3 ‘must-haves’ for retaining top talent

I have written more about the talent shortages firms face than on any other subject. The growing wave of Baby Boomer retirements, the CPA Exam pass rate issues, the high demand for Millennial talent in virtually all industry sectors, the gender gap, and the lure of self-employment are all factors driving firm leaders to work harder than ever to find, attract, engage, and retain talent.

In fact, retaining qualified staff was the top concern for firms with 11 or more professionals in the most recent AICPA PCPS CPA Firm Top Issues Survey; it was a top five issue for firms with six to 10 professionals (see “Staffing Issues Surge to Forefront of Accounting Firm Concerns,” JofA, June 9, 2015). That might be because turnover is at its highest rate since 2009, according to the 2016 INSIDE Public Accounting National Benchmarking Report. Turnover rose for firms of all sizes, from 12.4% in 2015 to 13.9% in 2016. And listen to this: One in six IPA 100 firms lost more than 20% of their professional staff team members in the previous year. Wow!

Make no mistake: The cost of turnover is gigantic. Surveys estimate the “hard cost” of turnover is 1.5 to 2 times an employee’s salary. It’s much harder to calculate the soft costs: the hit to employee morale for those who wonder if they are missing something “out there,” the loss of client continuity and subsequent efficiency, the poor impression turnover makes on clients and potential staff, and the stress that the loss of good people brings to firm leaders. Yikes!

So, I’ve been thinking a lot about how to help firm leaders stop bleeding great people. And I’ve come down to three things that great people must have to be truly engaged and to build a career at your firm:

1. A sense of purpose

To feel good about our work, we have to believe that it makes a difference for someone. We want to know that our organization has a true sense of purpose—as brilliantly articulated in Simon Sinek’s TED Talk “Why.” We want to know that our organization is heading somewhere and that our leaders have a vision for a better future with a real plan to get there. To ensure your people feel this sense of purpose:

• Define and publish your firm’s “why” and incorporate it into all firm branding, communications, and learning. Begin all meetings with your mission to center your people on your purpose and to engrain it in your collective consciousness.
• Define, publish, and pursue a lofty, yet measureable, five-year vision that incorporates input from all levels within your firm and articulates where your firm is headed in terms of culture, competitive advantage, expertise and services, size and reach, and the difference you’ll make “out there” in the future. Share the vision and pursue its implementation with a single-minded intensity that brings meaning—and satisfaction—to your people. (For tips on how to develop a vision, see “Does Your Firm Have a Vision for Its Future?” CPA Insider, Jan. 30, 2012)
• Tie all roles and goals to the firm’s why and vision. Help your people see a clear connection between their work and your firm’s purpose and desired destination. This means thoughtfully tying partner and employee measures, promotion and compensation to your why and vision—and abandoning old, comfortable measures and performance management systems. The goal is to show your people that the factors that define their success also drive the firm to its stated destination.
• Make your purpose the top priority. Pay attention to what your leadership team spends its time on and what you communicate about most. Your purpose must be the firm’s top priority in words and deeds.

2. A sense of belonging

We all want to fit in and be accepted. We hope our talents will be valued and our idiosyncrasies accepted. We want to feel that we’re part of a unified team that cares about one another, celebrates successes together, and has one another’s backs. In my opinion, a sense of belonging is challenging to get right, because people under pressure naturally fall into self-centered and judgmental behaviors. So, getting this one “just right” takes leadership focus, intention, and courage, too. Consider these ideas for creating a sense of belonging:

• Celebrate and promote diversity of thought, experience, and background. Leadership and staff should learn about unconscious bias as a part of the firm’s ongoing education programs, which should also teach inclusive behaviors.
• Create a written code of behavioral conduct that clearly defines expected behaviors and also defines your firm’s zero tolerance for the many negative behaviors that drive your great people away. These include condescension, selfishness, bigotry, bullying, gossip, cliques, blaming others, targeting, labeling, retaliation and tearing one another down—to name just a painful but very real few.
• Quietly and diligently enforce your code of conduct and hold every person—even your founders, your biggest business developers and billers, and your “big dogs”—to the highest behavioral standards. Part ways with those who will not adhere to your standards. Make it clear that you mean business.
• Define alternative career pathways that acknowledge that every person is on their way to somewhere. Not everyone’s “destination” is partner. Your firm should strive to create customized, one-size-fits-one career pathways that support the needs of the firm and the employee. Is this approach utopic and harder to manage? Yes, but it’s necessary if you want to retain the increasing number of talented people who do not fit into the traditional “up or out,” single-path model.

3. A sense of empowerment and autonomy

Your best and brightest desire to make a difference. They want to be trusted, to shine, and to grow. They feel most fulfilled when they can make their mark, identify and solve problems, and drive progress. We sap their energy and mojo with micromanagement, bureaucracy, old-school thinking, and, to some degree, our traditional tenure-based hierarchy. Here are several steps to ensure your people feel empowered to contribute at their highest and best use:

• Encourage innovation and entrepreneurship. Create processes for generating new ideas, pursuing inventions and new markets, and piloting new programs. In a multiperson firm, name an owner for firm innovation, and empower him or her to quickly “pop up” a program to encourage entrepreneurial ideas and reward new solutions and revenue streams. To truly make this happen, budget nonchargeable time to allow your best and brightest to pursue their passions, try out their concepts, and fail safely. If your most innovative people can’t find an outlet for their creativity within your firm, they will find it elsewhere.
• Convey ownership of something to every person in your firm. Give your people a part of your “community garden” that they can make beautiful or grow. Assign one owner to every aspect of your practice, from departments, locations, key business functions, and specialties to smaller elements such as clients, engagements, people, departmental functions, special projects, committees, and agreed-upon action items from meetings. If you’re in a smaller firm and your name is in every firm leadership, management, and client service “box,” consider contracting some of those elements to others and encourage them to take ownership to drive those elements forward.
• Give up client control. This sounds so simple, but many firm leaders still limit client contact for staff and don’t expose their people to the “good stuff,” such as client meetings and the pursuit of referral sources and prospects. Bring a different staff member every time you go out! Let your people interact with clients. If you’re worried they won’t make a great impression, coach them so that they do.
• Eliminate traditional parity models in which people are promoted in lockstep based on their start dates. Quit assigning responsibility based only on levels. Instead, provide growth opportunities based on talent and potential—regardless of tenure or title.
• Embrace a truly flexible culture. Allow your people to work when, where, and how they want provided they produce the quality expected, meet their budgets and timelines, and respond in a timely fashion to others. Educate your firm leaders and team members on the cost of snarky comments and jabs that people make regarding those who work nontraditional schedules or in nontraditional locations. Examples include, “I forgot you worked here!” Or “Getting your beauty rest?” or “Let’s not assign her that—she works odd hours.” Make this sludge a “don’t” in your code of conduct.
• Adopt dress for your day (tomorrow!). The norm for dress in business is becoming more relaxed. Clients are getting younger. Expectations are changing. Give up the need to control what your people are wearing, and trust them to dress appropriately for the events that each day holds. This one costs zero dollars and takes no time to implement. In fact, some of your competitors may already be embracing this approach (see “CPA Firms Finding Benefits in Casual Dress Trend,” JofA, June 20, 2016, and “Will CPAs One Day Wear Shorts in the Office?” CPA Insider, Oct. 3, 2016).

I realize that you may feel overwhelmed after reading this. The suggestions are many and may represent a sea change in thinking—and behaving. I’m not asking you to undertake these things all at once. Instead, I’m asking you to identify at least one thing you can tackle now to give your people a greater sense of purpose, make them feel they truly belong, or empower them to make a bigger impact. When you do, you’ll take a step forward in retaining your talent and sustaining your firm.

Jennifer Wilson is a partner and co-founder of ConvergenceCoaching LLC, a leadership and marketing consulting and coaching firm that helps leaders achieve success. Learn more about the company and its services at convergencecoaching.com.