Platt’s Perspective: Heed The Lessons Of 2009 For A Smoother 2010

One year ago, as the economy was perched on the verge of falling off the cliff, staff at firms across the country experienced one of three uniquely different reactions from their leaders:

First were the firms that ignored reality all together. These are the firms that, while they may have had numerous discussions in the Board room, did little or nothing to communicate to staff about how the firm would address changing economic circumstances. Even if partners in these firms had developed a strategy, it was not apparent to the staff, who heard only “full steam ahead” from the leaders.

Second were the firms that were tentative in their response, or didn’t effectively communicate a plan for going forward. Staff saw inconsistencies among the partners, staff being laid off, and many had a never-ending feeling that any day another shoe was about to drop.
Third were firms that were swift and sure in their response and reassuring about the future. They made the hard decisions, cut sharply where they needed to cut, acknowledged that “we’re all in this together,” and rallied their teams to do more with less so they could all make it through the tough times.

Now that firms are once again entering tax season, which will be critical this year, staff in the first two types of firms, understandably, may be nervous as to what the future holds.

If there’s a lesson to be learned, it is this: MPs need to acknowledge the reality of the economic situation, manage risks, be honest and truthful with staff, have a plan for getting through these obstacles, and effectively communicate and execute the plan so everyone knows where they stand.

Firms that have done this successfully over the past 18 months are in a strong position to move into 2010 successfully. The “Boogeyman” they saw in the closet early in 2009 turned out to be a manageable fear/situation. These firms are running with a tighter, leaner, staff of a higher caliber, and the focus on client retention and acquisition is more finely-tuned. These firms are keeping an eye on AR, billing promptly, and making collections a priority. They are looking to the future with new offerings and expanding their niches, with careful planning and thought. They are providing more value to their clients, and continue to market to defined markets.

For everyone else, the message is clear: don’t go into another tax season without learning from the lessons of the past year. Have your State of the Firm presentation, acknowledge the fear of uncertainty that everyone shares, relate a sense of optimism and lay out, and execute, a plan for the future now.