Why do some professional service firms continue to outperform their competition? Why do some continue to grow and others decline and become less relevant? Why do some retain and grow their client base while others lose clients and shrink?

Yes, there are short-term initiatives to give firms a boost, like hiring one of the more senior specialists from another firm or taking on a whole team from a competitor. But a sustained advantage over competition means consistently being better at the people dimension than your competition. It means embedding certain important things so deeply in the culture and DNA of the firm that your competitive advantage and way of life cannot be replicated.

The important things?

Those things were revealed in a study conducted by my firm, Insync Surveys, involving the views of more than 100,000 employees from around 200 organisations, including professional service firms, that identified seven habits that starkly differentiate high performance from low performance organisations. Those seven habits are:

• live an inspiring vision 

• communicate clear strategies and goals   

• develop your people   

• go out of your way to recognise your people    

• genuinely care for your people   

• listen and adapt to your customers’ needs   

• continually improve your systems.

Set a clear direction

Partners of accounting firms need to be able to articulate why they have confidence in the future of their firm. Their confidence needs to be so compelling that all their staff will buy into it and build it into their everyday thinking and discussions (habit 1). They will need to make their vision real by backing it up with clear strategies and goals (habit 2) that link to and explain how success will be achieved.

Managers need to ensure that all their staff know how their particular role and day-to-day actions link to the firm’s strategies and goals.

Our research shows that only 24% of employees in low-performing organisations say that they can easily refer to a list of their organisation’s main goals. The figure is 54% for high-performing organisations. Firms need to put the goal posts under floodlights – they need to make their goals clear.

Be good at the soft stuff

Most professional firms are pretty good at developing their people (habit 3) with things like impressive and sought-after graduate programs.   Your people are by far your greatest asset – you can’t afford not to develop them well.

However, many accounting firms are less good at recognising their people and thanking them for their contribution.

I say, “go out of your way to recognise your employees” as I mean just that. Yes, it is great to have formal recognition programs and events but partners and managers must get into the habit of going out of their way – making a special effort – to say thank you and recognise their staff.

Go out of your way to recognise your employees.

If partners and managers were able to find a few spontaneous opportunities to recognise staff each week it would begin to make a massive difference across the firm over time as those down the line will begin to model their behaviour. The ultimate aim is that saying “thank you” becomes a way of life in your firm.

It is not uncommon for staff to be asked to stay back late at work, cancel social engagements, respond to emails and answer phone calls on sick days, weekends and annual leave without so much as a simple “thank you” passing the lips of the person doing the asking.

The simplest of gestures at times can have the biggest impact. But, we have to be timely. There’s no point thanking someone for something that occurred six months earlier.

You must demonstrate genuine care for your staff if you want to get the best out of them. If you expect them to go above and beyond the call of duty, as most firms do, you need to reciprocate by showing you care for and will look after them. But you must be authentic as staff are very good at spotting a fake.

Most firms don’t have very good feedback systems to ensure they know and can address the real concerns of staff.   Most need to get better at seeking feedback and acting on it when appropriate.

Listen and adapt to your clients’ needs

This means not just ensuring that clients are happy with the particular service or piece of advice but with the entire interaction from the time they committed to requesting assistance through to the invoicing and any post service follow-up.

Having systems to ensure you get regular feedback from clients is critical.

High performance firms understand their core competencies and match them with their ideal clients. They segment their clients and know which ones are profitable and why; and which ones aren’t.

Greater understanding of clients helps firms evolve their business in a way that benefits everyone.

Continually improve your systems

People, systems and processes need to work seamlessly. Too many firms introduce new systems without giving sufficient attention to the impact of changed workflows and the need to change behaviours of people for those new systems to work well.

Often the systems training and change management aspects of implementing new systems is compromised due to a desire to save money.  This is a big mistake.

Firms that skimp on their systems must recognise that their actions are likely to compromise the good work they do in embedding the other six habits. Good systems will often be critical to delivering on the firm’s strategy and goals and achieving its vision. If systems are neglected employees will wonder whether the firm really cares for them.

Customer outcomes are also often compromised as a result of inadequate systems.

All habits are interrelated and indispensable

The seven habits are not a smorgasbord where you choose the ones you like. Nor can you just adopt them for a season. You must embed them so deeply into your firm’s culture and DNA that they become a way of life in your firm. All seven habits are interrelated and indispensable to the achievement of high performance.

The Seven Habits Of Highly Effective People by Stephen Covey.

 

Nicholas S Barnett is a director, business leader and strategist. He is CEO of Insync Surveys and author of 7 Business Habits That Drive High Performance (Major Street Publishing).

This article was first published in the February 2015 edition of Acuity magazine.