A large national accounting firm, located in Dallas, saw that their non-profit clients were struggling with the expensive cost of the services the firm was providing. They had MoneyPenny come in and look at the current processes they were utilizing. The head of the non-profit division brought in her team and described to them the dilemma. Their clients saw that the work performed could be done just as easily and more cheaply by smaller firms. This was not a good situation. The large firm had significant overhead and higher payrolls. Cutting the pricing with the same systems would not work, just as increasing the price would mean current clients may leave and new ones would not come on board.

The first thing we did was to go through all the steps that were performed to meet the monthly needs of the trusts the division managed. Several people were involved. Ask one a question, and he would say, “Well, I do this, but you have to ask ____ what they do because I think they do something different.” Redundancy, file duplication, and silos of information abounded. All that was required for this specific task was to reconcile the monthly statement, prepare the bills that were to be paid, and FedEx the checks to the client. Yes, this was 2011 when I worked on this, not 1999. It took four people five days to accomplish this work, per client.

All of these accountants are billed at a very high level. The firm was making good money on ‘the busy work’ being performed. The clients were getting savvy to the idea that the cost did not justify the outcome. There was considerable concern that if the process were changed, the billable hours would be lost and those accountants had quotas to meet. It quickly became quite clear that it was not just a process change that was needed. Human re-engineering was also required. I looked at the senior partner that brought me in, and she smiled and nodded. “Thanks a lot,” I wanted to say. She knew the problem but brought in an outsider to bring clarity to all the others. They either adjusted how they worked, or they were going to lose these clients — clients that did not want to leave and typically were not worried about price but the firm was not making any profit and could not raise their prices. Jeff Bezos, CEO of Amazon, said recently,

“If you want to ensure your extinction, fail to evolve.”

What was amazing to me was the young age of the accountants in this division and the lack of acceptance of newer technologies to increase efficiency. Excel spreadsheets passed around on thumb drives and laptops on various operating systems with different versions of software on each? Ugh. And a sea of 40 heads on one section of one floor. Not what I was expecting of the outwardly high-tech firm. I spent a week on-site at this location and left feeling like if they instituted the changes, it would work. That is always the end game for us: WILL THEY ACTUALLY DO IT?

The first step was to define which clients would work well with the new systems. Next, we had to pick a candidate out of their staff that was willing to take on the new technology. That was the most difficult part. The CPA candidate chosen was obvious to me and the senior partner from the start. Figuring out compensation took some definite change management. This firm held its internal CPAs to quotas on hourly billing. The majority of this work would be administrative management. Once a new compensation matrix was accomplished, and all the technology was put in place, the first client was transferred to the new methodology. After a few hurdles of getting comfortable and a few GoToMeetings, the next group of similar clients was set up. The 35 steps that took four people five days were down to three people and one day per client. That length of one day was due to a response time of the persons involved. No more Excel files, no more duplication of work, and most importantly, no increased fees to the client. Another bonus to the firm? Increased profit.

Did they have to invest in new technology? Not really; they had what they needed, they were just not utilizing it to the best abilities of the network and software that existed. There were a few technology changes. They did add on the hosting of software with an ASP to allow off–site staff to work in a secure environment the firm controlled without the need of passing files. They also added Bill.com for those trust clients who wanted to pay their own bills. Those clients loved it. No longer were they signing paper checks they received in FedEx packages around the globe and then sending back to Dallas for mailing.

This re-engineering took what appeared to be a very long time, four months to get running smoothly. The data entry work for this was outsourced to India. The India team actually had more working knowledge of the newer software methodologies and technologies than the Dallas-based staff, but the young person in Dallas was a fast learner as he came with no preconceived notions. At the end of four months and, as the CPA team leader in Dallas told us there was one typo, but all was running smoothly, and other divisions in the firm were taking a peek at what was happening.