Don’t neglect your new practice’s most important asset.
This article first appeared in The CPA Insider™.
When you buy a CPA firm, how important are the staff?
When we ask practice buyers this question, most of them say something like, “Oh, they are very important—one of the most important aspects of the purchase.” But I’ve observed that, often, buyers of CPA firms are so focused on client relationships that they don’t do enough to nurture employee relationships.
Here’s a striking example of how not to treat employees after you buy a firm. Many years ago, when I first got into accounting practice brokerage, we had a buyer purchase a small practice with three bookkeeping employees. On his first day there, he walked into his private office, closed the door, and only came out once the entire day, for lunch. He didn’t acknowledge the staff with so much as a hello. (This is also an example of why it’s not always best to sell to the highest bidder.) Needless to say, this attitude did not serve him well. We found out later that he’d lost all three bookkeepers and a large number of clients.
Staff morale is crucial. It affects how the phone is answered, how the work is performed, and how clients are served. Furthermore, many clients will ask the staff what they think of the new owner(s). (And many staff members will let them know what they really think.) You want them to have only good things to say about you.
A happy, productive, long-term staff can be a powerful force for a smooth transition and a good business. Morale will have a huge impact on staff retention, client retention, owner satisfaction, and the profitability of your new practice. Here are some proven ways to help staff feel comfortable with you as their new boss:
Don’t leave them in a state of uncertainty
How can you boost morale after buying a practice? First, put yourself in your new employees’ shoes. They may not be saying much, but they are quietly asking themselves many questions, such as:
- Will I be able to keep my job?
- Will our work environment change?
- Is the new owner(s) approachable?
- Will my compensation change?
- Will my hours change?
In short, many will be afraid. The longer they are in a state of uncertainty, the more likely they are to be less productive and to be reconsidering their employment options. New staff need good leadership to help to answer their questions—and they need it as soon as possible after they learn of the change in ownership. One way to do so is through group announcements, which should be done in person and be kept fairly brief. Many sellers like to announce the sale to staff without the buyer present, and then introduce the buyer shortly thereafter.
Get to know them as individuals
We also recommend that our clients approach staff one-on-one as soon as possible after any group announcements about the change in ownership have been made. During these one-on-ones, be open and share some personal information. Once you’ve spent a couple of minutes talking, you need to ask questions to get each employee talking. Your job is to be quiet and listen. The more open-ended your questions, the more likely they will speak freely and at length. Here are a few examples:
- What do you best like about your job?
- What have you especially liked about working with the previous owner?
- Tell me about the strengths of your other team members.
- What can we do to help you succeed?
Plan fun outings and events to boost morale
Take your new employees out for a night of bowling, a local sports event, or simply to dinner to break the ice. They need to get to know you and feel comfortable with their new situation! Though these morale-boosters may sound frivolous, they’re actually one of the most important things you can do for a smooth transition because they will help put employees at ease about the changes taking place.
Schedule other fun events throughout the first few months of your transition. Find out what the previous owner did to boost morale, and ask the staff to come up with ideas. Use the best ideas you gather, and come up with some of your own. Tax season is an especially great time to do something fun. Bringing in doughnuts or lunch or pizza on late nights is usually much appreciated.
The little things matter. Treat your people well and they will take very good care of you. Create good morale and not only will your transition go more smoothly, but it’ll be a lot more fun, too.
About Brannon Poe: Brannon is the founder of Poe Group Advisors and has been facilitating successful accounting practice transitions throughout the US and Canada since 2003. He is also the creator of Accounting Practice Academy. Brannon is the author of the Accounting Practice Insights Blog and hosts the Accountant’s Flight Plan” podcast with other top thought-leaders in the accounting profession. Brannon is an E&Y alumnus. He has worked with some of the most successful and seasoned CPAs in the industry and has been privy to the behind-the-scenes methods that these clients have used to build highly profitable practices along with capable and independent teams. Brannon has authored multiple books, including Accountant’s Flight Plan – Best Practices for Today’s Firms (published by both the AICPA and CPA Canada) and On Your Own: How to Start Your Own CPA Firm, Second Edition (published by the AICPA). Brannon is passionate about entrepreneurship and is the president-elect of EO Charleston (Entrepreneur’s Organization)