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5. The Big Push -- Getting Ahead Of The Work Now

The Big Push -- Getting Ahead Of The Work Now

Summertime and the livin' is easy … That famous song line can have a familiar ring to many CPA firms this time of year. So why is it that we can't get work done and out the door? Daylight expanded, but so has the work in progress. That wasn't the plan was it?

"The Big Push," may bring to mind those extremely busy weeks before March 15 or April 15, but I'm really referring to the big push to place as many clients as possible on extension in an effort to level out the work, reduce the crunch at the deadline and more fully utilize staff during the summer months. At least that's the theory, right? Yet here we are nearing the end of the summer and many of the returns we pushed seem to have lost inertia and are sitting, just waiting for someone to finally get around to working on them. The reality for some firms is that the big push just creates an even bigger crunch at the extension deadlines.

Importance of Deadlines

We are deadline-driven people. When the deadline looms we don't just see it coming and know that it is there, but we can feel it. It motivates us to action and keeps us working on all cylinders until we can finally relax and coast. But don't get the wrong idea. Level-loading the work is a basic tenet of Lean. Working at or above capacity creates more issues than just burn out. Therefore we commonly advocate and encourage our CPA firm clients to put their clientele, who are habitual extenders, on extension and to do so as early in January or February. This will enable you to get these returns out of the volume that need to be filed by the deadline. Notice, however, that I didn't say we encourage them to place as many returns as possible on extension.

The reality for many of our business and individual clients and for our business is that value-driven service equates to a tax return that is filed by the deadline and not placed on extension. We need to analyze our capacity and work with or manage our clients to get us their information timely and in the form we need to deliver the excellent service that they value. This is also true for those clients we do place on extension. Do our clients value us not working on their return until the extension deadline? Of course not. We should put the prior year to bed as soon as possible and focus on planning opportunities (a.k.a. value) for this current calendar/next filing year. 

Here are some recommendations out of the Lean Six Sigma playbook:

• Tone at the Top - you've heard this before. The leadership of the firm defines the priorities, sets the expectations and holds everyone accountable. We can certainly relax a bit after the deadline(s), but management of the work should always be a priority. The volume of work should decrease, but our expectations surrounding accountability to the work, standards of timeliness, and delivering excellent client service should not.
• Measure What Matters - metrics. Ignorance is far from bliss as a business strategy. Work to understand your capacity and the volume of work so that prior to the beginning of busy season you can implement a plan that drives client contact, coaches information in the door, controls the amount of preparation time involved, manages to review capacity and ultimately allows you to make the type of decisions that demand high visibility. Prior to the deadline you should know how many returns have gone on extension and have a plan in place for when and by whom this work will be completed.
• Time Goals - after all we're deadline-driven. Now that you've measured, you can improve. Determine what goals are reasonable or achievable for each cycle within your process. Hold personnel accountable to these goals even after the deadline. For example, tax preparation should take eight hours for these types of returns regardless of when they are prepped. Reviewers should review within "X" days of a prepared return. Obviously, there will be exceptions to these rules but at issue is maintaining and holding ourselves accountable to these standards as an internal deadline. 
• Make It Visible - when you see it, it's real. Knowledge may be power, but running a successful CPA firm is a team effort. Everyone should know how much work needs to be done and by when.  Whether your firm has a sophisticated electronic workflow or not, keep this information front and center. It isn't too hard then to see how busy staff will or won't be and how much new business you'll need to bring in to keep the staff utilized.

Summer affords us the capacity of time. Let's use that time to remain business-focused and profit-driven.  In your "free" time, undertake an initiative to become more operationally efficient so that you can become more effective business consultants to your clients. To learn more, contact us today!