that I needed to get done. And generally, you're gonna pay a little more for that. But it's a different level of kind of what is required from you. But I think when we normally talk about firm growth and getting the work done and all that, like, it's strictly through the lens of hiring people, but I just don't think, like, that's the. The way the world is trending. In fact, when I was on the AICPA town hall the other day, this is something they were talking about with the, you know, the pipeline shortage and all that stuff is firms kind of challenging the assumption of the way that they need assumptions of the way they need to get the work done and start leaning more into gig work kind of stuff and diversifying across contract groups. They said this right before I went live doing. Talking about some AI stuff. And I was like, yeah, ultimately you can't just be like a one, like one person away from being hosed. Like, and that's where most of us are. If you're a solo operator, you're absolutely there. And that's can be hard to get away from. But I think it's worth challenging some of those assumptions of the ways that we can get the work done so that you've got a more resilient version. Your firm. Okay. Hey, new segment alert. Mailbag. It is where I open the things that people send me. Listen, I love you all, but I love Alison Reif Martin more because she sent me a very nice thing, very nice letter. But it also included this little booklet, Taxes and Punishment, which is honestly, it's a collection of really unfortunate accounting puns. Why are frogs so happy? They eat whatever bugs them. Why doesn't Santa have an accountant? He's elf employed. Why should you wear glasses during math class? They say it improves division. Ugh. What do you call a piece of toast at the zoo? Bread in captivity. What's that have to do with tax. What's the difference between Al Capone and Anakin Skywalker driving an Uber? That's very specific. One is a tax evader, and the other is a tax evader. Okay.