Accountants Need to Put More Thought into Succession Planning
Accountants aren’t putting enough into succession planning, according to recent research.
A recent survey conducted by the National Society of Accountants suggests that just 28% of accounts have any sort of succession plan in place.
This problem is intensified by the fact that industry is dealing with increasing amounts of job movement. In fact, a report from ADP indicates that job turnover in the accounting industry has increased by 27% since the first quarter of 2016. More than six out ten employees are either actively or passively looking for a new job, the report suggests. Such a trend means that many accountancies may not have a ready-made replacement in their ranks to run the show when the leader decides to call it a day, no matter how much training they invest in the person…
The five out of seven accountancies that don’t have a succession plan in place in preparation for a new owner are risking in chaos for their staff and clients when they time to hunt for a new owner begins.
However, there are simple steps that accountants can take to become prepared for this situation.
Train Multiple Candidates
The additional job movement, identified by the ADP survey, has left companies with the problem of their training investment being used by employees at other companies.
The solution is not to reduce training opportunities. It’s to increase the breadth of training opportunities offered. The more employees you have with the skills to one day lead the company, the better your company will run and the more likely you will be to have a successor within your ranks of employees. This is an ideal situation for most companies, although not always possible.
Start Planning Now
It may sound obvious, but the sooner a company prepares for this situation, the better prepared they will be. It’s never too soon to start planning such a pivotal moment in the history of your company. If you’re not rushed into your search, you’ll be more likely to find (or train) the perfect candidate.
If you’re set to recruit a successor externally, get them on board for a while before the reins are completely handed over. This will allow you to guarantee a much smoother transition between owners, while establishing the image, culture and goals of the company.
Establishing how the current processes, boundaries and structure of the company works will help you ensure that clients and staff members hardly feel the impact of such a major change.
Even when the baton is passed on, there’s nothing stopping the previous owner being available in an advisory role, if they choose to. This will not only help the new owner cope with the transition, but it can also be useful to help the old owner deal with giving away the company they built from the ground up.
Succession Risk makes it as simple as possible to select a the most suitable successor for your accountancy business. Click the link to learn more about how we can help you.