Posts

Accountants – how to really upset your client! (1 of 2)

Recently I had a coffee with a friend of mine who happens to be a CFO of a big law firm in Australia. As always to protect the innocent let’s call my friend Jeremy as in Jeremy Irons.

Jeremy had been unhappy with the accounting firm he was using for the last couple of years. So to bring the matter to a head he arranged a tender and invited 5 major accounting firms to bid and to keep things fair he invited the incumbent to also lodge a bid.

After a few weeks, all submissions were made and the “beauty parade” commenced. Of the six firms tendering 2 were stand outs, 2 were average and 2, as Jeremy succinctly put it, “were rubbish”. Their old accounting firm was one of the bottom 2.

I asked Jeremy why the incumbent firm had rated so poorly; was their a bias in his business that they had to change accounting firms no matter what? Jeremy had said no – the selection panel was more than willing to give them a fair go. However, in the period leading up to the tender and during the process the incumbent firm did themselves no favours. Jeremy shared the following two examples.

Example1:

Not long before the tender was announced Jeremy got a phone call from a senior partner in the accounting firm. The partner told Jeremy that another partner who was working on an important piece of advisory work for Jeremy was leaving their firm to join a competitor. Jeremy thought to himself well this isn’t good news but at least we’ll have a month or two to transition to another partner so the work can continue. Jeremy almost exploded in anger when the accounting partner told him, ” by the way … today is his last day” Jeremy was furious. He since found out that the partner doing the advisory work had resigned 3 months earlier and here he was being told that today was his last day! Jeremy considered the height of unprofessionalism and an incredible lack of transparency. Not a good look to say he least.

Tune into the next post to read example 2

James E

Accountants – how to really upset your client! (2 of 2)

Following on from the last post, here is the second example of how the incumbent accounting firm upset “Jeremy” the CFO of a major law firm (as if the first example wasn’t enough!)

Once the tender was announced, and the accounting firms invited to prepare the documentation and presentations ready for the selection panel, Jeremy noticed that the incumbent firm didn’t show much energy or enthusiasm for the process. When they came around to actually present to the panel they came up with a standard, average run-of-the-mill pitch. Nothing really stood out. Jeremy got the impression that they had already given up.

Ironically, in spite of the weakening relationship over the last couple of years, the incumbent firm still had the advantage of knowing practically everything about the law firm since they had been the auditor/adviser for the several past years. They knew things about the law firm that none of the other 5 firms could possibly know.

I get the feeling from Jeremy that if the incumbent firm pulled something put of the bag and had directly addressed the problems with the relationship they would have been in there with a much better chance. Also I was surprised to learn that the incumbent accountants had helped (and were quite successful) in referring clients to the law firm. In spite of helping the law firm grow their fee base it wasn’t enough to help the incumbent accountants keep their business. They needed to do their core job better. Just goes to show – accounting firms need to do much, more more to keep their clients happy. Being a “standard accounting practice” is simply not enough these days.

The other lesson here is to not give up. There is always scope and room to reinvent & strengthen the relationship you & your practice has with its clients no matter how difficult or strained.

In summary, the law firm they went with a big 4 accounting firm and the incumbent lost between $100 to $150k of ongoing work a year – not including special advisory projects. Quite a price to pay!

Catch you next post,

James E

How an accounting firm upset Al Pacino (1 of 2)

The other day I had a coffee with a friend of mine who happens to be a CFO of a big law firm in Australia. As always to protect the innocent let’s call my friend Al as in Al Pacino.

Al had been unhappy with the accounting firm he was using for the last couple of years. So to bring the matter to a head he arranged a tender and invited 5 major accounting firms to bid and to keep things fair he invited the incumbent to also lodge a bid.

After a few weeks, all submissions were made and the “beauty parade” commenced. Of the six firms tendering 2 were stand outs, 2 were average and 2, as Al succinctly put it, “were rubbish”. Their old accounting firm was one of the bottom 2.

I asked Al why the incumbent firm had rated so poorly; was their a bias in his business that they had to change accounting firms no matter what? Al had said no – the selection panel was more than willing to give them a fair go. However, in the period leading up to the tender and during the process the incumbent firm did themselves no favours. Al shared the following two examples.

Example1:

Not long before the tender was announced Al got a phone call from a senior partner in the accounting firm. The partner told Al that another partner who was working on an important piece of advisory work for Al was leaving their firm to join a competitor. Al thought to himself well this isn’t good news but at least we’ll have a month or two to transition to another partner so the work can continue. Al almost exploded in anger when the accounting partner told him, ” by the way … today is his last day” Al was furious. He since found out that the partner doing the advisory work had resigned 3 months earlier and here he was being told that today was his last day! Al considered the height of unprofessionalism and an incredible lack of transparency. Not a good look to say he least.

Tune into the next post to read example 2

James E