Why Change Management is Critical for Your Firm’s Future

September 27, 2021

What is change management?

Change management is exactly as it sounds: a process that helps your organization effectively enact a change. Change management is especially crucial for an organizational IT change. It not only minimizes risks and disruptions, but it makes sure everyone is on the same page and feels comfortable with transitions.

When it comes to smaller firms, those in leadership are often the most important change management leaders. Unfortunately, they also tend to be the most resistant to change.

The “burning platform”

Small to medium sized accounting firms often get stuck in “burning platform” mode. According to Inc. magazine, the “burning platform” idea refers to an oil rig; when it’s on fire and there’s nowhere to go, your only move is to jump.

For firms lagging behind on tech innovation, it’s easy to get complacent and not realize the fire slowly breaking out. You’re making money and your peers don’t seem to be embracing change, so things are okay, right?

But it’s easier to get off the rig if jumping isn’t your only choice. It’s even easier if the fire never starts at all. Being forced to jump as your only option makes it easy to resent change. You’re scrambling to survive instead of developing and enacting a thoughtful plan that makes change easier on everyone.

That’s why now is the time to assess, ideate, explore, and experiment.

The problem with not changing

Change is challenging. We’re programmed to love the comfort zone and maintain the status quo. But not changing presents even more risks.

It wasn’t long ago that tools like Quickbooks were disrupting the industry and replacing ledger books and hand calculations. If your firm was around in the 1980s when accounting software was just starting out, chances are someone (or multiple someones) clung to their ways of doing things and thought it was a just fad that would fade with time. Can you imagine an accounting firm now that didn’t adapt to the existence of Quickbooks, Xero, and other solutions?

As the speed of technology continues to increase the more you need to embrace change.

A 2018 Accounting Today article notes that many in the field incorrectly expect industry changes—mostly fueled by technologies like big data, AI, and blockchain—to happen over the course of the decade. Experts assert the change is not going to be that slow, and those unprepared will be caught off guard, a detrimental situation for their firm. This means:
  • Services could lack relevance to clients and firms may be unable to pivot to those services clients seek. Traditional services like tax preparation, compliance, and audits are going to fade as technology makes it easier than ever for these services to be handled either internally by the client or at a lower cost by firms. Consulting and advisory services that make a firm a “one stop shop” for all things financial are the number one way firms are going to move forward.
  • There could be an inability to compete. There’s no way around it: The small and medium sized firms who embrace technology and innovate services will dominate the market. Those who stick to the traditional will lose clients and stop attracting new ones.
  • A declining business valuation. Your firm often isn’t worth what you think it is. If retirement is on your radar in the next 5–10 years and you’re seeking to sell, not keeping up with industry changes means you’ve lost significant value.
As we continue to move deeper into the 2020s and sit at the cusp of 5G innovation, it’s no longer hyperbole to say technology adaptation will be the make or break for the industry.

A new change management culture

Driving true change in your firm requires a cultural approach on two fronts:
  • You need a culture that prioritizes urgency and action over big vision ideas that are applauded but then forgotten. Too often an organization embraces the romance of change but isn’t invested in the hard work. In order to survive and thrive, leadership needs to make sure action is taken. It’s not just about what you should do, but about what you have to do to remain relevant and successful.
  • You need a culture that doesn’t focus on the negatives of change. There’s no way around it: change can feel hard and disruptive. Firm leaders often find themselves stuck on how change can be problematic instead of looking at the big picture benefits. An effective change management structure aims to minimize problems and disruptions and make change work for your organization.
When these cultural attitudes are in place, change is less about being reactive and more about embracing possibility. Leadership attitude is critical in not only making these cultures possible but in gaining employee buy-in for the change. It’s easier to overhaul an outdated system when everyone is enthusiastic about the results.

Building a change management plan

A change management plan will guide your tech transformation and help make it as approachable as possible. Not sure where to start? These guiding questions will help.
  • Develop your vision. What are the key reasons behind the change? What goals will they achieve? How will they impact your firm for the good? (See more tech transformation questions to consider here.)
  • Assign roles. Who will lead the change? What other leader roles are needed and who will fill them? What is everyone’s role in the change process?
  • Build a calendar. When will the change process start? What are the key steps along the way, and how will various team members play a role? When will training take place, and who will provide it? Who needs the training? What communication check points are needed along the way to keep all stakeholders involved in the process?
  • Create a communications process. How will you collect feedback and problems? How will requests be handled? How will you track all changes made, including updates and fixes? Will there be a log of tracked progress, and where will it live? How will you share key milestones, including successes and goal achievements after change has been enacted?

 

This article was shared by the Indiana CPA Society. 

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