449 Watch This if you’re Trying To Hire an Accounting Unicorn

It's a great week to run an accounting firm, even if you're trying to do the impossible of hire a senior tax manager, senior accountant, or that unicorn that can do both. Most firms have perpetually had these job listings out for like years on end. And it can be really easy to point at that job listing and think, universe, if you would just deliver me this person that has the exact combination of things that I need right now and will fill all of the holes, then, then everything would just. Everything would be fine, right? That's not your fault you can't find good help anymore. Let's talk about that. Because while we should always be looking for, like, talented folks that we can pull into our firm, there's a huge spectrum in how much we rely on expertise. And oftentimes the best path forward for most firms is not that one more person, especially not that one really big, expensive, high stakes person, because on the other side of that unicorn, oftentimes on the other side of that's a whole bunch of key man risk. You're holding out for that perfect unicorn. But have you ever lost a unicorn? Something about the idea of losing a unicorn just makes me emotional. I don't know. I'm sorry, Come on in, let's talk about it. A while back, I put together these guides for like, running different types of accounting firms, from side hustle firms to solo firms to big firms like 3 million and beyond. And it dawned on me just how much of a crutch hiring can actually be. There's a certain purity to running a solo accounting firm, I can tell you. It's not for me because there's just a whole lot of, like, byproducts and admin and all that stuff that's unavoidable when it comes to running an accounting firm. And, and for the people who do it solo. Bless your hearts. I know there's a bunch of them that listen to this podcast, but given that constraint, you can't hire anybody, you would behave very differently. Whereas a lot of firms, we just keep growing. We don't have to stop and think and plan or capacity plan or any of that. We just kind of go out looking for that next person when things sort of get uncomfortable, when I feel like I'm working too much. And in many ways, like, that's. That's the easy route. That's the easiest thing to do, rather than stopping and reassessing how and how we're doing things and who we're doing it for, to see if there's maybe a more intelligent Path forward. This is true. And so many aspects of accounting, it is oftentimes easier to run into the same wall for the 10th time than stop and reconsider. Recalculate. It can be easier to work a hundred hour week than stop and reconsider how we're doing things. You did your best, right? Honestly, like, boy, I fooled myself on this front for years thinking that by working my little accountant heiney off working ungodly hours that nobody else could understand, everybody else that wasn't an accountant, they were so impressed by how much I worked, thinking that that meant I was doing my best. When in reality that usually just means you're running from some big mistakes that you've made and you're running away from acknowledging them by trying to like outwork them, as if on the other side of outworking them, they're just gonna go away. This started out way too personal. Cool it, guy. Okay, so how do we stop and sort of recalculate what we're doing? Six things I want you to consider before going out and trying to find that unicorn. Number one, remember that reliance on expertise is a product of systematization or a lack thereof. So if you don't have any systems in your accounting firm, you're super, super reliant upon expertise. You need the people that can just hop in and figure it out. Whereas if you have a process that is more on rails, you can plug just about anybody into it and get really good outcomes. There's a reason that Amazon's warehouse, they don't just hire like 200 IQ people and say, listen, we're going to have a bunch of orders we're in, fax them in. If you can just figure out the best way to put them on the truck, they go to the other end of the spectrum. Traditionally not super highly skilled people, but you better believe that the things that they're asking them to do are absolutely on rails. And there's very clear like performance metrics of what the expectation is for those people. And you could walk into two accounting firms today and see one accounting firm that looks more like an Amazon warehouse. Like even, honestly even the, the, the negative things about Amazon warehouses, like there are also accounting firms that are that way, but there's also ones that are on the other end of the spectrum. And, and gang, I, I say this with love. I wouldn't say this if I didn't care so much, so gosh darn much about you. Oftentimes it's the little firms that have the PhD stumbling around in The Amazon warehouse, just trying to deliver things as efficiently as they can. And oftentimes that PhD, it's you, you're the original unicorn. And you're like, I'm just gonna, I'm gonna, I'm smart so I can run around and figure all this stuff out. But then you make your first hire and you're like, oh, how do I make them productive? Or you find yourself in a situation where you're just blocked on senior level people and you're like, why? Back to the I, I can't find good help. Nobody can do the things that you need done. And so the firm is kind of just paralyzed until you find the person that can figure all that out. I. This was my firm. I mean, we had the very traditional firm sort of hierarchy of you had these seniors, and the seniors had decades of experience and you can kind of just throw anything at them. And like, one very practical example of how he backed away from that. And I think we did a whole podcast episode on this in the past. But like, for tax return review, this was individual tax return review. And you can do the same thing with like financial statement review as well. But we basically set up a scoring system, 1 through 5, for how complex returns were. And there was a, there was a threshold beyond five that was kind of a catch all for everything else. But the people within the firm were approved to prepare and review returns of different difficulty levels. And this isn't like a novel sort of thing. There's a lot of bigger firms that will do this, but it's, I would say it's much less common in smaller firms. But one really nice thing was it destigmatized review, the notion of like being the final person to see a return before it goes out the door. It was this built up to be this big scary thing that only a few approved people were allowed to do. But instead it made review everybody's job. And so pretty much everybody, if you are a preparer, you could also review like the level of return below you, like below your ceiling of the maximum sort of technical level you are allowed to do. So everybody was pitching in on review. And if you compare that to the firm where only reviewers do review, then reviewers are always the bottleneck, right? And we were able to do this by systematizing what it looked like to review these simple returns. Now, building a system for a. Something as complex as a US income tax return, that's very, very hard. But for the most simple returns where a level one, it's just like pulling stuff off of W2s and 1099s. You can build a system for that. And do we still find ways to break that in ways that the system was lacking? 100% Honda P Buddy. But it still meant that with that system we could plug just about anybody in to review the very simple stuff and get it out the door. In my experience, this can get a huge volume of workload off the plates of your most senior folks. And it was actually at a point of necessity where I rolled this out in our firm because we were heading into a tax season where due to staffing changes, we just fundamentally didn't have enough senior people to get all the stuff done that we had committed ourselves to. And I don't recommend this. Don't commit to work that you don't have the personnel to complete. But this sort of forced our hand and was a great reminder that like any level of systems, it reduces the required expertise of the people involved in the process to get to the same outcome. Now we've got a video on my main channel that is probably the most popular video I've ever done that that was like how I systematized our work from beginning to end. In fact, let's put that down in the show notes. We put together a huge free resource you could swipe to help with this systematization process. Totally worth doing, totally worth pulling your team in on as well. Like this is the best time of the year to do that, especially if you're a tax firm. Get the whole team in on how to build better systems. Highly recommend checking that out. So number one, systematization. I assume that's a word. If it isn't, just play along. Number two, deskilling our work, that is finding ways to push tasks that are currently on the desks of your seniors to other people. So very good example. Let's say you're doing month end closes and the person who does the books, they log in and get a few things from online platforms that you need every month and oftentimes a login break. So you gotta get the client to give you something. These are not things that a professional needs to do. So in past podcast episode we talked about building a pre accounting process. It's one word, pre accounting, and that is where you explicitly itemize all of the inputs that are required to complete a month end, close all the documents, all the screenshots, all the questions we gotta ask the client, build an explicit list of those things and then you have people on your team who at the first of the month or as soon as they can get that information, they go out and they fetch all that so that your professional staff, when they rock up to work on the month end close, they're not wasting time fetching things or chasing clients. They have everything that they need right there to do the hard stuff. And if you look at how your most senior people spend their time in most firms, there's still a shocking amount of time people spend processing documents that clients submit, taking them from A to b, fussing with PDF files, annotating PDFs, logging into sites and fetching stuff. I do not need my professional staff doing that stuff. This is where honestly I loved hiring like non accountants who are great operators who actually many of them eventually became accountants. But they could see holes in a process. They could come in and do that repetitive work and over time they like kind of by proximity learn that technical stuff as well. And before you know it they start like doing the work of accountants also. But like the, that pre accounting process, just as an example, we basically had admins going in and pulling and it was, I mean it was hundreds of things that we needed for all of our month end closes, like in total. But they would go out and they would pull all that stuff for all the month end closes that we were doing and just dump it in the file system. But then the professional staff was like, hey, could they actually like set up these work papers the way that we would name them and where we would put them? And so then they did that, like they used the naming convention for each of those things that they fetched. And I was like cool, thanks. Now the professional staff didn't have to prepare, prepare that work paper. Then it was like hey, could you actually like annotate that to like identify the, the thing that we usually identify in that document so I don't have to do that. And it was like great, that admin is now like preparing the workpaper and annotating it. And then it started going as far as like hey, could you like here's how bank RECs work in QBO. Like could you come in and help with this? And they're baby stepping into like doing a bigger and bigger percentage of the month end close. And that changed. Like in the case of, of bookkeeping, that can genuinely take 50% plus of the time that your professional staff needs to spend on that month end close. Like it can shave a huge percentage of the time they have to spend off just by descaling as much of that as we can. Today's episode is sponsored in part by Teamup who helps you directly hire talented accountants in the Philippines? Ever wondered how much you pay a Filipino bookkeeper? Pop quiz. Does not pop. I'm just going to give you the answer. This is courtesy of an excellent salary guide that the people at Team up put together that you can grab for the low low price of going down to my show notes and clicking and getting it. Salary range for Filipino bookkeepers If they have one to three years US experience that is like working with US or Western companies. Usually going to pay them between 1100 and 1400 USD per month. Three to five years experience, you're looking at 1400 to $1700 USD five plus years 1700 to $2000 USD per month. Here's a profile of actually someone that team up recently placed with a firm. Got a Bachelor's in accounting. They're a quote certified bookkeeper and registered Cost accountant. I know what that is. Both QBO and Xero certified. Six years of experience in the accounting field. Three years experience with a US accounting firm serving 60 clients from manufacturing, e commerce and merchandising industries. Oh those are yucky ones. Proficient in QBO and desktop, multi threat and they were looking for 1500 bucks a month. Gang, I've told you before, the last four hires I made were in the Philippines. Really good. Maybe I got lucky, I don't know. You want to explore doing the same or just want to learn more? Check out that salary guide that Team up made. I'll link that down in the show notes. This episode is sponsored in part by Kleinhub Kleinhub, who turns your firm's busy seasons into wow seasons. Because those seasons, they're an opportunity to wow the ever loving off of your clients. Wait just one minute Scooter. You can't say that in an ad read. I'm sorry K. I get excited. Client Hub is gonna wow your clients right off their socks because it is a game changing client experience. Simple, intuitive, easy to use, doesn't require Ph.D. and goodness gracious, this practice management system's complex. It's not some like herky jerky bolted on client portal that has like three options on the left hand side and each one you select it looks like, I don't know, something some junior developer just made in like 25 minutes. Because let's be real, that's what a lot of client portals still look like. Can you get back to the bullet points here? Okay, One of the reasons people love Client Hub is clients. Clients just become users. Like the design is so good. They're like oh I get this, it's kind of just like a two sided task management system. Client hops in, looks like the other tools that they use, they can see their tasks, their files, their financials. It's not hard mobile friendly, so they can do it on the road too. But it's intuitive, doesn't really require training. And they're going to be like, oh, you're like a cool modern firm, not like that last firm that I used where I logged into this thing and I'm like, Henry viii, is that you? You know what I mean. To learn more about Client Hub, check out the link down in the show notes. Somewhat related number three. Consider a client concierge. That is a person that is in charge of following up with clients if there's documents missing, if they have questions. The concierge job basically is to serve as a buffer for your technical staff so that they're not sitting there right randomly getting emails or randomly getting phone calls. The more like focused work time your professionals have, the more they're going to get out the door. And a client concierge is a good way to sort of buffer them from that. Again, the goal here is if we're staring down the barrel of needing to hire this unicorn, the better version of that unicorn is getting more out of the people that you already have. Like that's a much, much more efficient version than having to go hire a new unicorn and train them from scratch. Sometimes that's going to be necessary, but let's make sure that we've got everything that we can out of the people that we already have. Number four, software eyes. I know that's not a word. A lot of this stuff can simply be done by software. So chasing clients for documents like, that's just, that's just requests that can be set up in our practice management system. Tax intake tools are another great example here of an opportunity to do with software what once required human beings chasing clients around with a, with a tax organizer saying, no, you still need to get me X, Y and Z. We, we now have tools that will do this on a totally automated basis using actual pro forma data from the prior year return. I outlined my favorites for this in the app database that we released last week. We can put a link to that down in the show notes. Grab that totally free. You get my short list of tax workflow tools that I recommend. I know sometimes we grapple with maybe the cost of software and we're like, oh, I realized I could hire somebody to do that thing for the same cost as the software Humans will always be better than software because they're much more flexible and adaptable and can do more things, whereas software, they just do the things that the software is designed to do. But all else being equal, in my experience, you will not regret buying the software. And most of the time it's not an either or proposition. You will buy the software and then very quickly you'll be like, oh, I actually need that human too. The lovely thing about software is when you're like looking at change and new processes, software doesn't create inertia for your firm in the same way that humans do. A 20 person firm has more than double the inertia of a 10 person firm. Like there's this like exponential logarithmic thing where the more people you have, the harder it is to change directions. This is where software can help because software can make a real difference on the headcount that's required to get something done. Two more things to do before hiring that unicorn. And then if you do have to do the unicorn thing. Couple ideas there. Fifth thing to do, consider why you're trying to do more. I touched on this a bit at the top, but oftentimes we'll make another hire to avoid having had some, some hard conversations with, with clients or with staff who like have this pet project and you're like, bro, that's just not pan and out. Can I actually pull you back over here? Consider what it would look like not to make that hire. What are the things in the business that you would trim? Because that's like almost always the better thing to do. Most firms have so much fat hanging off of them, as evidenced by you going to bed and thinking, what if I just cut the client list in half and cut the staff roster in half, Wouldn't my job and Life be like 90% better? Honestly, for most firms, the answer to that is yes. But we don't do it because we're scared to make that really hard decision. But that's a sign that like, there's too much fat. So rather than making that next hire, the better move is probably to reduce and get more focused in what you're doing, which probably looks like number six here, trimming the bottom of the client list. I don't wanna have to go out and hire a unicorn, like top level, really expensive people just to continue servicing my D clients that I'm afraid to get rid of that I probably don't even make any money on anymore. So if you're not sure where to start with like what clients do I get rid of. This is where three tier proposals help a ton. I put a three tier proposal in front of client A and client B. And on the other side of that, I immediately know what each of their appetite and ability to pay is. Whereas if I give every single one of my clients a single price and they all pay the same thing, I will have clients that complain that that's too much, but I won't hear anything from the clients that happily would have paid twice as much. And that's the value of a three tier proposal. As I learn who has a willingness to pay more. In a way, it is your clients self selecting their willingness and ability to pay. Not that this is the only factor in deciding what clients you're going to get rid of, but it's a pretty big one, right? So six things to do there or at least consider before, like getting mad that you can't find that unicorn. 1 systematize 2D skill 3 consider a client concierge 4 software eyes 5 consider why you're trying to do more. And then 6 consider if you're better off actually trimming the bottom of the client list to run a more lean firm. Now let's say you absolutely have to find that higher. You need more bodies. Somehow something has to give. I found myself here as well. I was like, I want to do more, I want to grow. But we're putting job listings out and it's just not happening for whatever reason. The reality is like when you're just beating your head against the wall and that thing is not happening, something has to change. Like you have to break some assumption that you hold about how do I get unstuck from where I'm at right now? Because there's, I mean there's firms with tens of thousands of people. Like, this is not a problem for everybody. There are solutions. Our problem is we haven't learned the solution to this problem yet or we have a collection of beliefs that have to somehow be broken in order to overcome that thing that we're stuck on. Right? And the two biggest ones that I see that are especially big with, with smaller firms. And I'm saying this as me, a small firm runner, two biggest things I see being afraid to hire a recruiter and being afraid to either hire offshore or outsource and both of those things. Maybe there's a world where those things wouldn't need to exist, but right now they do. And there's a reason they do exist and there's a reason that people do them. There's a reason that recruiters are a thing. And while you can probably do better than Robert half, it still is going to feel like, gosh, goodness sakes, this is expensive. And that's why we don't do it right. We're like, I can't imagine cutting a check for 50 grand to find that right person. That just blows my mind. But what we're not considering is the cost of not having that person. Right? That's so easy to do, look at the cost of something and you're like, I'm never going to pay that. While we don't stop to consider, like, what's the price that we're paying for it right now? And that's why people will pay those rates. I've paid for recruiters before. I didn't love it. And it's not the first option. Like, to be clear, like, this is always the fallback. Like, personal relationships that hire you can find organically. I mean, there's a hundred better ways to do it than a recruiter, but if that's where you're at, that's where you're at. And like, it may also force you back to those six things that we just talked about. Like, it is one more argument for not making that hire, perhaps. And then last, outsourcing or doing offshore. Um, I've never been as big of an outsourcing guy as I am an offshoring guy. So outsourcing is hiring another company to do some of your work for you. So you're paying for outcomes, you're. You're paying for tax returns, pay for month end close, as opposed to hiring offshore. And there are, there are also offshore outsourcing options. What I did was hire people who are offshore, which are much, much easier to find. I can like snap my fingers and in 30 days know I'm going to have a pretty good person that can help me out. Whereas doing that stateside is like nigh on impossible. So what I did was like, all I did was was worked with people directly offshore. They were, they were my team members, just like any of our team members onshore. And a lot of us, a lot of folks still still struggle with that. They don't like the idea of it. They think that it is gutting kind of the future leadership of the firm sort of thing. But, like, this doesn't need to be like, torpedoing the future of your firm and hiring offshore. Like, you can develop onshore talent while you develop offshore talent. Like, those two things are not mutually exclusive. So, yes, you should be developing onshore talent. Doesn't mean you can't use offshore. I don't need to tell you this. You get served enough ad reads of me talking about offshore recruiting groups. Right? But it's to me, it's an example of an assumption where like there was a day, in fact most of my career I was like, why in the world would I ever hire anybody offshore? My clients are going to freak out. What about the disclosures? I'm never going to do that. Until one day like I. There was a firm owner that I super looked up to and I found out like, oh, she, she outsources. And I like that just that didn't jive with my model of well, this is a really smart, progressive firm. But they're doing that, like, what do I not know? And I literally took that back to my partners at an 80 year old firm and you better believe the reaction was exactly what you'd expect. And in my case, like, it required breaking that assumption. And that's something that I'm super glad that I did and like totally changed our approach to hiring. Whether you still need that unicorn or not, these are all things that are worth doing. How systematized you are, how much you've de skilled the work in your firm. Firms operate like there are firms that are crushing that right now. And then there's firms where you have folks that you got to pay 150 grand a year to do a thing that in another firm an admin is doing. And oftentimes it requires challenging assumptions of like what's possible and what can be delegated. And I challenge you to see if you're able to scooch just a bit down that path to becoming a more systematized firm so you're not deploying like the limited time of your most scarce people, yourself included, on tasks that somebody else can do. Any wisdom you got, Drop that stuff down in the comments. Hiring's hard. People are hard. Thanks for coming and hanging. I'll see you in the next one.