Putting Excellence Into Practice Audio Chapter 29

Chapter 29 – The Perception Of Value For Money

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Part 5: Establishing Better Capacity through Value

Chapter 29: The Perception of Value for Money

 

With the rapid decline in the perceived value of compliance work, and the increase in automation of this core service, it’s more important than ever to provide added value. In fact, these changes only appear threatening to accountants who refuse to adapt. Personally, I see it as a wonderful opportunity. Using technology to produce the core numbers leaves you time to better utilise your skills, by having meaningful conversations with clients about how making small changes to those numbers can make a huge difference to their turnover, profits and cashflow. As a result, they’ll be able to invest in, and grow, their business.

 

When AVN help accountants improve the value they provide, we focus on three key areas:

 

1. Value mapping: Enhancing the customer experience at every interaction, and adding additional interactions to increase the perceived level of professionalism even further.
2. Adding value to core services: Taking time to analyse the accounts data, producing trends, analysing strengths and weaknesses, spotting opportunities and connecting that data to the aspirations of the business owner (both for their business and for their personal lives), having regular meetings and asking thought-provoking questions.
3. Delivering added-value services that add value to the client’s business: Promoting tools such as our ‘Performance Measurement and Improvement Programme,’ or ‘BoardView’ an AVN packaged service in which, in addition to playing a virtual FD role, the accountant also plays a strategic role within Board meetings.

 

First though, to return to basics, a question I’m often asked is: “What is value?” The simple answer is that it’s subjective. If, in the eyes of a potential buyer, an item’s perceived value outweighs its asking price, then you have a sale.

 

Adding value means you raise a client’s perception of the value of an item or a service, ideally with minimal effort and cost. To give just one example of the many ways you can do this, let’s take a look at car valeters, who are now so popular that you often have to queue, especially when, as well as a quick valet, some people also want the interior of their cars cleaned. This takes time and you usually need to sit outside. In fact, I’ve often used this service myself and on a sunny day have gone for a walk or sat somewhere nearby to read.

 

Recently, however, I’ve started to use a valeting company that’s a little further away and a little more expensive. Why? Because they’ve kitted out the attached building that would once have housed a small convenience shop and sales counter (like many other such companies, they’ve moved into a former filling station). All they’ve done is add a couple of vending machines – one for drinks and the other for snacks – a few tables, some comfortable chairs, and installed WiFi. But guess what? They now get far more business.

 

True, they may have had to make a small initial outlay, but the vending machines probably add to their profits and the cost of WiFi and heating will be minimal. And, as a result, they can charge considerably more for their services and there’s always a queue – which demonstrates that people value what they’ve added.

 

Little things really can add to the value experience.

 

Remember how, in the section on positioning, I described the importance of first impressions? Clients’ perceptions of your value need to start high and – at the very least – be maintained, if not improved upon, with every single experience.

 

Another example of adding value is packaging. If you’ve ever purchased an iPhone, then you’ll know that even opening the box is an experience in itself. The chances are that once you’ve checked your phone, the box will go straight in the bin. But people talk about the packaging and what a pleasurable experience it is to open it. It forms part of their kinaesthetic and visual experience.

 

Similarly, packaging your core services in a kinaesthetically tangible, visually aesthetic way (in other words, one you can touch and is pleasant to look at) adds credence to your solution. It’s why our ‘Performance, Measurement and Improvement’ package, which – despite the general move to the Cloud – is presented in the form of a good old-fashioned binder (albeit one branded with each practice’s colour scheme and logo), has a bigger take-up rate amongst the firms that keep it in this format than amongst those that make it Cloud-based. Our conclusion? Most of us still like to hold something – we feel we own it and therefore are more likely to buy into it.

 

Let’s imagine that it’s you who needs an accountant. In fact, right now you’re looking to work with a different accountant because you don’t feel you’re getting value from your existing one. They’re reluctant to embrace some of the new technologies you’ve heard so much about and you feel they’re a little set in their ways. You know of a different accountancy practice in your area though, so one day you type their name into your search engine.

 

However, you find their website is pretty basic. It explains they do accountancy, bookkeeping, payroll and audits, so you decide to give them a call to find out a little more. The phone rings for quite a while before it’s answered, and then it’s by someone who almost sounds impatient that you’ve interrupted them. You explain that you’d like to know more about the practice and wonder if you could speak to someone. The person explains that no one is available right now but they’ll get someone to call you back.

 

A day or so later, you get a call from one of the partners. They arrange a meeting and email you the address of their practice, but nothing more. When the time comes, you arrive on time but struggle to find somewhere to park. (Although the practice has its own car park, it’s full.) As a result, you have to find a spot on the street and then run back to the office. By this time it’s started to rain. As you’re about to enter the building, you notice that the two spaces nearest to the door have a sign saying they’re reserved for the partners. “Charming!” you think, as you shake the rain from your coat.

 

Inside, there’s a reception hatch covered with a glass screen, behind which a receptionist – who doesn’t even look up – is typing. You wait, a little uncomfortably, until they have finished their sentence, at which point they slide the hatch open and ask how they can help. You introduce yourself and explain that you’re here for a meeting, but can’t remember the name of the partner you’ve come to see.

 

The receptionist gives a small sigh and proceeds to call the partners one by one to find out which of them has a meeting booked. Once this has been established, they ask if you’d like tea or coffee (you’d prefer green tea, but go with the traditional variety in the lack of anything better) and then take you through to the meeting room. One side of this is stacked with boxes of books and client records. Although there are framed certificates of the partners’ qualifications on the walls, the wallpaper is peeling and the carpet is a little the worse for wear with a fair few coffee stains. There’s even a faint smell of damp.

 

Things pick up a little when the partner arrives, as at least they look smart and introduce themselves, and shortly afterwards your tea arrives. After a brief discussion, they give you a rough idea of the likely costs of bringing your accounts and bookkeeping to them. A few days later, you receive a formal-looking document by post that contains the proposal they’ve put together. However, you’ve now had a few days to think about it and have decided that your experience with them so far hasn’t been great.

 

This time, instead of looking for a specific accountant, you use Google to search for accountants in your area. One of the names that comes up stands out because it has lots of reviews and a five-star rating. You click on the link and go to their website. This time, you’re immediately impressed. Unlike all the other accountancy websites you’ve seen, this one doesn’t mention accounts or bookkeeping. Instead, it tells a story and describes the difference they make to the clients they work with.

 

As you read, their words strike a chord because they exactly describe the challenges you’re facing. You discover that not only can they meet all your legal requirements by producing your accounts work, but they share example after example of how they’ve helped businesses grow by using their skills with numbers to analyse this data. Their specific methodologies will help you determine the numbers in your accounts that – if changed in small ways – can have a significant impact on your business.

 

As well as numerous testimonials and case studies from satisfied customers, you notice they’ve also earned awards in business growth and customer service. By now, you’re seriously interested, but are probably thinking that they’re outside your price range. As you read further, though, you find that not only do they give a fixed price for their services, but that they’re so confident in their abilities they offer a full money-back guarantee.

 

Although the price is a little higher than you’d originally planned, you think for a while. Are they really too expensive? Or might they be worth it? You remember, too, that case study after case study described how a client’s profits had soared as a result of working with them.

 

You pick up the phone and give them a call. In just two rings it’s answered by a pleasant-sounding voice. You repeat your previous query and, although none of the partners are available here either, this time the person who answered the phone gives you a quick run-through of how they operate: A client manager will meet you to gain a good understanding of your business set-up, then ask some additional questions to determine the best solution and to make sure you get a fair and accurate fixed price.

 

There and then, they offer to arrange a meeting at a date and a time that works for you and to allocate you a client manager. They even ask whether you’d prefer the client manager to come to you or for you to go to them. Impressed, you decide to go to them and a meeting is arranged for the next morning.

 

No sooner have you hung up then you receive an emailed calendar-invite with their address, telephone number and a link to a YouTube video to help you find their office. Intrigued, you click the link and the video includes a brief greeting from the practice receptionist who explains that as the office can be a little tricky to find, what follows is a time-lapse dashcam recording of someone exiting the nearby ring road and travelling to it.

 

The next morning you arrive for your meeting after a straightforward journey as per their directions and, in the car park, you see your name on a sign, reserving a space for you right beside the entrance. (Already you feel special!) As you enter the building, the receptionist smiles and greets you by name, takes you to the conference room and offers you a menu. This contains a list of drinks that, as well as tea and coffee, includes fruit and green teas, cold drinks, beer and even Champagne!

 

By now, you’re really starting to wonder if the practice is out of your league. However, you settle for a green tea and the receptionist leaves you. (You’ve arrived slightly early.) On the table in front of you, next to your tea, is a folder, the front of which has a child’s drawing and the words: “These are the lovely words people say about my daddy.” Inside, all recently dated, are case studies and testimonials.

 

As you continue to look around, you notice that a TV is playing a slideshow. Each screen begins with your name, then goes on to tell you about the benefits you could expect from working with this practice. There are also quotes from clients, some sharing the improvements in profit and cashflow they’ve experienced, or the tax they’ve saved; others talking about how much more time they can now spend with their families.

 

There are also a number of posters on the walls that ask questions such as: “If anything were possible, what would you do with an extra £1,000,000?” or “What’s currently stopping you from achieving your business goals?” Just as you’re considering how you might answer these, the client manager enters, introduces themselves, and asks you exactly the same question. Perhaps slightly nervous by now, you reply saying that you don’t really have any goals – you just have a small business and are looking for an accountant to take care of your accounts and bookkeeping.

 

You take a seat and the client manager – let’s call her Jenny – sits next to you (rather than on the other side of the desk, like at the first practice you visited). She explains that it would really help if she understood your business so that she can provide an accurate fixed price there and then.

 

You begin to explain and Jenny listens intently and appears genuinely interested. After you’ve given a basic overview, she drills down even further with questions that go far deeper than simply ascertaining your number of transactions and turnover. Next, she moves on to asking about your role in the business, how it meets your personal needs and how many hours you work.  As she seems genuinely interested, you start to open up: you’re working a lot of hours and your relationship at home is suffering. In fact, even when you are at home, your mind is on the business and whenever your kids want to play you find yourself saying you’re too busy because you’re dealing with some work-related emails.

 

The client manager then asks why you set up your business and what your dream was. You’re taken aback. It’s not something you’ve thought about for a long time. But, slowly, you start to remember: You felt you could deliver a better solution than others you’d experienced. However, you realise you’ve fallen into the same trap as everyone else. You haven’t created the business you thought you would.

 

Next, you’re asked: “If anything were possible, what would it look like?” As you paint a picture of the vision you once had, you feel a sense of excitement that you haven’t felt in a long time. Jenny asks how this ideal business would impact on your life. You think for a moment, then explain that you’d be able to deliver a better service, for a higher income, and without having to work quite so many hours. You’d no longer have to worry about where your next customer was coming from or how you were going to pay the bills. You’d be able to spend more time with your children – they’re growing up so fast already that soon they’ll be in their teens and probably won’t want as much to do with you anyway. You get emotional at this because you know you’ll never get the opportunity again, but, right now, your priority has to be putting food on the table for them.

 

Whilst you’ve been describing this, Jenny has been listening and asking questions. She then feeds back to you the vision you’ve just shared, both for your business and for the lifestyle this would give you. “Yes! That’s exactly it!” you say, as you hear your aspirations described with an air of confidence that they’re achievable.

 

She asks what you think has been holding you back. You explain that you find it difficult to price your services because there’s so much competition. You struggle to get customers and, when you do, it takes longer to deliver the services than you priced for and you end up making very little profit or even a loss.

 

The client manager switches on her iPad and opens a piece of software called ‘Time’s Up!’ She enters some of the information you’ve given her, takes out a brochure and places it on the table so you can both see it. She thanks you for being so open and honest and assures you that you’ve come to the right place because their practice can help you achieve your goals. On the first page of the brochure is a list of the problems they specialise in helping business owners overcome, and many of the phrases you’ve just used appear.

 

She turns over and the next page describes how their accountancy practice helps make the numbers that matter most to you, better. She explains how their business solutions not only deliver basic compliance services, but so much more as well. Then she introduces their nine-step solution: ‘Performance Measurement and Improvement’:

 

1. Decide what you want to achieve by gaining clarity on your goals both for your business and personal life.
2. Develop a plan by turning your goals into a business plan, forecasts and budgets.
3. Measure how well you perform each month through a combination of traditional management accounting information and KPIs (that way, you’ll have your finger on the pulse of everything that matters) and then use this information to fine-tune your action plans.
4. Measure your annual performance by producing full financial accounts at the end of the year (as required by law).
5. Evaluate your performance by comparing this to previous years, so that the underlying trends are clear.
6. Evaluate your performance by comparing it to the rest of your industry, using benchmarking to identify your strengths and weaknesses.
7. Estimate how much your business is worth so that you can assess how well you are creating value.
8. Calculate how much more profitable and valuable your business could be through using everything you’ve learned about your own performance and that of others.
9. Develop a performance improvement plan (i.e. an action plan that sets out precisely what you’re going to do to improve your performance).

 

She explains that while Step 4 is pretty much what all accountants offer, her practice believes in helping businesses to improve. “Wow!” you think. This is so much more powerful than anything you’ve experienced from accountants in the past.

 

She turns another page of the brochure and explains that they offer three levels of service: Five-star, four-star and three-star. The five-star package includes everything she’s just covered in the nine-step solution, plus regular meetings and accountability to ensure that you maintain focus on carrying out the ideas and actions that arise from the meetings. (After all, she adds, your business will only improve if you implement these!)

 

She asks if that might be something you’d be interested in. You pause, then say that – given your current financial situation – you’d better see what the fee comes out at first. She smiles, grabs her iPad and selects the five-star option. The monthly investment figure that comes up is a lot of money, true, but – because the benefits it will bring have been clearly explained – you appreciate why.

 

You ask if she can talk you through the next level. She refers back to the brochure and shows you a chart detailing exactly what each level of service offers. She explains what you won’t get in the next version down. You begin to feel that this will simply prolong how long it takes to get the results you’d like. You hint you’d love to go for the five-star option, but how can she be sure you’ll get the results you need?

 

Picking up her iPad again, she minimises the pricing app and loads another piece of software called ‘SSTW’ (Simple Stuff That Works). She enters some additional information about your business and explains that SSTW will help you break down seven key sales drivers:

1. Pricing for maximum profit
2. Getting more leads
3. Converting more leads into customers
4. Getting customers to buy more from you
5. Getting customers to buy more frequently from you
6. Stopping customers from leaving you
7. Systemising for consistency.

 

Next, she explains how making some fairly small changes in your business to each of these will lead to a significant improvement in your profits and income. As she talks through each one, she shares a very simple strategy and you have a brief conversation about how you could easily apply it to your business. She also increases each of the drivers by just 1% or 2% from its current rate. By the time she’s finished you realise that your business could easily generate several times more in profits than the fee she presented you with. Finally, she reminds you that they offer a guarantee and explains how this works.

 

You decide to go for it – after all, the benefits far outweigh the cost – and she returns to ‘Time’s Up!’ to select the five-star option. She asks you to confirm your choice and then clicks an onscreen button to pull up the agreement. This specifies the service you’ve requested and details everything it includes in depth. For example, although unlimited phone calls are included, the agreement notes that if any of these lead to additional work, a fee will be agreed prior to it taking place so that you aren’t presented with any surprise bills at the end of the year. In addition, there’s a long list of all the other benefits you’ll receive and a guarantee of your money back if you don’t receive the value you expect.

 

Jenny talks you through every part of the document to confirm you agree – you absolutely do! – and asks for your bank details so she can set up a direct debit. (That way you can spread the payments rather than having to pay in one go.) You sign on the dotted line and feel really positive about the future. Finally, you think, you’ve found someone who understands you.

 

To finish up, she books you the dates for a year’s worth of ‘BoardView’ meetings (included in the package you’ve chosen), and explains that these are like having a Finance Director attending your Board meetings. However, rather than purely reporting on the numbers, they’ll explore strategic thinking around improving your business (in line with the seven sales drivers, eight profit drivers and cashflow drivers) and maintain a ‘OnePage’ plan for your business to track the KPIs that will keep you on target to achieve your business and personal goals.

 

As you stand up to leave, she asks if you enjoy a competitive challenge. Intrigued, you say, “Yes.” She takes you to a room just off reception where you find a Scalextric and, on the wall, a leaderboard recording the best lap times. You smile at the childhood memories this brings flooding back and she asks if you’d like to try to get on the leaderboard. You have an amazing time – albeit for just a few minutes – and leave buzzing.

 

Outside, you find that your car has been valeted. The client manager, who’s accompanied you, explains that they have an arrangement with a nearby company to give visitors’ cars a valet as a gesture of goodwill. Finally, as she says goodbye, she hands you a welcome pack and explains that it gives a lot more information about the practice and the improvement journey you’ve just embarked on with them.

 

By the time you arrive back at your own office, you’ve received an email containing a welcome video from the practice and a digital copy of the proposal that you still have in your hand. Finally, as you open the welcome pack, a bar of chocolate falls out with a short note saying: “Have a break and enjoy this snack whilst you read your welcome pack.”

 

You smile, take a bite, and settle down to read.

 

The scenario I’ve just described is not hypothetical. It’s the experience of every prospect who visits an AVN member’s office. Of course there are variations – I’m not suggesting each member should be a clone, and these aren’t franchised practices – but each one has thoroughly mapped out their customer journey from start to finish to ensure the experience remains high from the very first interaction. (Additional reports, for example, produced for every meeting and each containing that extra ‘wow’ factor, help to maintain this).

 

Naturally, I don’t expect you to adopt this exact approach, or to make overnight changes, but I do expect you to be aware of existing and prospective clients’ experiences at every interaction and to explore ways in which you can make these better. To help, I’ll break this scenario down in the following chapters so that you can replicate some of its key components.