It’s very easy to increase profits in an Accounting firm. Simply have the most senior people (partners) charge more time. The partners generally have the highest charge rates and theoretically the most experience.
Yes you will increase profits but for the short term only.
David Maister, author of many outstanding professional services firms’ books said it best:
“What you do with your billable time will determine your income.
What you do with your non-billable time will determine your future”
Assuming that the partners of the firm are partners for the right reasons (not a glorified / expensive senior Accountant with the title of Partner) then the partners should only be doing 3 things:
1) High end advisory work for a small percentage of time <30% of time. 2) Nurturing existing clients making sure each client has every service they need to satisfy their goals in life. 3) Acting in a leadership position – driving performance, winning new clients & innovation. If Partners spend 2 hours analyzing phone bills and scrutinising the colour of the receptionists new chair - not a good use of partner time. If Partners spend 2 hours doing compliance work for $200 per hour. Hmmm - not a good use of time. If Partners can spend 2 hours in a client meeting and bring back a $10,000 project with a 75% margin then I would consider that a good use of partner time! Enjoy video no. 3