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Cultivating Your Firm's Next Generation of Leaders

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It’s no secret that the workforce is aging. When looking at the age distribution of today’s workforce, over 23 percent are 55 or older. Many of these individuals enjoy leadership positions in accounting firms, but we’re also seeing many older workers retire at increasing rates.

Apr 5th 2022
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Accounting firms need to act now to invest in leadership development to help prepare for the future and ensure their firm continues on.

This leads to the main topic of today’s article: cultivating your firm’s next generation of leaders. Before we dive into specifics, such as how you can cultivate your firm’s next generation of leaders, it’s important to talk about why it’s important to do so.

Why It’s Important to Focus on the Next Generation of Leaders

If there’s one thing that 2020 and 2021 taught firms, it’s that retaining top-tier talent is difficult. Most employees stay with their employer for 4.1 years, but there’s been a mass exodus of employees quitting their positions.

Meanwhile, existing staff and new talent are looking for roles where they see future opportunities for career growth, advancement, and fulfillment. Fostering this talent and their desires allows firms to better handle losing leaders because someone else can step into their role.

So, how can you strategically cultivate your next generation of leaders?

4 Fundamental Ways to Start Cultivating the Next Generation of Leaders

1. Identify Your Firm’s Leaders

To start, what should you look for in a leader? Unfortunately, finding a leader is more complex than looking for the employee with the most experience. Your leaders need to have a few key traits:

  • Growth mindsets
  • Great communication skills

The person needs to be a good accountant, but it’s not the end-all, be-all of your choice. You need to identify leaders that can develop people, are good teachers, are open to learning, and have business development skills.

Don’t choose an accountant in your practice to be a leader that is great at their job, but is always on the defensive. Unfortunately, defensive employees never fit well in a leadership role.

Leaders must:

  • Want to learn and grow
  • Be respected
  • Be technically competent
  • Have a curious and inquisitive nature

The book Good to Great by Jim Collins states that leaders have a number one trait: humility. Leaders are often not the smartest person in the room, but they’re willing to ask questions, listen and learn. The best leaders learn from mistakes and create more options by being open thinkers.

2. Create a Management Team

If you don’t have a management team, it’s time to create one. Once you have identified these future leaders, it’s time to get them involved in the decision-making process and begin sharing their perspectives.

Start by asking them what they envision for the firm 5-10 years down the road and what their core values are, then work to create something they and you are excited about. When you understand the vision and core values of your management team, you can define what the firm’s culture is all about.

You can use this cultural understanding during the hiring process and when talking with prospective clients, as you only want to hire team members and bring on new clients that are good fits. At my firm, just because someone is intelligent doesn’t make them a good fit to work for us. They also need to be a great communicator.

3. Invest in Leadership Development

Investing in leadership training is how you mold the future of your firm. You need to offer group and individual training. Management teams must learn how to navigate challenges and work through internal issues together.

When management teams work through internal issues together, they learn skills that enable them to help clients who are dealing with similar issues. Leadership training can be many things, but it needs to revolve around development in important areas, such as:

  • Communication skills
  • Emotional intelligence
  • People skills
  • Firm management
  • Practice development

Soft skills matter a lot in today’s leadership roles, and they’re crucial to consider. Through proper training and development, you’ll be a team of potential future leaders that will continue to guide your firm to success in the future.

4. Create a Plan to Bring New Leaders to the Firm

When you envision the next partner for your firm, it should be someone with a strong background in leadership and one who aligns with the vision and mission of your firm. However, this alone is not enough. You need to properly plan to bring new leaders on board. Some items to consider when creating your plan are the following:

  • What’s expected of partners and how to attract new leaders
  • Timing of becoming partners
  • Roles and expectations of all partners
  • Entitlements and non-entitlements of partners
  • Overall description of a partner
  • Checklist for the path of becoming a partner

The right leaders will inspire your firm, guide its growth, and maintain the culture and legacy that you worked so hard to create. Following the steps above provide with you actionable steps to start cultivating these leaders now so that they can begin taking a lead role tomorrow.

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