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December ’19

Ideas for the journey to better every day.

December ’19

Being the best in your category…

By Darren Root, CEO

Competing as a Modern Firm® makes all the difference

With the risk of sounding like an “old guy,” I’m dedicating this column to embracing a traditional elegance in our lives and in our Modern Firms. Here’s what’s motivating me: I recently finished the PBS series Downton Abbey. Don’t get me wrong, I realize this was a different time period, but what stuck with me was the overarching feeling of civility and elegance, and I was inspired by it.

I also recently finished listening to Horst Schulze’s new book, Excellence Wins. Schulze is the co-founder of The Ritz Carlton Hotels, where he implemented the standard of “ladies and gentlemen serving ladies and gentlemen.” I think that’s what I’m really drawn to the words ladies and gentlemen and how they embody the concept of modern elegance. 

Beyond feeling a need for modern elegance, I’m also feeling a strong calling to be proactive in relation to making my clients’ lives better. Think about that for just a moment. Whether it’s a business or individual client, at the end of the day, we are dealing with people. So what does it mean to make peoples’ lives better in the context of what we do? I’m talking about more than just traditional bookkeeping, payroll and tax compliance services. I’m talking about ladies and gentlemen serving ladies and gentlemen with a genuine, proactive approach to making their lives better.

Our clients have both financial and life goals, but more often than not, we are unaware of those goals because we haven’t asked. By identifying and tracking clients’ goals, we can help get and keep them on the right financial track. Tracking client goals and offering deeper insight into achieving those goals marks a big shift—a movement away from the traditional compliance mindset. 

So, what would our firms look (and feel) like if we were ladies and gentlemen serving ladies and gentlemen—all in the pursuit of proactively making clients’ lives better? I believe this will result is three big wins:

  1. Significant increase in client retention—A proactive approach to improving clients’ lives builds trust…and from that trust comes clients who don’t leave.
  2. Transformation to a new client service standard—As clients embrace this new standard, they will become more and more engaged and excited about it, triggering conversations around how your firm can help them further.
  3. Evolution of clients to advocates—A recent statistic showed that between 50 and 91 percent of all new business generated is the result of word of mouth. With a richer client service experience, the client role will evolve into one of firm advocacy.

I firmly believe that rising competition and ongoing disruption in the profession does not have to affect us negatively. There will always be plenty of business for firms in the vanguard of the profession.

To take a true proactive role in your clients’ lives, it’s time to move past the evident needs and dig deeper. For example, the need for such services as payroll, tax return preparation and accurate bookkeeping is often a given. Clients are simply buying the standard services they know they need. But this means that we are not getting to their wants—that is, the deeper and more impactful advisory support. This requires us to ask questions. Does the client really only want tax preparation, or do they desire a deeper understanding of their overall tax situation? Do they want more guidance on how to save for retirement or their kids’ college funds? Until you dig deeper, you’ll never know…and you’ll never be able to work with clients in a proactive manner.

According to Horst Schulze, clients want three things from us:

  1. No defects: Clients want a product or service with no defects. This means they expect quality at all times. They want to be able to count on us without pause. This includes both the products and services we offer as well as the overall client experience. 
  2. Individualization and personalization: In a world where firms are standardizing processes and procedures, clients still crave a personal feel. Technology allows us to standardize while also personalizing the client experience. This can be as simple as acknowledging a client by name to pinpointing their preferences, situation and goals in order to offer an individualized, personalized solution.
  3. Awareness of changing customer expectations and preferences: There was a time when clients wanted to stop by the office and pick up paper documents. Today, client preferences have changed and we have to adapt. Now, it’s all about convenience…cloud-based apps, digital documents and instant access are what clients want and expect. And soon it may be artificial intelligence.

We are living in a new era, where client expectations are ever-changing…where public discourse is often antagonistic…and where people are more concerned about their futures. But with advanced technologies and a new mindset entrenched in modern elegance and proactive support, we are well-positioned to serve clients better than ever. To be ladies and gentlemen serving ladies and gentlemen.

All my best,

Have you heard our Better Every Day podcast yet? Subscribe on iTunes or listen from our website at rootworks.com/podcast for a deeper dive on the topics discussed in this column.

End-of-year priority list

 By Leah, Education Team

Welcome to the last month of 2019! By this time of the year, your firm has already started thinking ahead to next year and has likely been cranking through the priority list established earlier. There are so many things to get done between now and the end of the year. Below you will find common items firms are working on this month. Check them out to see if there are any items that you still need to think through and act on.

Turning services into products

Many firms are trying to standardize their services into product bundles. This step creates a significant amount of clarity within the firm. Here are some reasons why you should be considering this if you have not already:

  • Processes will be standardized
  • Staff will understand what services to perform for clients, instead of it being all over the board based on what the client has defined they need
  • Clients will have a better understanding of what services will be provided
  • Prospects will have a better understanding of what the firm offers
  • The firm will generate more recurring revenue

If you have already created product bundles, this is the perfect time of year to start discussing them with existing clients to migrate them into a product for the new year.

If you are a Rootworks member, check out the applicable resources in the Online Learning area of rootworks.com.

Engagement letters 

Now is a common time for firms to renew their engagements with clients for the upcoming year. Here are some considerations as you think through your firm’s engagement letters.

  • How often does your firm send engagement letters? If the answer is never, now is a good time to start. Annual engagement letters allow you to evaluate fees and services every year. 
  • Does your firm have all engagement letter renewals on the same cycle? Having to remember which clients renew in which months can be painful. Consider extending those engagements to be 12+ months to get everyone on the same renewal cycle.
  • What is included in the engagement? Do you have clients that could benefit from additional services? Have you recently created product bundles that a client should be in? This is a great time to evaluate the services that are being provided to your clients and determine if additional services are applicable.

If you are a Rootworks member, check out the engagement letter examples that exist in the Online Learning area of rootworks.com.

Fee increases

Are your firm’s fees too low? There are many firms that have not raised their fees in years. The knowledge that your firm possesses and uses to service your clients is very valuable. Raise those fees! Here are some considerations as you think through raising fees:

  • It is okay to raise your fees!
  • Decide the percentage increase range you need to be at to reach your firm’s goals
  • Plan the communication to coincide with your year-end communication or to exist in the engagement letter that is sent to clients
  • Establish your firm’s new minimum fee for new clients and make sure it is higher than last year’s

If you are a Rootworks member, check out the fee increase examples in the Online Learning area of rootworks.com.

Are your data backups worthless?

By Chris Dickens, IT

According to a blogpost by SherWeb, the average failure rate of backing up all data is 75 percent. So, three out of every four backup solutions out there are failing, and the odds of a full recovery after a failure or a data breach is only 25 percent at best. 

Fortunately, this is a statistic that is preventable for the average business, and the fix is inexpensive and easy. Here it is:


If you’ve not gone through a disaster recovery drill in your firm, now is a great time to conduct a test to verify the integrity of your data backups. Work with your IT Services firm to run a disaster recovery drill in order to answer these three important questions:

  1. Are your backups good?
  2. Can you recover all data?
  3. What is your recovery time from a total loss?

Going through this process once or twice a year can prevent you from experiencing data loss when an actual security or failure incident occurs. It can also guide strategic decisions concerning disaster response and business continuity plans, as you will know your recovery timelines and the true cost of a loss of production by your firm. 

Finally, if you have data in cloud solutions, you need to understand what their data recovery and retention policies cover. If these do not suffice for your firm, you should consider supplementing their base level protections with additional backup solutions. 

Turning prospects into long-lasting clients

By Chris, Marketing Team

A meaningful, long-lasting relationship of any kind starts with getting to know someone and having their best interest in mind while gradually building trust. This also applies to turning prospects into long-lasting clients. It doesn’t happen overnight, and understanding the process will help you cultivate client relationships that will stand the test of time. 

Think of it as a process that involves the following milestones:

Awareness: It all starts here. Awareness is simply a matter of consistent exposure that helps to build credibility over time. Build your brand awareness by delivering consistent and effective messaging and useful content to your prospects so that they develop familiarity, gain basic knowledge on what you offer and how it will benefit their lives.  

Educate: You want to be sure potential clients get the right information from you at the right time. The content you deliver needs to focus on anticipating questions and providing clear, easy-to-access answers. Your website is the hub of content at this stage. How are your services presented—are they “productized” in a way that’s easy for prospective clients to understand and self-select? 

Purchase: When a prospect turns into a client, the nurturing doesn’t stop there. Be sure to shape an outstanding experience and positive reinforcement for your clients. Be proactive and reach out with periodic reminders about filing deadlines, planning and other client updates. Remember, you are an educator and trusted advisor, and your clients will look to you for advice and guidance. And most importantly, remember to express appreciation for their trust and their business on a regular basis. 

Satisfaction/Advocacy: When you deliver an excellent client experience (which all starts with building awareness), your clients will become your best referral sources. There’s nothing more powerful than the testimony of a happy client.

I encourage you to examine your firm’s process for converting prospects to clients. Then, focus on creating an excellent client experience that will stand the test of time. 


Rootworks has a new relationship with Tech Guru—techguruit.com. Tech Guru IT is a premier IT services and consulting company that specifically serves CPAs and accounting firms—bringing to the table a deep knowledge of accounting firm solutions and how different tools impact firm workflows.

Rootworks members can schedule a complimentary 90-minute cloud and security planning session.

Find more information in Rootworks.com under Learn > Vendor Info. Click the Tech Guru logo.

Upcoming Webinars for December

  • December 13 – Staff Training: 1099 Strategy & Use. Learn best practices for managing 1099s in the firm. This includes communicating with clients and defining the roles and responsibilities for this service. We will also cover processing 1099s in Thomson Reuters ACS and Tax1099.com at a high level.
  • December 18 – Staff Training: Getting Ready for Busy Season Part 1 of 2. This class is designed to get your firm ready for tax season. This includes necessary clean up and recommended settings in software applications. A walk through of the organizer process will also be covered in this session. Overall strategies will be discussed that can be applied to any software your firm is using, but specific software reviewed in this class will include Practice CS and UltraTax CS. This is Part 1 of a 2-part class. This is a 90-minute class.
  • December 19 – Fall Resource Update Webinar. The Resource Update webinar reviews and explains all newly added or updated items in Rootworks.com.
  • December 20 – Using the new Rootworks.com. We will cover the new Rootworks.com interface, including:
    • New layout and navigation
    • Updates to ClientView, including the Insights report, significant updates to client data that you can track, and new filtering options

Register in Rootworks.com under Learn > Events.


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