How to Turn a Gerbil Into an Owl

Transcription

1 How to Turn a Gerbil Into an Owl Help free your clients from redundant, fruitless tasks so they can focus on the big picture and make better decisions for their business.

2 How to Turn a Gerbil Into an Owl Help free your clients from redundant, fruitless tasks so they can focus on the big picture and make better decisions for their business. Are you training your clients to be gerbils or owls? Not all clients are created equal. Some rely on you for tax compilation services, and that s it. Others may rely on you for these services, but also look to you for strategic planning advice. Most consultants prefer the latter. But does that mean you should ditch certain clients in favor of others? No! You just need to learn how to help your tax return clients become big picture clients. And that s where gerbils and owls come in. Consider the lowly gerbil. He s at the bottom of the food chain. He spends his time in constant activity but rarely goes anywhere. What s worse, the domesticated ones spend much of their life in a cage. If gerbils can verbalize at all, their questions typically concern the how and the what. Sound familiar? These are the people in every company who are focused on how to balance journal entries and determining which account to debit. They might be driving lots of revenue-related activities, with no concern for the profitability resulting from the sales. They might even be driving revenues and generating positive operating income, but have no ability to collect money from their customers. Eye-opener: If a gerbil hires you for help, he is going to want a tax return that gets filed on time, and a financial statement in a nice binder. Compare him to the wise owl. Owls soar high above the earth, seeing information from a different perspective. Owls look for new ways to conduct business. They seek alternative ways to grow and profit, and are willing to pay for expertise. They are more concerned with the outcome than the activities that support it, and they can glean insight quickly from a few pieces of information. These are the kinds of questions owl clients might be interested in: Who is my target market? Who are my Top 10 Customers? Who are my best suppliers? Who are the right people to have working in this company? Eye-opener: If an owl hires you for help, they are going to want to meet all regulatory requirements, but is going to be interested in services you can provide that help them out-perform their competition. 2

3 Gerbil facts and figures Hobbies: Hoarding food Habitat: Burrows and cages, where it s safe Mode of transportation: Running in circles Party trick: Can multiply easily bears up to 15 litters in a lifetime Bragging rights: Odorless and gentle 4 ways to identify the species of your clients. 1. Check their accounting software. Gerbil clients are often shortsighted in their choice of accounting software. They may believe pen and paper, or shoebox accounting, is better for their untrained staff. Unfortunately, this kind of solution may lack the proper financial controls and invite just the kind of errors non-accountants would be likely to make. For example, someone might write a check without indicating a corresponding expense. These clients probably don t understand accounting or its relevance to successful business outcomes. Owl clients understand that a double-entry accounting solution can be just as easy to use, while offering better checks and balances. Eye-opener: It is difficult if not impossible for someone to value a service they do not understand. It is your job as a professional to educate your clients on the basics of accounting in a way that makes it relevant. Otherwise, you might want to consider different clients. 2. Observe their reporting habits. What kind of reports is the client running from their accounting software? How often do they check their business results? What information do they review daily? What do they review weekly? And what is important only once a month? Gerbil clients might only run financial statements once a year, as part of their tax-preparation procedures. They might not understand the value of the information in their statements. These clients tend to check book balances. They spend the money they make as quickly as possible. They want to keep improving that cage since they spend so much time there! Owl clients look at profitability, cash flow, and margins by customer. They look at inventory turns striving to minimize inventory on hand while improving their ability to meet customer demands for product. They have invested in e-commerce. They send invoices electronically and are using or considering using an Electronic Data Interchange (EDI) solution. Eye-opener: Here s a great opportunity for you to turn gerbils into owls: offer a basics of accounting class once a month and invite all your clients. They ll learn how to understand financial information in a way that s relevant to them and you ll add value to your services. 3

4 3. Study their behavior. Gerbils and owls spend their time differently. Gerbil clients spend most of their time at the transaction level, where speed and accuracy are of greatest importance. Their activities include: Building spreadsheets Entering recurring transactions Tracing details to source Monitoring exceptions Building budgets and collecting input manually Reconciling bank statements Handling paper documents Creating and distributing reports Dealing with unprofitable clients Collecting past due accounts Answering Manually tracking assets Filing sales tax returns Owl clients focus on activities that lead to gaining insight and taking strategic action. This is where that ability to look up, down, and all around helps. They analyze past results and keep an eye on real-time information all while staying focused on future goals. Gerbil clients spend the majority of their time on transactions, where volume, accuracy, and speed are important. An accounting system can help them work smarter and faster so they can move up to more profitable and strategic owl activities like customer management and analytics. 4

5 4. Note their ability to assess, analyze, and act. How has the client s business changed over the years? Does the client spot trends and adapt accordingly, or watch sales results decline year after year with no changes in business strategies? And, as the client s advisor, are you providing year-over-year trend analysis so the client can see the warning signs? Or are you helping the client remain a gerbil confined to the same cage, spinning the same wheels? What sorts of analytical tools is the client using? You can help gerbil clients become owls by designing reports that provide more meaningful information and can be run in their own systems. Eye-opener: Accountants, bookkeepers and their owl clients benefit from using an accounting solution that includes reporting tools like FRx, F9, Sage Intelligence, and Crystal Reports. These tools allow you to create standard reports that you can share with all of your clients to help them analyze results and take action. How to Speak Owl Language Owl clients are always looking for ways to turn information into wisdom. They will value any services you provide that can help them have better insight. They often speak in questions, so be prepared to provide answers. Even better, bring your own questions to the table for an open dialogue. Common owl questions to prepare for include: What new insights can you share with me? What are my problem areas? What suggestions do you have for improving business results? What would happen if I added a new division in the next year? What happens if I lose my top customer? How should I determine compensation for my salespeople? 5

6 Help gerbils become owls in 3 steps. Step 1: Automate You can t take away all those transactions gerbils are responsible for, but you can make them easier and faster to process all while improving accuracy. The benefit, of course, is less wheel-spinning and more time for thoughtful analysis of the results. Most accounting or ERP systems automate common accounting tasks. The key here is finding a solution that s designed to work the way your client works. The best solutions feature intuitive, graphical user interfaces and provide for easy user-level customization, allowing the user to set up their screens for quick access to the tasks they do most. A good solution also provides tools for importing and exporting data. Some use ODBC connections, others provide native routines that quickly put data in a workable Microsoft Excel spreadsheet. But don t let your clients become spreadsheet junkies! Gerbil cages across America are littered with the remains of spreadsheets that don t reconcile to the financial statements. The best accounting solutions provide robust native reporting capabilities, inquiry screens, and even dashboards. Advise your clients to use these as much as possible in order to stay on top of their cash position and daily changes in critical business results. Here are some key features your clients should look for in an automated solution: Import/Export routines Alerts Inquiry screens and drill-downs Dashboards Integrated sales tax solutions Collection tools Payroll tax automation Scalability 6

7 Wise Owls Centralize Customer Management Consider the single most valuable off-balance sheet asset that any client has. It s their customer list. If you are not educating your clients about the benefits of a centralized Customer Resource Management solution, you are missing an opportunity. Help them make the most of every customer interaction, track their marketing campaigns (so they can assign a gerbil to do some detailed analysis of costs versus benefit), and learn more about their customers and their buying habits. Do your clients know what their typical sales cycle looks like? With CRM, wise owls can have better visibility into their sales cycle so they can make it more predictable and improve their ability to budget next year. Step 2: Integrate Does your client have a roomful of gerbils running around trying to find information in four or five different applications? Are the boundaries of their cages keeping them from leveraging each other s information? You can help them solve this problem by recommending they integrate their front-office and back-office systems. The best way for your client to integrate their departments is to find a software solution that offers complete end-to-end capabilities. With an end-to-end solution, your clients can: Gain better visibility into every aspect of their business Eliminate duplicate data entry between departments Improve customer service by empowering staff with better access to information Facilitate inter-departmental communication Make time-critical decisions faster 7

8 Step 3: Communicate No matter how interesting that detailed analysis of the number of seeds in a package by weight and serial number might seem to a gerbil, he needs to know how to relate this information to his audience in a way that s compelling and engaging. This is where you as his external consultant can unlock the doors of his cage. Share these communication tips with your gerbil clients, and you ll not only help them become owls, you ll help them become lifelong clients. Make the information relevant to your audience. If seeds are the issue and the audience is sales people, help your client show the sales team a nice map with the number of seed packages sold by state in the last year. Sales people want visual information; don t show them a spreadsheet with tiny little numbers in nice rows and columns. On the other hand, if your audience is the engineering team you might want to present information in a flow chart. Always keep the audience s perspective in mind. Put it in context. Take the number 60. Is that a good or bad number? Well, it depends on the context. If 60 is a score on your son s final exam, better brace yourself for summer school. If it s the final score in his basketball game and the opponent has scored 58, you ve got a reason to celebrate. Often, we present financial statements with no context. How do our results compare to last year? How did we do compared to others in our industry? Did we do better this quarter than any other year in our history? Point out key data that helps everyone evaluate the meaning behind the numbers. Keep it high-level. As accounting consultants we work with lots of details. But our audience is often a CEO or business owner (one of those owltypes) who has only five minutes to spend looking at your report. It is our job to find a way to concisely identify the top four or five things that the CEO needs to monitor and bring those to his attention. After all, gerbils who can think and communicate like owls may just find themselves becoming owls themselves one day. 8

9 Additional resources for you. The Sage Accountants Network provides accounting professionals with resources that can help them better manage their practice and serve their clients. For a nominal annual fee, members receive access to one or more Sage product libraries, together with support and automatic upgrades for the particular products that may interest their clients. Your firm will also be listed on the Sage Accountants Network Online Member Locator for extra exposure for firms that support Sage Products. Please contact us to learn more: CALL SimplyAccountingPartners@Sage.com Sage Wireless Way Richmond, BC V6V 0A Sage Software, Inc. All rights reserved. Sage, the Sage logos and the Sage product and service names mentioned herein are registered trademarks or trademarks of Sage Software, Inc., or its affiliated entities. Business Objects and the Business Objects logo, Business Objects and Crystal Reports are trademarks or registered trademarks of Business Objects Software Ltd. in the United States and/or other countries. All other trademarks are the property of their respective owners /08