You have more capacity than you think.
I am going to show you how to free up to 4 hours per Accountant per day of new capacity – without hiring any more Accountants.
I’ll use the example of a sole practitioner with 5 Accountants. You can multiple the maths out for your size firm. You’ll see that by implementing just 3 strategies you can free up to 4 hours per Accountant per day – maybe more. With 5 Accountants that’s 100 hours per week or 4,500 hours+ per year.
If you have an average hourly rate of just $150 that’s $675,000 of new capacity. You could re-fill the capacity or downsize your team. Have I got your attention yet?
Let’s get to work.
Strategy # 1 – Administration team = 1.5 hours per day
Our research indicates that Accountants spend an average of 1.5 hours per person per day on activities that they should not be doing. They spend a lot of time doing ‘administrative tasks associated with the Accounting job’. They might collecting information from clients, setting up work papers, importing data etc. Anything that is not considered Accounting work would fall under this category.
All you need to do his hire 1 new person per 5 Accountants. This person is a professional administrator called a “Client Service Coordinator”. Their job is to manage the workflow, the client information flow and any administration tasks associated with the client project. Previously these tasks were done by the Accountant now they are done by someone else who is probably more capable.
If you hire the right type of administration people and the Accountants delegate to them than you’ll free up around 1.5 hours per Accountant per day.
Strategy # 2 – Cloud Accounting = 1.5 hours per day
It’s a proven fact that the more clients you have on a cloud accounting platform the more efficient you are. The data is more accurate so there is less ‘checking’ needed, there is no ‘version control’ issues and the data is in real time. It’s just a more efficient system.
It all adds up to less time needed to process the Accounting work. Once all business clients are switched across, we have examples of up to a 60% reduction of time needed at the Accountants side once this part of automation is realized. Let’s be conservative and it took you 3 years to convert all of your clients across to a cloud Accounting system and you didn’t realize a 60% reduction but a 25% reduction in time.
If your Accountants are normally effective for 6 hours per day and they are now 25% more efficient that is another 1.5 hours per day of new capacity.
Strategy # 3 – Workflow management = 1 hour per day
Not only do Accountants do tasks they shouldn’t be doing (see strategy 1) but they are also waste a lot of time doing what they are supposed to do. To prove a point I like to do a brainstorming session which goes like this:
“This task took 30 hours to complete last year. I know it can’t be done, but if it could be done, hypothetically what would need to change, alter, stop doing, different system or different whatever to get it done in 5 hours”
With the word ‘hypothetically’ in the exercise it opens the minds and we get some fabulous answers. However, the answers are all the same. Accountants tell us the same 5 things every time.
To get this task to 5 hours instead of 30 hours the following would need to be in place.
- All the information to be available before starting
- Self imposed deadlines communicated to team and clients
- One job at a time worked on
- No interruptions
- Productization and Systemization of what we do
So then I say – just go an do that!
Let’s say you did and you were only able to find 1 hour per Accountant per day. Then that’s still 1700 or so hours per year. The culmination of these 3 strategies has an enormous impact on your capacity.
With 3 key strategies, you can free up 4 or more hours of capacity per day per Accountant and you can realize (in this example) $675,000 in new capacity.
These strategies (and 30+ more) will be discussed in detail at my upcoming ‘Firm of NOW’ seminar. For you to be a Firm of the Future there are key strategies to implement NOW. Being more efficient to create capacity is one of them.
You can get more details on the Firm of NOW seminar by clicking here. Bring your entire team and get total alignment.
The first event in Australia is in Melbourne on July 18 and then the USA leg starts in Los Angeles on August 8. It’s a full-day program. Register now. I’d love to see you there.