What if the expertise that makes you a great accountant is actually what’s holding your firm back from reaching its full potential? It might seem surprising, but many owners discover that their strong technical knowledge can actually make it harder to grow their firms into successful, large-scale businesses.
In a recent webinar, Mark Ferris, Chairman and CEO of Panalitix, shared important tips on how owners can break away from being stuck in their own expertise to create more successful and scalable businesses. Drawing from his experience with many different firms, Ferris highlighted some surprising ways that being highly skilled can sometimes hold back growth.
Ferris offered simple strategies to help owners turn their practices from just a job into a valuable business. He challenged common ideas about what makes an accounting practice successful and provided a clear guide for firm owners who want to grow their businesses while also gaining more personal freedom.
The Hidden Barrier: When Expertise Limits Growth
Accountants are recognized for their strong knowledge, dedication to helping clients succeed, and commitment to doing their best work. These traits are crucial for building good relationships with clients. However, they can also create ways of working that make it harder for businesses to grow and expand.
Ferris, who has spent many years working with accountants, points out that the biggest challenge to growing an accounting firm isn’t a lack of technical skills or difficult market conditions. Instead, it’s the belief that being personally productive is the same as achieving success in business.
“The promise of professional services was that you train yourself, gain unique skills, and enjoy a long, lucrative business life deriving good fees,” says Mark. “But would we say that today to young people entering the profession?”
The main issue is that while accounting education teaches valuable technical skills, it doesn’t really help future business owners understand how to grow and manage a company. As a result, many owners find themselves trying to expand their business by simply working longer hours, taking on more clients themselves, and keeping a tight grip on every part of their service. This approach can be overwhelming and may not lead to sustainable growth.
The result is that the profits of the business are constrained by the owner’s time and energy. Even though they deliver great value to their clients, they might feel unappreciated and overworked. Instead of pushing themselves harder within the same old way of doing things, it’s time to rethink how an accounting practice can work for everyone involved.
Shifting Mindsets: From Doing the Work to Building the Business
The main difference between a traditional accountant and a business builder is how they view their work. While traditional accountants focus mainly on managing numbers and financial records, business builders see their role as helping to grow and improve a business. A traditional accountant might say, “I work to complete tax returns,” whereas a business builder says, “I work to build a business that completes tax returns.” This small change has a big impact on business value and personal freedom.
Think about celebrity chef Gordon Ramsay. He began his career as a talented chef, but he found true success when he shifted his focus to creating restaurants and systems that ensure top-notch service, even when he wasn’t personally in charge. This kind of change can also happen in the field of accounting.
Business builders take a unique approach when it comes to planning and making decisions. Rather than just looking at short-term earnings and financial reports for the next year, they focus on creating long-term plans that span three to five years. This allows them to build valuable and successful companies that can thrive over time.
This involves creating systems, processes, and teams that reliably provide great service, whether or not the owner is directly involved.
“Successful businesses do not depend on the owners for much if anything,” Mark notes.
It’s not about choosing between being a great accountant or being a great business owner; it’s about gradually transitioning from handling all the tasks yourself to establishing a business that can operate effectively on its own. One CPA’s experience shows how this change can take place over time.
Case Study: A $550K Practice Transforms into a $10M Enterprise
Transitioning from a technical specialist to a business leader is possible with the right change in perspective. Take, for example, a certified public accountant (CPA) from Tampa. Over the span of ten years, he grew his small practice, which started at $550,000 in 2011, into a thriving business worth $10 million.
At first, he stuck to a conventional approach, putting in long hours and managing everything on his own. By 2015, he was working over 2,500 hours a year, taking care of all parts of the business while also trying to keep up with a growing number of clients. The big change happened in 2016 when he took a surprising step: he decided to spend $155,000 to hire a chief operating officer, even though it would hurt his profits in the short run.
“That was arguably a very bad decision if you’re focused on the short term and on the P&L,” Mark explains. “But he decided to invest in that and get a lot more things off his plate.”
The owner of the business made a choice to delegate responsibilities, which started a major change for the company. He slowly moved away from handling daily operations, production tasks, and finding new clients. Now, he acts as the chairman, concentrating only on providing valuable advice to six chosen clients, while the business continues to do well on its own.
The transformation wasn’t instant or easy—he “messed it up a couple of times”—but the result is what the business builder mindset promises: a valuable business that generates wealth without the owner’s constant involvement.
Your Path to Transformation
Transitioning from being a technical expert to becoming a business architect can be challenging, but the benefits of creating value for a business and gaining personal freedom make it a journey worth taking. The process starts with a change in how you think about your role. Instead of just viewing yourself as a talented accountant, start seeing yourself as someone who designs a system for the business. This system should be capable of achieving great results even when you’re not constantly overseeing everything.
The story of the Tampa CPA shows that it’s possible to change and improve how an accounting business operates. This change involves rethinking traditional ideas about what leads to success in this field. The outcome is a more valuable business, happier clients, a more satisfied team, and a sustainable work style that doesn’t rely on the owner being involved all the time.
Ready to Transform Your Practice?
Are you interested in turning your practice from a job into a valuable business? Check out the full webinar recording to learn about the changes in thinking and practical actions you can take to create a more sustainable accounting practice. Plus, by participating, you’ll earn free continuing education credits while discovering how to make your work better suit your life.