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October ’19

Ideas for the journey to better every day.

October ’19

Does the coffee shop sell coffee? How lack of clarity can be an enterprise killer…

By Darren Root, CEO

As you read the intro to this article, you might start to think I have too much time on my hands—just thinking about if coffee shops know they sell coffee. But, bear with me. I have a point—a crystal clear point to make. 

As a dedicated coffee drinker, I’m a frequent patron of my local Starbucks. Now there’s a company that has operations down to a science—with a clear focus on what they sell and how they deliver products. This got me thinking. What would the challenges be for coffee shop owners who don’t have clarity on the products they sell?

  • How would they properly train employees to meet customer needs? 
  • How would they know what equipment is necessary to support operations?
  • How would customers know what is offered?
  • How would the company market to their ideal customers?

Certainly, if someone opens a coffee shop, by default they should know that they sell coffee. But, does that mean they also sell lattes, cappuccinos, pastries? Not necessarily, right? 

The point? Even for a business as “simple” as a coffee shop, it’s critical to have clarity around products offered. Just as it’s critical for accounting firm owners to be clear on the products they offer in order to be effective at all levels of operation—from staff training and marketing to product delivery and client experience.

So, the question is: Do you really know what you sell? If not, you may face many of the same challenges presented in the coffee shop example above. How can you possibly educate your staff so everyone is on the same page? How do you market your products to your ideal clients? How will your clients know what your products are? And how can you deliver a premium client experience if you don’t know what products your clients need?

The fact is that for too long firms have fallen victim to lack of clarity—the biggest killer of enterprise. 

Clarity is an ongoing quest 

Many firms might say that they’ve always had clarity around what they sell, simply because they’ve been selling the same thing for years—bookkeeping, payroll and tax preparation. Make no mistake, this is indeed clear, but clarity is not stagnant. Firms have to change with the times and continue to define what they offer based on the market, trends and what clients truly need. Clarity is an ongoing journey.

Take for example the norm: Your products are bookkeeping, payroll and tax prep. First, these are all compliance products, which take the most time to support and are offered by the majority of firms across the country. Second, consider the growing threat of “big box” competition such as Bench.co or Pilot. These companies are offering outsourced compliance services at an exceptionally low cost and, reportedly, with higher levels of convenience. 

With all the competition for compliance services, it’s time to redefine offerings. It’s time to get clarity on what it would look like to productize advisory services as well. Think about it, and then imagine the positive impact of productizing every solution you offer.

  • Standardized staff training across departments and roles—Create “off-the-shelf” training to quickly educate current and incoming staff on your product offerings. For example, if you offer a retirement plan product, once staff are trained, any one of them can support the client. 
  • Standardized technology—When you accomplish clarity on the products offered, it’s easy to identify the tools needed to support a given product. It’s even likely that the client technologies you have in place today could support operations. But also consider added tools that streamline product management and the ability to easily share product information among team members.
  • Standardized marketing and sales processes—Imagine how simplified marketing and sales can be when you know exactly what you offer and who your ideal clients are. 

Moving from reactive to proactive operations—Client data is key

For as long as I can remember, accounting firm owners have operated with a reactive client service mindset. Simply put, this means waiting for the client to come to you with needs and then you respond. This type of business model also means you reinvent products and services with each client’s request. And that is no way to operate. Only when you have clarity around products can you anticipate client needs and then go to market with the products they truly need.

Moving away from the all-too-common reactive model takes time. It also takes data! Because how can you really know what your clients need unless you know more about them? Get the data and clarity will follow. 

For brand giants like Amazon, Etsy and Apple, customer data is constantly captured. These companies are collecting data on buying habits, frequency of purchases and more. In one case study I read recently, a retail store used mounted video cameras with facial recognition to capture a buyer’s every move while on premise—including brand interest, time spent in certain departments and purchases. Creepy? Yes. But this level of data, combined with online browser history, allowed the retailer to pinpoint client interests and market with laser focus. 

So, if data is really that valuable (and we know it is), what opportunities are firms missing to better service clients by ignoring data that passes through the business every day? 

This is where clarity comes back into the story. When we have clarity around our clients’ needs, we can then define products that they truly need—products that serve to foster business growth and long-term prosperity. It’s not about selling more stuff…it’s about selling the right products to enhance client relationships. But to get there, you need data.

The fact is, we all have tons of client data that can help us better understand our clients’ needs—to move away from a reactive to a proactive business model. The problem is that most of this data is in our heads. Consider just a few data points you might have on a client:

  • The client has or does not have a retirement plan or a buy/sell agreement.
  • The client does or does not use QuickBooks Online, Zoom, Slack or other helpful technologies.
  • The client is set up as an LLC or a Corporation.
  • The interest rate the client is paying on a business loan.

Likely, there are a hundred more data points like these examples. If you could capture all data points in a single space, just imagine the clarity! Just imagine how much easier it would be to support clients with much-needed advisory products.

For example, if you had a way to aggregate data, you could identify that a client does not have a retirement plan in place. Because you’ve clearly defined your products, you have a “packaged” retirement plan product you can offer the client (proactive vs. reactive). Or, imagine you identify that the client is still using QuickBooks Desktop. You could then proactively move the client into your firm’s preferred and recommended technology ecosystem, which likely includes QuickBooks Online. 

There are numerous other examples of how data can clarify a client’s needs, and ways your firm can easily support clients with productized offerings…beyond standard compliance services. And this all serves to enhance the client experience to an unprecedented level.

Data is the bridge to advisory services inside an accounting firm, and it is the key to enabling a proactive business model and getting to a true state of clarity. If it’s been awhile since you’ve evaluated your product set, you may not be as clear on your clients’ needs as you think.

This is a big paradigm shift. It requires a shift to dedicated data collection. A shift from a reactive to a proactive client experience mindset. A shift from being a heads-down compliance services technician to a modern-thinking advisory services entrepreneur. All of this can be a reality when you make clarity a priority in your firm.

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.

Opportunities are here…

 By sean, Education Team

The September 15 extension deadline has passed, and soon we will get by the October 15 deadline. If your firm is still doing too many tax returns on extension, it is now time to re-evaluate and make changes to the business model that fosters or creates having so many extensions.

Once you get past the October 15 deadline, your focus (other than year-end tax planning) should be on making positive firm changes before the end of the year. Our Education Team at Rootworks is helping many firms make positive changes now, but traditionally the 4th quarter is a huge time for firms to make changes.  

When you think about what’s going on in the firm, document the things that cause you the most pain. Keep a running list. Use OneNote, Google, Evernote, etc. to compile those items and meet as a firm to decide the priorities and things that can be done along with a deadline for those items.

We have common projects that firms work on in the 4th quarter. If one of these is on your list, we have the resources and coaching available (if your membership includes coaching) to expedite the implementation.  

Common Projects:

  1. Revise your tax workflow
    • Create levels for your returns. If experienced staff are doing returns, is a review necessary?
    • Add Audit Protection to your tax process.
    • Refine communication and billing strategies for tax returns to eliminate too many touches.
    • Use a tool to scan up-front. This will allow staff to be free of working from a paper folder.
  2. Refine your workflow tools (project management)
    • Are all the steps you currently track needed?
    • Have you made the program too complex?
    • Is the solution you are using just not getting the job done?
  3. Determine and implement the tool that is right for your firm to communicate with clients
    • This isn’t a one-size-fits-all bucket. We consult with firms daily on the best solution for them.
  4. Turn annual clients into Monthly/Quarterly clients
    • If tax season is painful, this is the solution. Move clients in the firm to be worked on Monthly or Quarterly instead of Annually.
    • If a client doesn’t want to be Monthly or Quarterly, then ask yourself this: “Is this my ideal client?” If the answer is, “No,” then find one that will be an ideal client.

Rootworks has the tools and experience to help your firm make positive changes. It just takes a bit of commitment. Things don’t have to be the way they always have been.

CEO fraud phishing continues to grow

By Chris Dickens, IT

Business Email Compromise (BEC) scams are continuing to grow, and CEO fraud continues to be one of the more popular types of BECs out there. After all, if you get an email from your boss, would you ignore it? Cybercriminals are finding that many people would not ignore it, and will respond. 

The Better Business Bureau reports that this type of phishing attempt is up 50% this year over last year, and has tripled over the past three years.

Knowing your red flags and how to process all email is the best defense in preventing staff from falling victim to these types of scams.

In the real-life example below, which was received by a Rootworks employee, the red flags are circled.

  1. FROM email address reads as our CEO, but the email address clearly is not his email address.
  2. SUBJECT creates a sense of urgency.
  3. BODY of email contains language not consistent with the person being imitated. John also knows that Darren has his mobile number.


Of course, a socially engineering aware staff member will recognize this scam, and will also verify before acting. Verifying can including calling, texting or Slacking the CEO to inquire about the email to verify authenticity.

Finally, if the authenticity of the email cannot be proven, one should delete and move on.

For more information on BEC type attacks, download the Better Business Bureau report.


Most important part of your marketing efforts

By Chris, Marketing Team

Last month, we covered the basics of diversifying your marketing efforts and mapping out your marketing goals. Now, I’d like to explore the most important part of your marketing efforts: your prospect lists. When obtaining prospect lists, you have the following options:

  • Build the list yourself: Although it requires a lot of legwork, it will be a well vetted list. You can aggregate prospects through your referral sources, community events and personal outreach. You will need to provide a mechanism for people to opt into your list such as a sign-up sheet, fishbowl to collect business cards, etc.
  • Buy a list: There are many list brokers who specialize in providing email lists for direct marketers. Our preferred list vendor, Caldwell, is one example. A purchased list allows you to target a larger geographic area, niche and other target measures. Be aware, that most ESPs prohibit using purchased lists. If you get a list with a high bounce rate, unsubscribes, etc., it might raise red flags. Therefore, I recommend having your list “scrubbed” before sending out emails, which will improve deliverability. This is an additional service that Caldwell offers. 
  • Client prospects: Don’t forget about your clients who meet criteria for up-selling. Since they already have a relationship with you, they are your low-hanging fruit, so you will want to segment those clients into a separate list for marketing.

Remember, marketing is a numbers game. If you don’t see results immediately, do not get discouraged. Marketing stats show it takes 10 to 12 impressions before a prospect takes action. Action requires familiarity, and that occurs over a longer period. 

Webinars for October

  • October 1 – Member Led: Using the First Time Penalty Abatement. If you missed it, you can watch the recording in Online Learning.
  • October 2 – Staff Training: Proposable Best Practices. If you missed it, you can watch the recording in Online Learning.
  • October 17 – Fall Planning Webinar. Planning webinars are time spent working on your business. Use each session as a checkpoint throughout the year. Take time away from day-to-day work to celebrate accomplishments, think through projects and issues, and plan out your future objectives. 
  • October 18 – Staff Training: Onvio Practice Management. If your firm is considering implementing, beginning the implementation, or looking into implement Onvio for time & billing or project or task management, this session is for you. This session will cover the Rootworks Best Practices for setting up Services, Activities, Projects and Tasks, as well as many other items that are part of these applications.
  • October 23 – Staff Training: Tax Products: Creation and Communication. Rootworks advocates turning your services into products; in other words, ‘productizing’ your services to create standard product offerings that you market, sell and, of course, deliver. Productizing tax services into products can be a natural progression of turning your services into products following the Rootworks model. In this staff training, we will introduce the idea of having tax products in your firm—what they are, what the benefits are to the firm and to your clients, as well as communicating your strategy internally and externally.
  • October 30 – Fall Cybersecurity Webinar. We’ll continue our conversation on cybersecurity and keep firms apprised of new threats that we are seeing and what can be done to help keep firms safer.

Register in Rootworks.com under Learn > Events.


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