I get the privilege of working with some really smart accountants…and I get to see their financial statements…so I get to see the results of their good decisions. I recently signed a practice owner with a large practice with larger than normal profits. I also recently read a very interesting article about Charlie Munger in the Wall Street Journal. If you don’t know who Charlie Munger is, he is Warren Buffet’s long-term business partner and vice chairman of Berkshire Hathaway. He’s 90 years old and has a long record of making good decisions. The incredibly simple business philosophy of our successful client bears a striking resemblance to that in practice at Berkshire Hathaway.
Here is what my client said about the key to operating a successful accounting practice:
We have incredibly good clients and a tremendous staff. Some of them have been with me for a long time…one of the reasons for the retention of staff, is that they are able to live a balanced lifestyle. My staff have not worked a Saturday in years. My belief-Do a few things really well and efficiently but don’t do everything.
Here is what Jason Zweig’s article in last Saturday’s Wall Street Journal said about Charlie Munger:
Many money managers spend their days in meetings, riffling through emails, staring at stock-quote machines with financial television flickering in the background, while they obsess about beating the market. Mr. Munger and Mr. Buffett, on the other hand, “sit in a quiet room and read and think and talk to people on the phone,” says Shane Parrish, a money manager who edits Farnam Street, a compelling blog about decision making.
”By organizing their lives to tune out distractions and make fewer decisions,” he adds, Mr. Munger and Mr. Buffett “have tilted their odds toward making better decisions.”
Filtering is key. Most accountants do what is similar to what most money managers do. They are incredibly busy, operate at fast speeds, and take on too much. The path to a better business is found by keeping things incredibly simple. The way to do that is to take stock of what you are currently doing with your time and then figure out what to eliminate and/or delegate.
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