As technology marches on the traditional ground of accountants, a common argument is emerging: accountants need to move into ‘high-value’ advisory.
There have always been problems with this.
Accountants are trained in accounting, tax and often some form of management accounting. They understand the numbers, but that doesn’t automatically make them great at ‘advisory’. Many would rather spend their time preparing and understanding accounts, rather than selling advice and taking the responsibility that comes with it.
So, how can one improve their advisory skillset?
An expert in advisory needs to master three main areas – relevant information, context and empathy.
You need to start with relevant information.
Most accountants are trained to provide accurate information, yet keeping this information relevant may provide more of a challenge. For example, telling a business owner their GP has fallen from 50% to 42% may be accurate, but where does this hold relevance to the client?
The key lies in context.
Let’s take an example where direct costs have risen dramatically due to increased staffing costs (this would certainly be true for many service industries). Informing a business owner their GP has fallen could come across as disheartening, unless you can support their analysis of the cause and work collaboratively towards a solution.
Understanding the context behind your information deepens the conversation beyond the stated facts. Staffing costs have risen dramatically – what advice can you, as their accountant, provide in this situation?
You could start to explore opportunities to increase GP with your client in a systematised way. You may not know the correct solution at this point, but you can put together a framework for the client to find the answer. You can support them with further analyses and be their sounding board. Together, you can find a way.
This is where empathy comes in.
Fundamentally, this conversation cannot be meaningful or productive without empathy. You need to know what your client is thinking (and feeling) in order to hold a potentially challenging conversation and keep them in a positive, problem-solving space.
If your client is stressed because they are losing money, it’s important to understand this and keep things calm so you can work together on creative solutions. After all, it’s difficult to think clearly when under severe stress.
Any accountant can provide information. By keeping the relevant context and lending an empathetic ear, you’ll be able to provide consistent, expert advisory, and have the confidence that comes with it.