BECOMING A TRUSTED BUSINESS ADVISOR : how to add value, improve client loyalty, and increase... profits

396 Pages·2016·3.55 MB·English

by  REEB

How to Add Value,
Improve Client Loyalty,
and Increase Profits
by William L. Reeb, CPA, CITP and
Dominic Cingoranelli, CPA, CMC
10637-359
Notice to Readers
Becoming a Trusted Business Advisor: How to Add Value, Improve Client Loyalty, and Increase
Profits does not represent an official position of the American Institute of Certified Public
Accountants, and it is distributed with the understanding that the author and publisher are
not rendering, legal, accounting, or other professional services in the publication. If legal
advice or other expert assistance is required, the services of a competent professional should
be sought.
Copyright © 2010 by
American Institute of Certified Public Accountants, Inc.
New York, NY 10036-8775
All rights reserved. For information about the procedure for requesting permission to make copies of any
part of this work, please visit www.copyright.com or call [phone].
1 2 3 4 5 6 7 8 9 0 CS 1 9 8 7 6 5 4 3 2 1 0
ISBN: 978-0-87051-902-4
Acquisitions Editors: Martin Censor, Erin Valentine
Developmental Editor: David Cohen
Project Manager: M. Donovan Scott
Book Design: Tom Caley and David McCradden
About the Authors
William L. Reeb, CPA, CITP
Bill has been consulting for three decades to all sizes of businesses, from Mom and Pop op-
erations to Fortune 100 companies, primarily in the areas of organization, automation, and
revenue generation. He decided to add the credentials of CPA behind his advisory work and
became a CPA in 1986. Prior to his life as a CPA, he worked in sales for IBM back in the
late 70’s. As an entrepreneur, Bill has founded eight small businesses in the retail, software
development, and services sectors, including his recently launched consulting firm, Succes-
sion Institute, LLC.
As an award-winning public speaker, Bill lectures throughout the United States and Can-
ada to thousands of executives and CPAs each year. In addition, he has been featured on
numerous video-taped and live television programs. As an award-winning author, Bill is
published internationally with hundreds of articles and columns to his credit. He currently
authors a bimonthly column called “In the Bill-iverse,” which, at the time of this printing,
is distributed by 15 state CPA societies as part of their practice management e-newsletter.
Besides being published by various magazines, journals, and newspapers, this book is the
fourth edition of books Bill has written on delivering advisory and consulting services. The
third edition was called Start Consulting: How to Walk the Talk, published by AICPA in the
United States and by the Certified General Accountants (CGA) in Canada. Bill has another
new book published in 2010 on Succession, Securing the Future: Taking Succession to the
Next Level, which is a sequel to his first book, Securing the Future: Building a Succession Plan for
Your Firm, which was originally published in July of 2005 by the AICPA Private Companies
Practice Section (PCPS). Finally, Bill coauthored the Succession Resource Center Web site
materials for PCPS in 2009.
Bill is an active volunteer within his profession and has served in many leadership roles in
the AICPA including current member of its Board of Directors, and a current commissioner
of the National Accreditation Commission. He also has served in numerous other roles in-
cluding as a member of the AICPA Council several times, a member of Strategic Planning,
and chair of the Consulting Services Committees. On a local level, Bill has been a member
of the Executive Board, Strategic Planning, and has chaired several technology commit-
tees for the Texas Society of CPAs. Additionally, he has been honored by being named as
a CPA ambassador, was presented the Pathfinder Award, and has served as the Texas Vision
Delegate. Accounting Today has recognized his efforts by listing him as one of the Top 100
Most Influential CPAs, CPA Magazine has named him as one of the Top 100 Most Influential
Practitioners, and Inside Public Accounting listed him several times as one of the most recom-
mended CPA firm consultants, and has recognized him as one of the Top 10 most recom-
mended CPA firm consultants in 2008.
iii
About the Authors
Do minic Cingoranelli, CPA, CMC
Dom has been consulting for three decades to a variety of organizations, from professional
services firms to nonprofits, construction companies, and Fortune 500 companies. He has
been a CPA for thirty-five years and started his own firm in 1976. He ran an office of a
local CPA firm located in a rural area of Colorado until 2008 when he joined Bill Reeb to
create the Succession Institute, LLC. During his career in public accounting, Dom had the
privilege of working with a variety of small and midsize business owners, and he truly lived
the role of most trusted business advisor in his interactions with these clients. His work also
includes assisting project managers with partnering and conflict resolution on large, complex
construction projects of over $300 million. In addition to being a CPA, Dom is a Certified
Management Consultant, and he earned his MBA with honors from Regis University.
He speaks frequently on management and consulting topics and has made presentations at
AICPA conferences, state societies of CPAs and CPA firm association conferences, as well
as the Annual Conference of the Institute of Management Consultants—USA (IMC-USA).
Dom has created continuing professional education (CPE) offerings on matters ranging
from strategic planning to partnering on construction projects, to professional firm practice
management and a background primer for CPAs on the business issues of the construction
industry. In addition to his CPE courses, Dom has been published in the Journal of Ac-
countancy, The CPA Journal, The Practicing CPA, CPA Insider, CPA Management Consultant,
Constructor, Broker, and other state, regional, and national media. Many of his position papers
can be downloaded from the Succession Institute Web site at www.successioninstitute.com.
Dom has been quoted in the Dow Jones Wealth Manager, CPA Insider, the Journal of Accountan-
cy, and the Construction Company Strategist, and he has participated in national webcasts of the
Institute of Management and Administration and the AICPA on CPA firm management
and succession planning. Besides coauthoring the revisions to this book, Dom coauthored
another new book a on succession management, Securing the Future: Taking Succession to
the Next Level. He also coauthored the Succession Resource Center Web site materials for
PCPS in 2008 and the PCPS Trusted Business Advisor Web site in 2009.
Dom has served in a variety of leadership positions for nonprofit and professional organi-
zations. He chaired the Management Consulting Services Committee for the Colorado So-
ciety of CPAs and served on a variety of AICPA committees, with his most recent position
being that of chair of the Consulting Services Executive Committee. He also has assisted as
a panel member for interviews of candidates for the CMC designation at the IMC-USA.
Outside of accounting, Dom has been active in the heavy construction industry, having
received the Associate Member of the Year Award in 2007 from the Colorado Contractors
Association. He is a past chair of the Associate Member Council (Board of Directors) and
member of the Contractor Board of Directors of the Colorado Contractors Association.
iv
Acknowledgments
We would like to thank our partner, Michaelle Cameron, PhD, who helped us think
through and organize this information. She offered significant insight throughout the ma-
terials, which we believe made a significant impact in the final manuscript. And, as you see
in the technical acknowledgments, Michaelle was the contributing author for the marketing
material as well.
We would also like to thank the AICPA publications team who helped fine-tune this
book, particularly Martin Censor, David Cohen, and Erin Valentine. Their common-sense
approach to editing made what can often become a tedious, time-consuming process a true
pleasure.
Finally, we wish to thank Mark Koziel and the Private Companies Practice Section. Their
support of the Most Trusted Business Advisor concept has been invaluable.
Technical Acknowledgments
We would like to thank:
• Larry McGinnes, Senior Associate, Communispond, Inc., for his assistance in the area
of presentation skills.
• Michaelle Cameron, Ph.D., Associate Professor of Marketing, Saint Edward’s Univer-
sity, Austin, Texas, for guidance throughout the book and as a contributing author for
chapters 11 and 12.
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Contents
Section 1: The CPA as Most Trusted Our Answers to the Questions and
Business Advisor Objections ......................................41
Fees and Pricing Issues ................41
Chapter 1: Becoming Your Clients’
Positioning Issues ........................42
Most Trusted Business
Workload Issues ..........................42
Advisor ..................................................2
Addressing These Issues ......................45
Overview .............................................3
Compensation Systems ...............45
Frequently Asked Questions About
Clients and Fees ..........................45
the MTBA Role ..............................4
Stop Giving Away Work ..............48
Organization of This Text .....................9
Technology .................................49
It’s Time .............................................11
Managerial Leadership ................49
The General Contractor
Chapter 2: The Changing
Model .....................................50
Profession ............................................12
More on the Opportunities of an
The World Continues to Change ........13
MTBA ...........................................51
The Profession Is Continuing to Be
Revenue Growth ........................51
Reshaped .......................................13
Account Control ........................54
The Commoditization of
The MTBA Framework Is a
Traditional Services .................15
Logical Role for CPAs ............55
Unbundling Services ...................17
The Market Has Changed ...........55
Moving to the Future .................18
Organizational Opportunities ......56
The AICPA’s Position on Advisory
To Answer the Question .............57
and Consulting Services..................19
What About Attest Clients? .........21
Chapter 4: The General Contractor
Incorporating the MTBA
Model ...................................................59
Framework Into Your Daily
Using the General Contractor
Routine ..................................22
Model ............................................60
Who Should Become an
The Role of MTBA ...................60
MTBA? ..................................23
The General Contractor Role ............61
The Minimum Transition
GC Case Study ...........................61
Requirement for Moving to
Skills Required for the GC
MTBA Status ..........................38
Role .......................................63
Will People Pay Me to Function
Chapter 3: Making the Transition to
as a GC?..................................64
Most Trusted Business Advisor: How
Case Study ..................................65
and Why ...............................................39
Important Nuances of the GC
The Essence of the Most Trusted
Approach .......................................66
Business Advisor Framework ...........40
Being a GC Means More Than
Obstacles or Opportunities .................40
Just Referring Someone ..........66
vi
Contents
Bill for Your Time .......................67 Ask Open-Ended Questions .....101
Build Your Subcontractor Probing and Follow-Up
Network .................................67 Questions ..............................103
Benefits of a Strong Subcontractor Don’t Forget to Use the Global
Network .................................68 Functions as Your Questioning
Your True Value as MTBA Checklist ......................................104
and GC ...................................68 Avoid the Impulse to Announce
Your Need to Stay Involved as Quick Solutions ...........................109
MTBA and GC .......................68 Your Job Isn’t to Have Answers .........111
Your Role as GC in Dealing Listen Actively ..................................113
With Subcontractors ...............68 Clarification and Paraphrasing for
Final Thoughts on the GC Model ......69 Understanding ..............................117
Does Gender Make a Difference? .....117
In Conclusion ..................................118
Section 2: The MTBA Framework
Before You Move On .......................118
Chapter 5: Developing Your Self
Chapter 7: Advanced Communication
Skills .....................................................72
Skills: Working as a Facilitative
Treating the Symptoms ......................73
Advisor Instead of as a Technical
What is Your Emotional I.Q.? .............74
Expert ................................................130
Taking Down the Barriers ..................76
Show Me the Money!—
Self-Esteem: The Greatest Obstruction
Quantification ..............................131
to More Effective Communication ..77
The Omnipotent Advisor: A
Communicating With Your
Relationship You Can’t Count on
Friends ...........................................78
Having as Well as a Risk You Can’t
Self-Esteem: Awareness Goes a Long
Afford ..........................................134
Way ................................................80
If This Is So Straightforward, Then Why
Failure: A Sign of Real Growth ..........81
the Opposition? ............................136
Your Attitude Makes a Big
Perspective is the Key .......................137
Difference ......................................84
Different Approaches Are Necessary for
Recapping Some Potentially
the Advisory (MTBA) and Expert
New Ideas ......................................86
Advice Roles ................................138
Before You Move On .........................87
The Hierarchy of Sources .................140
Chapter 6: Refining the Before You Move On .......................142
Most Important MTBA Tool:
Chapter 8: Delivering Value-Added
Communications ................................89
Services ..............................................146
Communication Foundation ..............92
Cash, Capacity, and Capability ..........147
Making a Good First Impression ........92
The Balancing Act............................151
Interpreting Nonverbal Messages ........93
How Do You Find the Right
Ask Questions ....................................99
Balance? .......................................152
Take Notes and Refer to Them
A Simple Format ..............................153
Often ......................................99
What If the Client Doesn’t Want to
Ask Only One Question at a
Do the Leg Work! .........................154
Time .....................................101
vii
Contents
The End Result ...............................154 Time and Charges Approach .....224
Estimating the Project: Pricing Project Billing Approach ...........228
Approaches ...................................154 Value Billing Approach..............229
Commissions and Contingent Fees: Frequency of Billing .........................231
Where Do They Fit in?.................160 Survey Information You Might Find
Before We Move On ........................161 Interesting in This Context ...........232
Gaining an Edge on Being Paid for Your
Chapter 9: Advanced Advisory
Involvement .................................236
Skills and Practices: Conducting
The Value of Advisory Fees Is More
Effective Sales Calls With Clients
Subjective .............................237
and Prospects ....................................167
Sometimes When Senior
Where We’ve Come From ................168
Management Asks You What
Going Even Further .........................168
the Problem Is, You Have to Tell
The Structured Discovery Call ..169
Them That They Are the
The Structured Sales Call ..........169
Problem ................................238
The Structured Consulting or
Project Deadlines Are Internally
Advisory Call ........................169
Generated .............................238
Uncovering Relevant Information ...170
Client Commitment Is
The Structured Discovery Call ..173
Imperative .............................238
The Sales Process .............................180
Retainers Aren’t a Panacea ................239
Feature, Benefit, Result .............181
Asking for a Retainer ................240
The Structured Sales Call ..........182
How Much Retainer Should
The Closing Phase of the Sales
You Ask for? ..........................242
Call .......................................191
Summary Regarding
Service Delivery ...............................199
Retainers ..............................242
The Structured Consulting or
Proposals ..........................................243
Advisory Call ........................199
Typical Proposal Structure .........245
The Number One Failing ................206
Attachments..............................248
Before We Move On ........................207
Engagement Letters ..........................248
The Discovery Call Role Play ...207
Paper Closing Exercise ..............209
Section 4: Identifying and
Sales Call (Information Gathering
Marketing Your Services
or Branch) Exercise ...............209
Self-Assessment .........................210
Chapter 11: Two Approaches to
Providing Advisory and Consulting
Section 3: Administrative and Services ..............................................256
Organizational Issues Understand to Whom the Service Is
Targeted .......................................258
Chapter 10: Billing and Engagement
Building Your Fortress’ Wall of
Considerations ..................................223
Services ........................................262
Tracking Your Time for Billing
Building the Wall Profitably ......264
Purposes .......................................224
In the Real World .....................265
viii
Contents
Building the Empire .........................266 Section 5: Putting It All Together
Determining the Most Appropriate
Chapter 13: Facilitating Your Clients’
Services: The Notion of
Meetings ............................................344
Synergy .................................268
Our Role in Meeting Facilitation .....345
We’re Doing Both and It Seems to Be
Stay Neutral—Do Not Take
Working Fine ...............................273
Sides .....................................345
Don’t Get Complacent .............275
Manage the Process ...................346
Stay on Top of Your Marketing
Help the Group Stick to Its
Focus ....................................275
Guidelines .............................346
A Summary of the Differences .........276
Help Stay on Track and Keep
It’s Time to Make the
Moving Along .......................347
Determination ..............................278
Ensure All Are Heard ................347
Before We Move On ........................278
Provide Concepts and Comments
Chapter 12: Marketing Your Firm and When Useful ........................347
Your Services ....................................283 Suggest Procedures ...................348
Developing a Marketing Strategy ......285 The Bottom Line About Our
Developing Your Marketing Plan ......286 Role .....................................348
Understand Your Market ...........286 Types of Meetings ............................349
Understand What You Are Problem Definition Meetings ....349
Selling ...................................287 Decision Analysis Meetings .......350
Determine Your Objectives .......288 Implementation Planning
Fine Tune Your Target Meetings ...............................351
Audience ..............................289 Process Facilitation: Facilitating Your
Fine Tune Your Message ............295 Clients’ Meetings ..........................353
The Role of Exposure ..............296 Gaining a Shared Understanding
Choose Which Exposure Vehicles of Objectives, Agenda, and
Are Best for Your Approach ..............................355
Organization .........................297 Expectations and Concerns .......355
Monitor the Results..................316 Keeping Everyone Focused on the
Don’t Let Marketing Get Out of Matters at Hand ....................356
Hand ............................................317 Processes to Help Your Group Be
Manage Your Marketing Time ..........318 Productive .............................356
Marketing Must Be Planned .............319 Dealing With Difficult
Everyone Has to Be Accountable to Behavior ...............................358
Someone for Marketing to Meeting Management ......................360
Work ...........................................319 Utilizing the Minimum Decision
Customer Relationship Resource to Make Decisions:
Management ................................321 Who Should Be Making the
Where Your Firm Is in Its Life Cycle Decision? ..............................362
Matters Too ..................................322 The Bottom Line ......................365
Before You Move On .......................323 The Right People, the Right
ix
Contents
Number, and the Right Silence Is Powerful ....................370
Climate .................................365 Handling Questions ..................371
Effective Group Presentation Practice Creates a Path to
Techniques ...................................366 Comfort .......................................373
Control Your Eyes .....................367 Before We Move On .....................374
Be Aware of Your Posture ..........368
Conclusion ........................................377
Use Gestures to Give Emphasis
and Avoid Appearing Stiff ......368
Appendix A: Sample Timed
Project Your Voice .....................368
Agenda...............................................380
Clear Your Visual Aids ..............369
Using PowerPoint or Other Appendix B: Food for Thought for
Presentation Packages ............369 CPAs Regarding Facilitating
Look, Then Turn and Speak ......370 Client Meetings ................................382
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