Monday, October 21st, 2019

Top Heavy

“The secret of getting ahead is getting started.” – Mark Twain

When it comes to MAP (Managing an Accounting Firm), one of the many things CPAs have focused on over the years is leverage. Leverage and a well-managed pyramid are key ingredients for a profitable CPA firm.

We have been talking about it for years….. Bill Reeb calls it the Upside Down Pyramid. It’s where partners work and work until they are “full” and then they push down to managers who work and work until they are “full” and only then do they push down to the staff. Meanwhile, staff members are sending emails asking for assignments!

upsidedownMany firms have evolved into a top-heavy culture because:

  • Generational issues, including the Baby Boomer bubble, Gen Xers and Millennials.
  • Lack of a firm-wide people plan with effective, consistent recruiting and staff development processes. Leaders don’t have a process to see enough new faces and they let people hang around too long.
  • Promoting non-partner-track people or sometimes marginal folks to higher positions because “We’re preserving staff continuity” and “it’s best for the client” – – when perhaps it is just the path of least resistance, or you have no one else to fill the role.
  • Partner compensation plans that focus on chargeable time. Partners stay busy first. Managers are doing staff work and no one has an incentive to push work down.
  • It’s just easier to do it myself and, besides, I’m a lot more efficient at it.

Do these sound familiar to you?

  • "What counts is not necessarily the size of the dog in the fight - it's the size of the fight in the dog."
  • Dwight D. Eisenhower

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