Yesterday my golf coach (James Staniforth, Royal Queensland supremo) gave me an exercise that involved hitting a green with a 7 iron. He use a scoring system based on the quality of the shot hit. Depending on how bad the shot was it would be neutral, -1, -2 or -3 points. If it was a good shot then either +1 or +2 points. It’s pretty tough because to score positive you have to hit the green on the full.

After the first 50 balls I scored my best of +11. After being pretty pleased with myself he then changed the rules and tightened up the scoring system. He took out the neutral score and gave my 40 balls only. I quickly went to -8 with 20 balls to go. Not a good look.

Then James said “I’ll give you one chance to reset to zero”. I told him NO – I will claw my way back.

And I did. I clawed back to +11 and then on my last ball scored a point and went to +12. Afterwards I felt it was time to give James a little seminar. This is what I said.

“When I ran the marathon I did not stop half way and start again because my time was not great. When Jessica Watson (teenage sailing sensation who just sailed around the world unassisted at 16) did not get half way around, quit and then start again.”

I think he got the message. There is no reset in life.

NB – A version of this article appeared in the Australian business publication, BRW, today.

Why do accountants take so long to get paid by their clients? They are nice people (bit too nice sometimes), they do fine work that adds a tremendous amount of value to the clients, they have reasonable client relationships, and they are trusted by their clients.

But they are often the last to be paid. Having 50-80 days in average debtors is not uncommon. Are they taken for a ride by their clients – or are they just too soft?

Yes they are too soft – and too nice sometimes!

Niceness aside I think a lot has to do with the traditional billing practice that most firms adopt. Do the work, calculate the bill after write offs (where the client knows nothing of the price) send out an invoice sometime after the work is finished, and then wait to get paid. And finally when the debtor hits 772 days outstanding a lame follow up procedure kicks into gear. I was being facetious about the lame procedure!

So why not fix the problem at the root cause. It’s not the clients fault – it’s the processes fault. Change the process and change the result.

I think accountants should price every job before starting. Give the client an agreed price on the project, what the scope is and what the value of the project is – just like every other business out there. Then when you present the engagement letter or proposal to them give them some choices how they can pay.

Here are some examples of some options on how the client can pay – that you can build into your engagement letters.

Payment methods:

Option 1 – 50% upon signing the agreement and 50% in 45 days

Option 2 – 5% – 10% discount if you pay the full amount before commencement

Or

Option 1 – 50% deposit upon commencement, 25% progress and 25% at the end

Option 1 – 5% – 10% discount if you pay the full amount before commencement

A couple of real examples: 4 partner firm in Perth. They gave the client an option of 50% now and 50% in 45 days or 100% now. Heaps of clients paid 100% now with no benefit!

Sole practitioner in Surburban Adelaide. They priced 3 consulting proposals (all of them well over $100,000) in the past 6 months. Each one was given a 10% discount if paid in full. They did.

You’ll have to position this carefully with your clients and you’ll be surprised at their reaction. The side benefit is that when you have all or part of the funds before starting the clients are more motivated to get the information you need – on time. Also, your team are more motivated to do the work more efficiently.

I rest my case.

In the past week I have presented 3 team training days for 3 separate accounting firms – and a client seminar for one of them also. There were all on-site and they all bought me at a charity auction. They paid a fee and I donated the fee to my favourite charity – stepUP.

We had the entire teams from the firms – 11-25 people at a time and all were encouraged to offer ideas for the improvement of the firm. Here are the comments from each of the 3 firms:

“Thanks for spending yesterday with our team. It was an awesome day for all of our team. They enjoyed the interactive was you worked with them on client service and working as a team. They’re buzzing and keen to get our action plan updated and prioritised for us to improve our rate of implementation. The senior team found the session excellent and it allowed us to clarify what we need to do to move forward from today. An excellent investment and we look forward to having you back again.” Leah Peacock, Sudbury’s, Whangerei NZ

“We had Rob work with our team for a day and as I see it, the most valuable part of the day were the ideas that came from the team and the goals set by the team. I was impressed by the way our team members contributed and boldness of their ideas in some cases. Those ideas would not have come forward the way they did in a regular team meeting. We are really looking forward to implementing team ideas rather than management ideas – the great part is that the commitment is already there! My only regret is that we didn’t have our supercharge day a long time ago!” David Hunt, Partner, Peter H Hunt & Associates, Sydney NSW

“The morning session on Tuesday provoked serious thinking within the team. In broad terms the outcomes were;

Clarity for one team member who was sitting in 4 different seats on the bus to move into 1 she likes – permanently,

The permission for one team member to feel Ok to want to move into a seat closer to the back of the bus,

Created a new seat on the bus to be filled,

The value of Marketing & Sales to an Accountancy Business,

Challenged their thinking regarding the ‘roles’ in our business – your new Organisational Chart,

Concentrate on delivering ‘Results / Outputs’, not ‘Activities / Inputs’,

Ask 6 questions and get to the root of the problem, not just the clients initial request for assistance,

Value of compliance and what our Client Managers (Snr Accountants) must be considering for the client at completion of each assignment,

Plus much more.

The afternoon session (7 Keys presentation) provided us with 11 prospects to meet with and provoked thought from 3-4 clients who want to chat further.” Ashley McGuirk, Core Business Management, Maroochydore, QLD.

The morning session on Tuesday provoked serious thinking within the team. In broad terms the outcomes were;
Clarity for one team member who was sitting in 4 different seats on the bus to move into 1 she likes – permanently,
The permission for one team member to feel Ok to want to move into a seat closer to the back of the bus,
Created a new seat on the bus to be filled,
The value of Marketing & Sales to an Accountancy Business,
Challenged their thinking regarding the ‘roles’ in our business – your new Organisational Chart,
Concentrate on delivering ‘Results / Outputs’, not ‘Activities / Inputs’,
Ask 6 questions and get to the root of the problem, not just the clients initial request for assistance,
Value of compliance and what our Client Managers (Snr Accountants) must be considering for the client at completion of each assignment,
Plus much more.
The afternoon session (7 Keys presentation) provided us with 11 prospects to meet with and provoked thought from 3-4 clients who want to chat further.

On my travels I often have an ‘in room’ massage. Not THAT kind of massage – a therapeutic one!

On my last trip to the UK Nat & I had 2 ladies in the room massage us each for 1 hour. Cost £95 each. Or in Australian dollars about $180 or so for the hour. I have paid up to A$225 for a 1 hour massage before.

Anyway, whilst I was laying 0n the massage bed being pummeled I started thinking about Accountants. Yes very sad I know. Why I was thinking about you?

The masseur was earning $180 as an ‘average hourly rate’ for work completed and I know heaps of Accounting firms who are not even close to earning an AHR of $180. Most Accounting firms I get to meet (before we start working with them) are earning $125 – $175 AHR – after write offs.

The work of the Masseur lasts about 24 hours. The work of an Accountant sometimes last a lifetime. Why do you charge by the hour? Why do you charge so little?

To wrap up the story here are a few pictures! Enjoy

Branson in wings

Team leader dressed appropriately. The 32 runners dressed like a caterpillar broke the record for the most people joined together (with bungee cords) running a marathon. They finished in 5hrs 13 mins. Pretty impressive. The 2 at the front are Sir Richard’s children – Holly & Sam. Natalie Imbruglia to the left and Princess Beatrice is in there somewhere as well.

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A lot of people got dressed up. I did not know I was running with Felix the Cat – bit out of it. At one stage I thought a lot of the crowd had come out for me (name on my shirt, calling my name) hence the waving. Alas the 700,000 spectators were there for everyone. Nat told me that Darth Vader finished at least 30 minutes ahead of me!

Buck palace + Rob

This is about 150 meters from the finish. Buckingham Palace in the background.

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I am about 20 metres from the finish. I was practicing my finish for weeks. One arm up twirling for 30 metres then both arms up as I cross the finish – with a jump for joy. That was the plan – couldn’t muster the jump for joy!

Rob finish with medal

Job done – got the gold medal, tee shirt, certificate, photo’s, injuries and stories for life to prove it. Exhausted I was.