The goal for every accounting firm owner should be to build an organization that is not dependent on the founder or any one person. If one person is responsible for so much, what happens if that person leaves? If you have turnover, it will take months to sort out what that person was responsible for and how to replace their work. Vulnerable to threats: In a partnership model, an organization is too person-dependent, and that brings risk. This commonly causes an organization to stagnate around $1M in revenue per partner, Ed says. Growing the business means more work, more headaches, and more complexities when overseeing everything. Stagnant growth: For many accounting firm owners, growth is associated with pain. When a founder needs to have a say in every decision, the business is stifled and unable to move quickly. Inefficient decision-making: Even though someone has started the company, it does not make them the best expert at marketing, sales, and operations. But they don't have the expertise or the bandwidth. “Most founders want to be across every decision. The organization is dependent on people, not on systems and carries damaging consequences. They bill out their time on client work and simultaneously guide operations, accounting, and marketing. The typical structure, Ed describes, is a partnership model, which has nothing to do with the legal structure of the entity, but describes the roles in the company.Ī partnership model is where the founders are heavily involved in all aspects of the business. The reason many accounting firm owners get trapped is because of their business structure. The problem with traditional accounting organizations In a recent Karbon webinar, Ed shared how he built a business where he could achieve freedom and scalable growth. He achieved this by building a scalable organization structure, designed to run without him. Today, he acts as Non-Executive Chairman and has distanced himself from the day-to-day operations while still earning a passive income. It is easy to become trapped, knowing that so much responsibility rests on your shoulders just to keep the wheels turning.Įd Chan co-founded Chan & Naylor in 1990, which has since grown into one of Australia’s most successful accounting practices. While owning your own accounting firm promises freedom, you can often feel like a prisoner of your own business.
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