One of the books that has had a profound effect on me is ‘The E-Myth’ by Michael Gerber.
Aside from Jim Collins’ ‘Good To Great’ it has to be the book that has had the most impact on me.
And yet, I realized recently, I have fallen into one of the most popular traps encountered by those who should know better, I`ve failed to implement a whole load of the theories and practical ideas that the book preaches.
It dawned on me the other day, when discussing with Salima, my wife (a Lawyer and entrepreneur, and a dedicated list-maker) some issues we were both interested in, I said, I have the answer to that – it`s on my desk... somewhere!
Yes, I have to be the first to admit that – if left to my own devices – I am a terrible procrastinator and don`t keep `to-do` lists like I know deep down that I should. My desk is covered in papers, all useful, that I mean to get around to organizing or implementing sometime, but because I have not organized them into tasks on a list, they sit there, uncomplaining, waiting attention.
In contrast, Salima has a book that she keeps her lists in and she dutifully crosses off each task when done. You don`t need to flip back many pages to find all the items neatly crossed off! Also, she has created her own knowledge management system in her media business that all of her staff can access online, anywhere in the world, any time of day.
So, I decided to set aside the procrastinating half of me, and let the action-based Steve take control.
It`s all well and good having a `to-do` list if you`re the only one having to do the items listed, but if your staff will have to do some of the action points, then it really needs to be online somehow.
As the idea grew, I decided to investigate what is more commonly known as a `knowledge management` system.
To my relief, I found a couple of workable options.
One, is a free `drop box` service, which is basically a web based filing cabinet that one can give access to staff to, for example, and store all the required information virtually.
The only drawback is that it has a relatively low storage limit before it becomes a paid-for service.
The other I discovered, is offered by a well known and trusted Canadian software vendor, who provide a more extensive service to capture all the vital knowledge we professionals store in our heads about our clients which we really should share with our team, but we just don`t know how or where to store it!
The impact a good knowledge management centre will have on a firm is accentuated when one considers how much knowledge a typical partner carries in his or her head about their clients.
Much of it never makes it to the file, simple, but important, stuff like, the client`s proper name is Ferdinand, but never call him that, he goes by `Ferdie`.
Add to that the fact that by the year 2020 some 75% of today`s partners plan to have retired, and you have just a ten year window to document and share this important information.
If you`re looking to sell your interest in the firm in the next ten years, having a parking space for this information will make your firm a little more attractive to potential buyers, who will have the comfort of knowing all vital client information has a home, and that they can access it easily.
Another survey stated that staff at your firm spend between 15% and 35% of their time just searching for information, and a staggering 40% of the time they never find what they`re looking for. What a waste of precious resources!
So, based on the above, I believe that having your very own `Wikipedia` now seems to make financial as well as practical sense.
Let`s look at just a few practical applications –
1. Manage your recruiting and human resources functions more effectively by having job descriptions, submitted resumes and performance review notes and more, all readily available, and subjected to security levels so sensitive information is only available to those who should have access to it.
2. Gather all of your best practices for auditing various types of organizations in one place so your team is primed before they start any particular new assignment, instead of learning on the job – something clients see and hate paying for!
3. Collect all your best tax thinking in one place and have templates ready to run, stop re-inventing the wheel each time a difficult tax problem presents itself!
4. I could go on, but you get the idea by now, right?
So, that`s what I am starting to develop myself – new internal systems to improve client service and an internal knowledge management system to store that information for all to benefit from.
I would urge you to follow suit and explore the options available. This seems to me to be an investment that has an immediate and tangible payback, and we don`t stumble across those every day!
Wednesday, March 31, 2010
Tuesday, March 16, 2010
Does Hi-Tech Offer A Competitive Advantage, Or Is It All Smoke & Mirrors?
That was a question I was asked to comment on at a recent Partner Retreat.
The firm in question was reviewing it's own IT and software issues and decided to ask me, from what I have seen in recent years at firms I have consulted with, how this firm stood as far as it's 'up-to-date-ness' and what an investment of $x should be expected to yield in new revenues or cost savings.
'Well' I said 'It all depends on your point of view and what you want to achieve' I then went on to ask them about their objectives, their budget, the type of services involved and so on until I had a clear view of what they were really asking me.It turns out, they were struggling with two things, and each one hit home to me just how much software has changed what we do and how we do it, and what a competitive advantage there is to be had for those with vision.
First of all, the client was asking me about auto-flow. Had I seen it working? Was it as good as it sounded? How accurate was it? and so on - the questions were flying!
Could a tax return really be completed, accurately, without having to input a single number?
So, I sat them down and told them the truth... the best system I had seen was about 85% accurate, so we're not yet at the stage where we can train monkeys to do this - but we are getting there!
There will always be a certain level of human input in the preparation or review of tax returns, but autoflow is taking us a giant leap away from the number of hours previously required to complete a tax return.
So, if you are prepared to accept that 15% of your returns need adjustments, autoflow is the way to go. The alternative is to enter 100% of the data into all client tax returns. Which would you rather have?
Based on this, they agreed that an 85% time saving, less the time involved in scanning, could be a substantial saving for them. They took a conservative view, and agreed that the receptionist and other administrative staff could easily be trained on how to scan T-Slips and so on, and after taking the time costs of staff, the assessed a 65% to 70% time saving (in real dollars) could be achieved.
Using that, they decided to move forward with that investment as a priority. It really was a no-brainer.
But more was yet to come.
Next, they wanted to know more about a 'what-if' analysis tool they had read about in my column for 'The Bottom Line' and seen demonstrated on a roadshow.
This tool took the client's data and allowed the practitioner to perform all manner of 'what-if' type scenario setting. You could set a target of $500,000 additional profit, and the software will work out for you how many extra units the client needs to sell, or by how much to increase prices to get to the goal, and many other options - like what costs would have to be cut - and so on.
Then it's down to the practitioner, using their knowledge of the client and their professional skill and judgment, to offer comments and modifications to the software suggested options and to make a blend of small adjustments here and there to arrive at the required outcome.
Now, the practitioner can sit down and say something like, 'well, if you can increase your prices by 1.3%, reduce costs by 0.75%, and increase volume by 2.1%, the effect of these combined criteria will produce an additional $499,876 in profit next year.'
In my previous life as a practitioner myself, I would have spent hours and hours on excel spreadsheets trying to fathom out these answers, but with the tools available today, they can be calculated in a nano-second!
Boy, how things have changed.
For the forward-thinking practitioner these two tools can make a tremendous difference to the type of work they do, the revenues they can generate and the satisfaction they can deliver to their clients.
Just imagine if every client had the ability to see the financial impact of any business decision BEFORE they actually made that decision?
Don't you think you'd have better clients a s a result? And what impact would that have on your own professional and financial satisfaction?
So yes, I answered, I do believe that being Hi-Tech offers a real opportunity to differentiate the firm, make more money and enjoy your work a little more than you did before, and it's definately not a smoke and mirrors job!
The firm in question was reviewing it's own IT and software issues and decided to ask me, from what I have seen in recent years at firms I have consulted with, how this firm stood as far as it's 'up-to-date-ness' and what an investment of $x should be expected to yield in new revenues or cost savings.
'Well' I said 'It all depends on your point of view and what you want to achieve' I then went on to ask them about their objectives, their budget, the type of services involved and so on until I had a clear view of what they were really asking me.It turns out, they were struggling with two things, and each one hit home to me just how much software has changed what we do and how we do it, and what a competitive advantage there is to be had for those with vision.
First of all, the client was asking me about auto-flow. Had I seen it working? Was it as good as it sounded? How accurate was it? and so on - the questions were flying!
Could a tax return really be completed, accurately, without having to input a single number?
So, I sat them down and told them the truth... the best system I had seen was about 85% accurate, so we're not yet at the stage where we can train monkeys to do this - but we are getting there!
There will always be a certain level of human input in the preparation or review of tax returns, but autoflow is taking us a giant leap away from the number of hours previously required to complete a tax return.
So, if you are prepared to accept that 15% of your returns need adjustments, autoflow is the way to go. The alternative is to enter 100% of the data into all client tax returns. Which would you rather have?
Based on this, they agreed that an 85% time saving, less the time involved in scanning, could be a substantial saving for them. They took a conservative view, and agreed that the receptionist and other administrative staff could easily be trained on how to scan T-Slips and so on, and after taking the time costs of staff, the assessed a 65% to 70% time saving (in real dollars) could be achieved.
Using that, they decided to move forward with that investment as a priority. It really was a no-brainer.
But more was yet to come.
Next, they wanted to know more about a 'what-if' analysis tool they had read about in my column for 'The Bottom Line' and seen demonstrated on a roadshow.
This tool took the client's data and allowed the practitioner to perform all manner of 'what-if' type scenario setting. You could set a target of $500,000 additional profit, and the software will work out for you how many extra units the client needs to sell, or by how much to increase prices to get to the goal, and many other options - like what costs would have to be cut - and so on.
Then it's down to the practitioner, using their knowledge of the client and their professional skill and judgment, to offer comments and modifications to the software suggested options and to make a blend of small adjustments here and there to arrive at the required outcome.
Now, the practitioner can sit down and say something like, 'well, if you can increase your prices by 1.3%, reduce costs by 0.75%, and increase volume by 2.1%, the effect of these combined criteria will produce an additional $499,876 in profit next year.'
In my previous life as a practitioner myself, I would have spent hours and hours on excel spreadsheets trying to fathom out these answers, but with the tools available today, they can be calculated in a nano-second!
Boy, how things have changed.
For the forward-thinking practitioner these two tools can make a tremendous difference to the type of work they do, the revenues they can generate and the satisfaction they can deliver to their clients.
Just imagine if every client had the ability to see the financial impact of any business decision BEFORE they actually made that decision?
Don't you think you'd have better clients a s a result? And what impact would that have on your own professional and financial satisfaction?
So yes, I answered, I do believe that being Hi-Tech offers a real opportunity to differentiate the firm, make more money and enjoy your work a little more than you did before, and it's definately not a smoke and mirrors job!
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