By Ron Baker
I always ask audiences if they'd rather have an efficient or an effective surgeon, where efficiency is defined as doing things right – and is a measurement of outputs divided by inputs – while effectiveness is doing the right thing – requiring a judgment. Most CPAs say they want both.
But I argue that effectiveness should be the talisman in your accounting firm, not efficiency. This in no way implies that making certain processes and procedures more efficient isn't a worthy objective, but that should not be the overriding goal of a Professional Knowledge Firm (PKF). Judgment is far more important than measurement in a PKF.
A business isn't paid to be efficient; it's paid to create value. The buggy whip manufacturers were a model of efficiency. So what? What if you're efficient at doing the wrong things? Management thinker Peter Drucker believed there was nothing more useless.
I recently read Management Lessons From Mayo Clinic, by Leonard L. Berry and Kent D. Seltman. The former author is a scholar I respect tremendously for his prior books on customer service. [All references and page numbers in this review are from the hardcover edition of the book].
The book is an interesting read, and supports our hypothesis here at VeraSage that effectiveness is the ultimate North Star of a PKF.
Effectiveness at Mayo Clinic
Here are some examples of Mayo's commitment to effectiveness through creating an outstanding customer experience:
- Since 1928 Mayo has employed a carillonneur who plays regularly scheduled concerts six times per week, at noon and in the early evenings as patients and employees are outside the buildings [pg. 42].
- The clinics have invested heavily in architecture, artwork, and decor that calms and enhances the patients' sense of confidence.
- At the Jacksonville clinic, memorial services are held for patients who die, attended by staff and physicians, with a reception afterwards [pg. 56].
- Since Mayo deals with particularly difficult cases, sometimes assembling a multi-disciplinary team of specialists is required. As the authors writes: "It means extra effort, being creative, and 'finishing the job rather than looking at the clock'" [pg. 63].
- "Good physician leaders will guide administrators, for example, away from 'efficiencies' that might compromise the best interests of the patient'" [pg. 105].
- "To sustain high productivity, Dr. Bartley concludes that the major management objective is to 'foster an environment of unity and trust'" [pg. 122].
- Mayo managers should ask this question constantly: "If our organization were to suddenly disappear, would customers really miss us?" If the answer is yes, then "What would they miss?" is the logical follow-up question. This forces the organization to understand what drives customer experience and brand preference.
So, would you rather have an efficient or effective surgeon?
Perhaps the opening story by a Mayo physician in Chapter 1 answers this question best:
The best physicians and healthcare providers are part engineers and part artists. What the artist does is why I became a physician [pgs. 1-2].
And another story from a grateful patient:
When I came to Mayo I expected good medicine well practiced. What I did not expect was a beautiful artful environment — Miros, Calders, and Rodins. Thank you for caring for my soul as well as caring for my body.
Most accounting firms don't deal with the life and death decisions that Mayo has to on a daily basis. But we believe that most PKFs spend far too much time focused on efficiency at the expense of a more valuable customer experience.
The most important things in life simply cannot be measured.
Indeed, in an accounting firm with knowledge workers, effectiveness should be your talisman, not efficiency.
About the author
Ron Baker is the best-selling author of "The Firm of the Future: A Guide for Accountants, Lawyers, and Other Professional Services;" "Pricing on Purpose: Creating and Capturing Value;" "Measure What Matters to Customers: Using Key Predictive Indicators;" and "Mind Over Matter: Why Intellectual Capital is the Chief Source of Wealth." You can reach him at (707)769-0965, or e-mail at Ron@verasage.com. Ron is a member of the AccountingWEB Bloggers Crew.