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The Business of Accounting (short reviews of three books)

As part of my exploration of the role of the Accountancy Practice as a provider of support and advice to small and medium sized businesses, I have read three books aimed at helping accountants define and develop their practices:

– “The e-Myth Accountant: Why Most Accounting Practices Don’t Work and What to Do About it
by Michael E. Gerber and M. Darren Root

– “How to Quickly Grow Your Accountancy Practice: By acquiring and keeping the clients you really want
by Steve Hackney and Richard Brewin

– “The UK’s Best Accountancy Practices
by Steve Pipe

The e-Myth Accountant: Why Most Accounting Practices Don’t Work and What to Do About it

I want to start by saying I am a fan of Michael Gerber’s “The e-Myth Revisited: Why Most Small Businesses Don’t Work and What to Do About It”. While written in a style that sometimes grates to my British ear, I feel the book introduces some “truths” about the nature of the owner-managed business and the dynamics of growth. In “The e-Myth Revisited” Gerber sets out a clear approach for owner-managers seeking growth which seeks to address the inevitable challenges and hurdles that they will face. I find the advice to treat your business as if it were going to be developed into a franchise a helpful mechanism that encourages the development of appropriate systems. These combine to enable the owner to start to work “on”, rather than “in” their business and enable them to move from being a pure “technician” toward a role that includes being an effective “manager” and “entrepreneur”.

I was, however, very disappointed with “The e-Myth Accountant“. While co-authored with a practicing accountant, the book offered little that provided domain-specific insight. Instead, the book consisted of a series of homilies from the authors which urged the reader to adopt the e-Myth way, but lacked any meat that would help the reader develop practical strategies for change. While the key messages from “The e-Myth Revisited” remain with me, two weeks after reading “The e-Myth Accountant” I cannot remember anything that seems useful! As I write this I opened the book again, and skimmed through the content and – no, nothing to report. Sorry!

Here is a book that does not live up to the philosophy that it seeks to promote. Gerber urges us to treat our businesses like franchises so that highest levels of service-quality can be delivered on a continual and repeated basis. Yet the “Accountant” offering within the e-Myth franchise demonstrates the worst aspects of a franchise – delivering a product that relies on, rather than enhances, a trusted brand.

How to Quickly Grow Your Accountancy Practice: By acquiring and keeping the clients you really want

In this book Hackney and Brewin set out a multi-stage approach that aims to help accountancy practices define their target market, marketing messages, and the appropriate media and methods for delivering those messages. They identify 14 “agenda items” that firms should address in order to develop an appropriate strategy for growth – illustrating how two fictitious firms (one “traditional” and one that follows Hackney and Brewin’s advice) might address these agenda items.

The book touches on the need for “process”, “management” and “marketing”, which roughly translate to the definitions of “technician”, “manager” and “entrepreneur” in Michael Gerber’s “The e-Myth Revisited”. However, unlike Gerber, the focus in this book is almost entirely on the “marketing” aspect of a growth strategy. In doing so, the author’s did try to practice what they preach and really did try to “sell” the approach they advocate. Did they succeed? Well not to this reader!

From the very start, the book fell into making over-blown claims. The inner sleeve provides details of the authors saying “Richard Brewin … is renowned for being one of the few people who has created two perfect practices” – perfect! - anyone who claims that their organisation is “perfect” does not earn my trust. Later they claim “We can go into almost any accountancy firm and release thousands of pounds of revenue and profit, literally overnight” – literally overnight! And how do they achieve this? Well they launch into a folk story about “acres of diamonds” and “moments of truth” – and while they may have provided some useful motivational encouragement to act in a positive way, I was so busy looking for evidence as to how they were going to release thousands of pounds of profit “literally overnight”, I am afraid it did not work for me.

The problem may be all mine, but for me the inflated “marketing speak”, along with a number of inaccuracies (like misusing the term “Boston Matrix”) and the fact that the book continually made assertions based on the author’s “research” without providing any evidence for the basis of this research, all led me to disengage from some useful techniques and approaches that I am sure could help accountancies grow their business. But my biggest criticism is that, unlike Gerber in his original “The e-Myth Revisited“, Hackney and Brewin imply that it is easy to grow a business (if you just follow their approach) – it is not, and to imply otherwise undermines the validity of any advice they may be able to offer. (See my post Why Grow? where I discuss a much more appropriate message from marketing “guru” Seth Godin.)

A much better and less sensational approach to helping accountancies achieve growth is demonstrated in an interview between Paul Shrimpling of Remarkable Practice and Rob Walsh of Clear Vision. Here both marketing advisor and practice owner repeatedly articulate the need for the business to be able to deliver on the promises made in the marketing message.

The UK’s Best Accountancy Practices

After the disappointment of the previous two books, Steve Pipe’s “The UK’s Best Accountancy Practices” was a revelation! As I have said previously, this book contains case studies of over 40 UK accountancy practices, each of which provides and insight as to how practices are serving their clients and growing their businesses.

Pipe states that he hopes that the examples of excellence will inspire, and for me, the descriptions of practical action, sometimes radical and sometimes relatively mundane, and often in the words of the partners themselves, are far more inspirational than the authors attempting to achieve guru status. As Pipe says, “there is no theory in these pages – just example after example of what real UK accountancy practices have done … to generate better results for their clients, their communities and themselves”.

There are some issues with the book:

  • All but one of the case studies are from firms within the AVN network, and as such, have not surprisingly adopted both similar strategic approaches and similar tools and techniques. There is therefore a degree of repetition. However, each firm is distinctively different and it is fascinating to see how different organisations implemented similar approaches in very different ways.
  • Some of the methods adopted by firms within the book have been criticised, for example in here on the “accounting web” site.
  • Pipe is both a researcher and founder of the AVN network. He is therefore open to the criticism that his work “is just promoting AVN and it’s services”. However, while it would be good to see more independent academic research into the role of the accountancy practice as a service provider to the business sector, Pipe appears very open and clear about any links with AVN and it is clear that the accountants quoted in the case studies are speaking with their own voice.

This book does provide an excellent example of “open innovation” in practice, where firms are willing to share information as to “what works for them” with potential competitors.

Of the three books, “The UK’s Best Accountancy Practices” that gave me the greatest insight into the role of at least a subset of accountancy practices and how they are serving our small-business sector. As such, it gave me grounds to be optimistic that there is potential for our best accountancy practices to be a real force for good in the provision of effective support for their clients.

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