This is one article in a series of interviews with firms that are members of the International Group of Accounting Firms (IGAF).
James "Jamie" Smith, at 38, is one of the youngest — if not THE youngest — of the managing partners of all the IGAF firms. Committed to positioning the firm for success, he is also a living example to the younger professionals that their hard work can pay off in a leadership position down the road.
Grooming the next generation of leaders is a huge concern throughout the industry, as the most experienced and technically skilled partners are beginning to retire in large numbers. Much has been written about how multiple generations can work together in the workplace, but at Jacksonville, Fla.-based Presser, Lahnen & Edelman, they are making it work smoothly. Communication, flexibility and a strong leadership program are some of the keys to the firm's success.
Smith himself is a product of the firm's Shareholder in Training Program, which was started about seven years ago. It's a three-year program that identifies managers who not only have the technical background, but the characteristics that would make a good partner in the future, such as good relationships with staff and clients while managing a large book of business, Smith said. These candidates meet regularly with shareholders and are mentored and trained in some of the so-called soft skills that a partner needs to succeed.
Smith's accounting career began in 1994 with a small local firm, Adams & Harper, PA, a typical full-service accounting firm. He joined PL&E in 2000 and was tapped to manage an office in Amelia Island, off the coast of northeast Florida. The firm had acquired a small practice there and in four years, Smith developed new business and doubled the revenue. Smith now says that experience was the springboard for his success at the firm.
After 18 months as MP, Smith says he appreciates the leadership and guidance of the shareholders, particularly the former MP who is chairman of the board and has eased the transition. Constant communication with the shareholders has been key, Smith says, and it's also a trademark of the firm in its relations with clients.
Smith said the firm's motto is "always a step ahead." The firm is proactive in dealing with client issues, he said. Rather than meet with them once at the end of the year, as all firms do, PL&E meets clients three or four times over the year. Communication is particularly important in down times, Smith said. "We're stepping up our game."
PL&E clients are mainly the owners of Jacksonville's privately held businesses. PL&E offers typical CPA services, but also offers consulting services, personal financial planning, retirement plan administration and more for its clients, who are strongly entrepreneurial. The firm has a strong presence in the community and is known as being highly responsive to its clients' needs, Smith says.
The firm is also responsive to its staff. Founded in 1986 as an outgrowth of a firm started by Neil Presser, it has grown from 13 staff to 59 today, with eight shareholders. The Accountants Media Group in October ranked PL&E as one of the Best Accounting Firms to Work For, based on results from staff surveys and other criteria. "That, to me, shows there's some excitement", Smith said. "We're working hard to build a culture where younger staff can be in an environment where we can give them more and more responsibilities." Staff are paired with more experienced mentors so they can see how client relationships are built and maintained.
He said the staff members who have been with the firm for about five years have not historically been the big rainmakers, as they haven't been asked to do business development at that stage typically. The firm is trying to change that by teaching business development skills earlier, so as professionals move up the ranks they are getting more and more exposure to this part of the business.
Smith said that he looks at the client base every year and meets with the shareholders to discuss a two- or three-year transition that would allow younger professionals to ultimately manage those important relationships by encouraging more client contact, adding billing responsibilities etc. These transitions are done slowly as it's a struggle for clients to shift their long-standing relationships within the firm.
Staff actively participate in making decisions. Shareholders keep their door open to questions, and there's mutual respect among all staff levels, Smith says. Flex-time arrangements have increase productivity and boosted morale. Again, communication is key to making these programs work.
While Smith says the firm is not immune to the economic slowdown, he believes hard times makes relationships stronger and builds trust. Clients are struggling and one result is less consulting work. "Companies have had some crunch on their cash flow so they've pulled back on those extra services, which is interesting because it gives us a sense that risk is rising too. If less attestation work is done, what will that lead to?" Again, he said, the firm has stepped up its communication with clients. He also foresees opportunities in the wealth management part of the business, as some clients may be ready to make a change away from Wall Street brands.
Based on the current economic conditions and the fact that Sarbanes-Oxley work is winding down and international financial reporting standards are coming, Smith believes all firms are going to have to refocus attention on staff development and productivity. The industry as a whole has been on "cruise control", he said, with many firms experiencing strong growth in the last five to seven years. Growth won't be so easy in the future. "We have a great team now", Smith says. "We want to try to increase productivity and build market share."