The question no one is asking about business advisory

The ‘trusted adviser’ – it’s a phrase all accountants in public practice are familiar with. But what does it mean?

by | 31 Jan, 2017

The question no one is asking about business advisory

Whenever you go to a professional development seminar, attend a webinar or read a blog advising the profession, there’s a good chance the presenter or writer will tell you that you are the natural trusted adviser. I mean, who else is there? Lawyers? Bank managers? Insurance brokers? It has to be us, right? That is why we are well-placed to move into business advisory services.

Well, yes, but I have a question for you, and I believe it’s the question no one is asking. What does that actually mean? And specifically, what does it mean from the perspective of your client?

I often talk about the bridge from compliance to reliance. Think of any client for whom you’ve traditionally only done tax or accounting services – a standard compliance client. Then imagine you are sitting face-to-face with that client and out of your mouth comes the words, “We specialise in business advisory and we can help you grow your business”. How do you think the client might respond?

When I ask this question in seminars, the typical responses I hear are that the client might be sceptical. Some accountants tell me they fear the client might ask, “What do you know about running a business, much less growing it?” And there’s the problem. To move into a position where you are truly the natural trusted adviser, offering valuable advisory services to clients, I believe you need to stay very close to the numbers. Doing so will help you cross that bridge.

For example, start by bolting on a simple three-year business performance review to the annual financial statements and talking the client through what has happened in their business. Then, when you ask the question, “What would you like it to look like in three years’ time?” the client has some context. You are guiding them slowly over the bridge.

Language is critically important as you make the move into advisory. Let’s consider a simple example. Think of a question you’re often asked, “What do you do for a crust?” If you respond as most accountants do with the words “I’m an accountant”, don’t be surprised when the other person excuses himself or herself to go and talk to someone else. I know, that sounds cruel, but we are fighting a stereotype of a staid, boring profession that charges people for services they don’t really want. And that’s the nub of why the move into advisory is not as simple as it is often made out to be.

Changing your language will at least get you into a conversation. Imagine the same question (“What do you do for a crust?”) with a different response. Imagine this time you respond as follows:

“We help our small business clients build great businesses.”

Confronted with that answer, you would have to think that at least some of the time, the other person might respond, “That sounds interesting. How do you do that?” And then you are in that conversation that can guide you and the client towards an understanding of how you might work together.

However, as you might infer from my comment above, that is part of the solution, not the whole solution. The real question that no one is asking (or at least answering) is what are the new skills an accountant needs to acquire to succeed in the advisory space? To discover the answer, let’s think about the skills you mostly have as a result of your training as an accountant:

  • Analytical skills
  • Problem-solving skills
  • Technical knowledge
  • Tax expertise
  • Relationship management (tends to happen as you take on a client base, rather than something that is trained.)

For the most part, these are the skills of the expert. As an accountant, you are trained to know the answer and to give the client the answer. These are all very valuable skills but not necessarily the skills required to build expertise in business advisory.

There are three core areas in which I would suggest you need to develop core competency to succeed as a business adviser. They are:

  1. Marketing
  2. Selling
  3. Delivery

Starting with marketing, don’t expect clients to come to you asking for help to grow their business. You need to go to them and make them aware. Again, start with the numbers. The business performance review I mentioned is a great entrée. Set some targets for the next 12 months with the client and keep an eye on how they are travelling relative to the targets. Call them periodically with relevant, real time advice. If you do this with just 10 clients, it’s a fair bet that at least one will start working with you in a new way. You can then leverage your success with that client into others.

With sales, the key skill to acquire is asking more questions. Stop giving the answer. Be inquisitive. Relentlessly pursue a knowledge of your clients’ goals and objectives. Be genuinely curious. And be prepared to offer your help.

Which leads to delivery. The biggest fear I observe in accountants is the fear of success. What if the client says yes? What do I do then? That’s when you need to have what I call your core stable of services to offer as a solution. You need a decent working knowledge of what you would do and ideally, you’ll have systems and protocols that you can roll out. But remember, you’re striving for success, not perfection so a decent working knowledge really is good enough. You’ll figure out the details when you get into it with the client.

There is no silver bullet to becoming successful in advisory. It takes work. It takes a commitment to change. It requires accepting that this could take you two or three years before you can say you’re really comfortable. It could also mean that you need to create some capacity to enable you to grow into your new role. Do you have clients you don’t like? Maybe they need to go to free up time.

As an example of a commitment to change, one of our members in the United States recently made a commitment to clients that they would provide a business performance review with the year-end accounts. But rather than the partner fumbling his way through, he and three of his senior accountants completed a business advisory course to develop new skills.

They are now confident they can take that first step towards being the true natural trusted adviser. And so can you, if you really want it.

By Colin Dunn, director, PANALITIX Pty Ltd.  

 

 

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