Most of us think of our CPA as somebody who just does taxes, bookkeeping and audits, but they're actually in a unique position to help just about any company optimize it’s performance.
How?
By combining data-driven analysis with experience-driven insights.
What most companies want is a way to make smart decisions that will help them maximize strengths, strengthen weaknesses, leverage opportunities and counter threats.
As best-selling author Jim Collins said, "All Good to Great companies began the process of finding a path to greatness by confronting the brutal facts about the reality of their business.”
He calls them “brutal facts” because when you do this kind of comparative analysis right, it doesn’t hold anything back. Sometimes it feels like a big, wet kiss, sometimes it feels like a punch in the face.
CPAs have three key advantages when it comes to helping companies do this kind of objective self-examination:
- Trust
- Impartiality
- Expertise
Trust is important because there are plenty of “Backseat Drivers” and “Monday-morning Quarterbacks" who don’t understand that being a CEO means making bets, trade-offs and fuzzy choices that don’t always work out the way they’re supposed to.
Because egos are involved, everybody has to feel comfortable being open, honest and transparent, otherwise the process fails.
To quote Collins again, "When you start with an honest and diligent effort to determine the truth of your situation, the right decisions often become self-evident.”
An already-established relationship makes this not only easier, but faster.
Related to trust is impartiality. The fact that an accounting firm is a (mostly) neutral party is critical because it — along with the use of good, solid sources of comparative data — can help overcome “Emperor’s New Clothes” situations that sometimes beset performance-oriented companies that try to do this kind of thing on their own.
(Warren Buffet has a great quote that’s kind of related to this problem: "Only when the tide goes out do you discover who's been swimming naked.”)
Last, and most important, is expertise.
As VC Ron Bekkerman said, “In the modern world, data is business. You can no longer think business without thinking data.”
Few people are as familiar with the raw stream of performance data that flows in and out of a company as its CPA, which means the same skills he or she uses making sense of it for taxes, audits and certified financials could (and should) be applied to a much broader range of performance-related projects.
If you want to improve your peformance, talk to your CPA about benchmaring.
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