Firms are hoping to develop enduring client relationships and increase profit by providing client advisory services. To increase the chance of success, there's a critical piece that needs to be included with those services — client education.
The amount of value clients receive from CAS offerings is diminished when the client doesn't understand "the language of business." Think about the times when someone in a different industry explained a totally foreign concept to you. It likely made sense if they explained it in lay terms. But did you understand it? Probably not. I call it the bobblehead doll syndrome. It's the same thing with your clients — they hear what you're saying, but can't operationalize the guidance because they don't understand it.
What do I mean by "client education?" At a minimum, firms should provide basic financial and managerial accounting education — enough for clients to thoroughly understand their own business.
Business doesn't operate in a vacuum, so other beneficial offerings could include:
- Organizational theory/development/structure/culture;
- Decision-making, planning, and strategy;
- External analysis (Porter's 5 Forces);
- Governance, ethics, fraud prevention; and,
- ESG (Scope 3 reporting)
Education can be an e-newsletter, micro-learning, industry-specific training or a series of self-study short courses. Your client education program can be customized in a variety of ways.
Here are five reasons for adding client education to CAS:
- Clients don't understand accounting and other essential business concepts well enough, which dilutes the value of the services you're providing. If they don't see the value of your services, they're less likely to retain them long-term.
- When clients leverage business knowledge that you provided to grow and become more profitable, the firm wins because the client needs and wants more of your services.
- Implementing client education differentiates you from the competition.
- Firm staff can simultaneously refresh or grow their knowledge of key business concepts. Use the program to enhance and supplement leadership development training.
- If CPA firms don't educate clients, someone else will. Upskilling is in high demand. Technology will replace a lot over the coming years, but not the need to understand the fundamentals.
It takes commitment and planning to get client education up and running, but the annual cost can be less than one staff accountant.
Don't sell the basic education — include it in your pricing. More in-depth education is beneficial enough to warrant a fee. Many fundamental accounting and management lessons are static (the basic accounting equation has been around since 1494), and easy to reuse. Done correctly, firms can provide a wealth of targeted, custom education to clients and staff for less than the monthly cost per person of the more popular learning subscriptions. Those tools are great (and profitable!), but they can be overwhelming and frustrating. Clients don't know what they need to learn or where to start. There're so many options that it can be difficult to find exactly what you need. Firm provided client education is a more personalized, boutique solution.
I've worked in and around accounting long enough to remember CPA firms offering outsourced and back-office type services in the past. It sounds great, but clients who use these services can be messy, inefficient, and time consuming. Engagements that should be profitable become more of a hassle than they're worth. Unwinding the services is an expensive waste of finite resources, and not a good look for the firm. A small investment in client education reduces time spent on clients, bridges critical knowledge gaps, and helps ensure long-term viability.
