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Maryland Society of
Accounting And Tax Professionals

Maryland Society of Accounting And Tax Professionals

This webpages is a summary of the content, templates and guides shared by Mark Stovel, CPA at the MSATP conference, June 8, 2023.

Advisory Services Playbook

Why Offer Advisory Services?

Advisory Services are the fastest growing Accounting Firm service offering.

  • Offers valuable, outcome-oriented services
  • More fulfilment in the work
  • Better Profit Margins
  • Better Work Life Balance for firm owners and teams.
  • SMB Demand for good advice is increasing

 

Big 4 Accounting Firms – Advisory Growth

Source: Monadnock Research LLC

Top 100 Firms in the UK – Advisory Growth

Source: Accountancy Age

Accounting Firms – Advisory Revenue – Current vs. Future

Source: Global Advisory Trends Report 2021/2022

What Are Advisory Services?

Advisory is an ambiguous term for all services that are not compliance focused.

Top Advisory Services

  • CAS/BPO
  • Attest
  • M&A
  • Estate/Trust Planning
  • IT + Data Security
  • Business Valuations
  • SALT
  • Industry Specialization
  • International Tax
  • Tech Consulting
  • Business Intelligence
  • Family Office

Source: Accounting Today

Accounting Firms – Advisory Services

Source: Global Advisory Trends Report 2021/2022

Overcoming Barriers to Advisory 

1. Compliance Focused  →  Advisory Focused

  • This is the biggest barrier for compliance heavy firms
  • Compliance is defined by tax law + past events
  • Advisory is defined by business constraints + future goals  
  • Move from a Volume to Value

2. Current Firm Talent and Structure

  • It can be hard to ‘repurpose’ teams to offer advisory services

Examples

  • BPO (Business Process Outsourcing) + CAS
    • Bookkeepers → AR/AP Clerks
  • Forecasting + FP&A (Financial Planning + Analysis)
    • Seniors accounts → Analysts

3. Systems and Technology

Two Part Barrier:

    1. Systems and technology are a major part of business advisory services
    2. Connectivity to the client’s systems is required for efficient and seamless delivery of advisory services

4. Non-traditional talent

  • There is a growing shortage of accounting professionals
  • Leveraging non-traditional accounting talent is underestimated
  • Accounting Firms have ‘blinders’ on with services they offer and team members that can complete that work

5. Unclear Messaging

  • The term ‘Advisory Services’ is not understood by most clients
  • ‘Bookkeeping’ and ‘Tax Preparation’ are understood 
  • Advisory needs to be clarified AND defined:
  • Less about what WE do, more on the CLIENT’s outcome
  • We’re stuck relying on our existing client pipeline

    How to Offer Advisory Services?

    There are five key pillars to focus on:

    • Position
    • Proposition
    • People
    • Process
    • Pricing

    1. Establish A Market Position

    • What services will you offer?
    • What clients will you serve?
    • Specialized and Expert Firms

    Most firms will go wide with their offers and target clients. It is better to narrow and deep.

    Three General Advisory Buckets

    1. Maintenance Advisory – CAS, Quarterly Tax Advisory, Actual to Budget, Cash Flow Projections
    2. Project Advisory– IT Implementation, workflow development, M+A, R+D Credits
    3. Strategic Advisory  – Strategic growth, Turnaround advisory 

    2. Creating a Value Proposition

    • What are the problems you solve?
    • What is the value you deliver? 
    • Create a clear problem statement of who you help, their problem, your solution and your offer name. 
    • An audience → Industry → Sub Industry → Niche
    • Problem → Confidence, operational, growth or cash flow
    • Solution → Specific to the problem 
    • Offer → How is that solution delivered

    An example of a defined Proposition:

     

    Audience – SBStandard.com

    Problem- SBStandard.com

    Solution – SBStandard.com

    Offer – SBStandard.com

    3. Hiring the right People

    • What internal competencies are you missing?
    • What non-accounting hire make sense?
    • Upskilling and training your internal team
    • Empower them with opportunities to research and explore (IE non-billable hours)
      • External courses and training
      • Creating reports + dashboards
      • Explore technology
      • Speaking with clients
    • Hiring the right talent is a shortcut to gaining expertise
    • Hire not based on what they DO, but what they KNOW
    • Full time hires vs. fractional talent
      • R+D: Lawyers + IT professionals
      • M+A: Investment bankers + Finance professionals
      • CAS: Operations managers
      • Systems: IT + Automation experts

    4. Develop a Delivery Process

    • Connectivity to the client
    • Internal capacity and workflows
    • First thing: Connect Systems as much as possible
    • Focus on Data Flow not Data entry
    • Better connectivity equals less administration time

      Almost all of my advisory work included commenting on and/or overseeing implementation of new tech

    • Second thing: Standardize the delivery process
    • Standardized:
      • Onboarding webforms
      • Information request webforms
    • Monthly Reporting Package
    • Meetings twice monthly

    If it can’t be standardized, it can’t be repeated.

    5. Create a Pricing Strategy

    • Discovery and Sales Process
    • Value vs. Volume
    • Project vs. Recurring

    Discovery and Sales Process

    Advisory Sales Cycle and Process is different from Compliance

    • Compliance → Services
    • Advisory → Outcomes

    Advisory Requires Discovery

    Compliance is Furnace Maintenance. Advisory is Home Remodelling

    Value vs. Volume

    • Advisory has to be priced on value, not volume.
    • Value is Contextual
    • Don’t price the service – Price the Client (and their situation)
    • Price is what your client pays. Value is what you deliver.

    Your Advisory services succeed because of who your Clients are, not because of what you offer.

    Project Vs. Recurring 

    • Hourly, Fixed and Subscription
    • Hourly tethers you to your inputs → Penalized for efficiency
    • Fixed focuses on outputs → You won’t go above + beyond
    • Subscription targets outcomes → Delivers maximum value

    Getting Traction With Your Advisory Services?

    • Messaging + Marketing
    • Leveraging your current client base
    • Finding + Creating audiences

    Messaging + Marketing

    • Create a Problem Statement:

    I help _____________ to ___________ by providing___________ with the _____________ program.

    Example > Small Batch Standard:

    Small Batch Standard helps [Small Craft Breweries] to [redesign their business model] by [moving from an Amateur to Pro Brewery] with the [Turning Pro program].

    Leveraging your current client base

    • Make a list of your clients
    • Client that are:
      • Growing/ Transitioning and need more support
        AND
      • Match your problem statement
    • Have close and ongoing conversations with your existing clients.

    Finding and Creating Audiences

    • All service transitions in your firm will succeed based on the number and quality of the clients for that new service
    • Creating a new pipeline of clients will be required to make advisory profitable in your firm.

    Finding Audiences

    After you decide the service you’ll offer and the clients you’ll serve, you need to find them.

     

    • Online Audiences
      • Social platforms (FB, Inst, LinkedIn)
        • Groups
        • Influencers
      • Podcasts as a Guest
      • Articles in online magazines

    • Offline Audiences
      • Trade Group + Professional Organizations
      • Build relationships with:
        • Other CPA Firms
        • Law firms
        • Insurance providers
      • Get onstage as much as possible

    Creating Audiences

    • Using your messaging to create an audience
    • Posting on Social Platforms
      • There is a lot of appetite for good accounting content
    • Create Guides, Whitepapers (Lead Magnets)
      • Collect Email Addresses
      • Blogs + Newsletters