Next and (hopefully) up: why succession planning is so important for accountants

In your drive toward greater success, it’s empty chairs – above all else – that cause your worst nightmares.

I’m talking, specifically, about the chair in which a critical person sits. The kind of person you rely on day in and day out. The face that was part of every good morning greeting until one day… it wasn’t. They are gone.

You regret not finding a way to make them stick around. But in this scenario, other regret is gnawing at you: you didn’t establish a staff succession plan. Maybe you didn’t expect something like that to happen to them.

This has consequences. Once this important staff member left, things started to unravel. Processes stall, clients lose trust, morale declines, and costs plummet.

PART ONE – Why every “A Team” needs a staff transition plan

In all companies, there are staff who have extra strategic or operational burdens.

Think about the roles that form the basis of your client relationships: partner, director, senior accountant, payroll manager, bookkeeper – the list goes on. They do a great job, your clients know their name, and you’ll be in trouble if they leave.

The hidden weakness of a great staff

Star players will have to bear the consequences if they are not tracked. For every good thing you see them accomplish, there is often some work done out of sight. This is often because they are independent people with their own way of doing things, or they are willing to quietly support a colleague.

Sometimes, it’s a mix of both.

This backfires when they leave. If neither of you keeps track of their work, those fine details probably won’t be included in any handover documents. The foundation disappears from under the company because they don’t know what tasks and processes need to be done.

Inevitably, clients start to see gaps in your operations. As we will see, this happens when your company has provided notification, either verbally or not.

Bottom line: when a great staff member leaves, it can devastate your payroll

Partners and senior staff set rates, and when they leave, the ability to charge those fees is suddenly threatened. Key staff members build relationships with clients through good times and bad, meaning that when invoices are sent, they are paid.

Now that the staff member is gone, the respect and trust they earned in your company diminishes over time. Make no mistake, clients are not happy when they hear this news.

Of course, this scenario scales based on your staff member’s former client list. So how many people do they help? Is it 10, 50, or even 100 clients?

As I said, empty seats cause the worst nightmares.

The problem doesn’t stop with senior staff

Of course, important people are not just at the “top.”

I’m also thinking about those who handle large tasks, like payroll or bookkeeping. These staff members store a lot of information in their heads, on their desktops, and through a constant chain of client communications. Some of these communications can be emails, but they can also be phone messages or important meetings. If you can see the messages, they may be confusing – staff members and clients are often so in sync that they will short-score and refer to events that you are not aware of.

Again, imagine how that client will feel when that key staff member leaves. Time is running out, and you have to prove that your remaining staff members can deliver. You must maintain client trust.

Domino effect – will more people drop out?

A great staff commands respect as well as expense. They are natural leaders, whatever their position. This means that when they resign, your company morale will take a hit. The question is “how much?”

Key staff members provided examples that could be applied to their decision to work elsewhere. People will look at the state of affairs at your company and wonder if the grass is greener elsewhere.

Like your clients, your remaining staff will also start to worry that the good times are over. They will ask: will there be a replacement, and is there any point? Should they stick around to find out?

PART TWO – Rapid succession planning for accountants: how to reduce your company’s risk

Start by identifying risk points. In other words, who, if they leave now, will inadvertently damage your company?

Possible candidates include:

• Partners – processes and data flow to these leaders, but because they are busy, it is not always shared appropriately.
• Team leader looking after a specific client.
• People who spend a lot of time on the road meeting clients, including accountants and more senior specialists.
• “Doers” who do more than others because they have experience. They may include junior staff as well as more senior colleagues.

Have you seen the pattern? As a leader in the company, you can see the money these people are making and occasionally meet their satisfied clients – but you can’t track the process. In other words, you don’t know how the miracle happened.

Prevent problems

Once you have identified these key staff, you need to understand their processes better. Help them unload their workload, job by job, task by task. People of this caliber rarely appreciate how much they do. Document every effort they make, and you’ll find out a lot more than you expected.

Next, take this workflow and turn it into a live overview that can be shared. Everything needs to be tracked in a way that every appropriate team member can understand. Going forward, this means no dedicated spreadsheets that can only be interpreted by one member of staff. This means no “quick” work is done for clients that don’t get caught.

Approach this exercise wisely. Never think of it as “we don’t know what you do, so we need to write it down” or “we’re worried you’ll leave, so we want to capture every bit of information we can.” Instead, use this as an opportunity to make sure they’re not doing unpaid work – and also as an opportunity to see where other staff can help them.

If approached correctly, this is an exercise that will thank important staff members. Maybe it will even stop them looking for another job someday.

The secret ingredient

Practice management software (also called task management software) can help you capture and track complex work. This will also save staff from having to track progress using ad-hoc spreadsheets.

What’s good for succession planning is also good for every scenario. If a key staff member is away, sick or on leave, colleagues will be able to provide support to them and their clients.

Consider standardizing your compliance software if you haven’t already

If staff use different software to accomplish the same thing, it will be difficult to pick up the slack if someone leaves.

Look at the core tasks and make sure everyone is using the same software. If there are outliers, get them licensed and make sure they are trained to be familiar with your standard solution.

Success through succession – the final step to avoiding disaster

When someone who is key to the company leaves, always provide staff with information (if necessary) regarding the succession plan. Let them know you’re hiring, and give them a date after the contract is signed. If there is an interim, let the team know how tasks will be distributed.

This may be a good time to discuss a pay increase to recognize the hard work your team puts in, with the assurance that any additional responsibilities will be delegated once new staff members arrive.

During interim periods, some tasks may get lost because people take on more work than they should. You can help manage this by using practice management software to support the team – missed tasks can always be flagged and redirected. That way, everyone feels calm.

A smart way to future-proof your company

You’ve seen how vulnerable your company is when key staff leave. That means you need a system that covers work, standardizes processes, and supports your team through any transition.

IRIS Cloud Accountancy Suite includes powerful practice management modules as well as high-quality compliance tools. This helps you:

• Track every task in real-time – so no work is lost during staff changes.
• Standardize compliance across your team, with seamless handovers.
• Use advanced analytics to identify bottlenecks, missed tasks, and opportunities to improve efficiency.