S02 E01: Everything you need to know on optimizing your accounting firm’s workflow in 2024

Roman Villard
Right on Accounting Flow today we’ve got Mr. Matthew May, how are we doing?

Matthew May
Doing great, man. Nice to see you.

Roman Villard
It is nice to see you as well. So today, we get the opportunity to chat a little bit about optimization of accounting, firm workflows. What is that? What’s it looking like moving forward as systems change automations exist and kind of go through a journey of where we’re at today and what we believe tomorrow holds for the best practice and accounting firm workflow. And so Matthew excited to have you chat about this a bit. Before we jump into that. Can you give me just the elevator pitch on who is Matthew May?

Matthew May
Who is Matthew May? Matthew May is a recovering auditor, almost 10 years recovered from Cherry Bekaert and Ernst & Young. I was a partner at Cherry Bekaert and then the last 10 years have been working with really some great folks building a company called Acuity here in Atlanta, which is now a remote worldwide firm with about 150 employees working with about five or 600 companies all around doing their as you would say CAS work right? Or somebody would say I don’t know, but then I use CAS differently than every else. Don’t get me started on that. So we outsource their accounting department. How about that?

Roman Villard
We also use accounting departments and we will aim to define what CAS is in 2024.

Matthew May
So I think we’re gonna lose that battle because the AICPA is like heading down a path that we’re just gonna have to say outsourced accounting.

Roman Villard
Yes, I think yeah, cash, we’ll see what they decide on that front. Okay, so 10 years at Acuity when you started, how many folks were there?

Matthew May
When I started, there was 10, folks. So yep, that’s crazy. And we’re working with about 50 or 60 clients.

Roman Villard
So okay, so 10 people, and now you’re over 100 with a global workforce. And so…

Matthew May
150 people, we just we just finalized our Philippine sub, so we have a Philippine subsidiaries working working on moving all of our third party relationships to a single relationship with us. And we also have a that’s 26 or 27 people right now. And then in St. Lucia, we also have 17, folks. So we use a partner company for that.

Roman Villard
Okay, so different different time zones, different nationalities, different backgrounds, people all over the place…

Matthew May
Different dialects, a little bit of fun, a little different culture here and there. It’s awesome.

Roman Villard
I love that so much. But when you think about workflow, communication, the necessity to work together as a team, you will have seen quite the iteration on that over the years. And it’s so important for your globalized team to communicate well to work together to understand who’s accomplishing what can you kind of give me the just high level overview of just like one client comes in, like how do you guys delegate tasks? How do you think about that today?

Matthew May
Yeah, I think what we think about the world and kind of three buckets, we think of it in, you know, tax, we have a tax team around a 10 per person, tax team that does business, business returns, we think of it in accounting, let’s say and then we think of finance. So we have a CFO team, about 10 people texting about 10 people and the rest of the people about the rest of us all work on the accounting side, from bookkeeping, all the way to very sophisticated gap closes, right. So that core group is what I’ll probably talk about most, because those other ones kind of stand on the periphery. So, you know, we went through everybody else’s journey with workflow tools, I think we worked were on like our fourth workflow tool. We worked with Teamwork, we work with a crappy one way back when we worked with Karbon. And then currently we’re on a random one, which is not really a workflow tool. It’s more of a process enablement tool called process street, but it’s really isn’t built for accounting firms. But we’ve moved away from the checklist kind of world, and we move more towards facilitation. So like, if you can we have a great head of product or her name’s Patty sharp, she built catching clouds, and which was an E commerce specialty firm is working with us now. And she, she’s really helped us kind of crystallize, what process would look like. So we have lots of really defined processes now, as you can imagine, but we have 96 products in our Salesforce, you know that the sales team sells and each of those launches, different workflows, and they’re all in various degrees of optimization right now.

Roman Villard
So it’s interesting, you know, you mentioned not thinking about it through the lens of like checklists and task. You think about it more in terms of how does the process flow throughout, you know, origination or closing of a product sale down through the, you know, how do we accomplish this with our team I’ll talk about that just a little bit, because there are tasks that that I can accomplish through process. But how do you think about that?

Matthew May
So what we found with if you do a checkbox, like reconcile the bank statement, do whatever do whatever do whatever, right? Like, what happens is they do their normal stuff, and then they come back and check off the boxes, like a good employee. That’s a good employee. Like, but what we’ve tried to move through and like my goal, personally, is to like, eliminate to where nobody’s checking a box unless it does something for them. So that could be a team notification and a Slack channel that that task is done, that could be a some kind of zap that triggers something down the road, like that could be a spreadsheet that gets created. It could be an update in Salesforce, like the that the financials are delivered, things like that. So if you think about, if you think about that, like what your tasks should be, we do that the other thing we do in our in Process Street, it enables us, if we do have a check the box tax, we have a training in it, like a live training, like it’s not like reconcile bank statement might be the task, but then it might be a video on how you reconcile bank statements if you’re using XERO. Right. So you might you have that like as a refresher training there. We have a lot, a little bit of that in there. So we have kind of like more of a kind of a hybrid, and sort of a workflow tool, we have a hybrid training / automation enabler going on. So it’s a little bit different way to think of workflow management.

Roman Villard
Yeah, it’s interesting, because I think natively accountants really like just the feedback of checking a box and accomplishing something on a to do list, they get accounts by nature just kind of have that embedded in their ethos. But to your point, I think there are ancillary things that that can end or should occur when that box is checked, if it’s a part of a greater process, because inevitably, when you do accomplish with that one task, there will be a sub sub task sub event sub something that needs to occur that you guys are starting to approach through automation. And, you know, more of the process mapping process. When you think about the automation side of things, the or maybe more of the optimization side of what you’re building on the process front. What opportunities do you think exists today, in terms of ensuring the team is moving the same direction as you all continue to scale?

Matthew May
Well, one of the, I guess, the last six months, I’ve spent a lot of my time, trying to identify how we can be systematically proactive with our clients. So what that started with was identifying, and we’ve kind of got it narrowed down to five or six kind of triggers, to say, when this happens, we should be proactive in this manner, or this is a trigger to at least stop, pause and do this. One of the challenges I think, with this work that we do, is in I when I used to do the work I was the same way is I became compliant and gotten the like, when I was on a client, I was like I was on a roll, like I was gonna roll I was in my mode. And I was going but I wasn’t stepping back and saying how should I be proactive? So we’ve, like I’ve kind of come to the thinking where it’s not reasonable to, for the person doing the work to be proactive in all cases. So in those cases, where they’re not like there’s some stuff that’s just intuitive, but there’s some stuff, it’s just like, you need somebody else to come in and say, Hey, these things are happening. Other people think this is this is something you need to think about, or they need to intervene or just need to interrupt the pattern to get some proactivity involved. So that’s what I’m working on.

Roman Villard
So yeah, interrupting the pattern. You know, when you think about the work that we do the redundancy in a lot of cases on a month to month basis, it is so easy to get into that rut of just checking that box and saying I accomplished this task. Let’s move on to the next client accomplish that task, and then rinse and repeat the next month. And so what you’re talking about is systematically like programming, proactive communication, proactive triggers to allow maybe ancillary team members to see what’s happening in order to take action on behalf of a client.

Matthew May
Yeah, to at least start a discussion. So we have we’ve moved and accountability last year for client retention to a team member we call the team lead. So that’s like a basically it’s like a firm owner in most cases because they have a bottom you know anywhere from I guess the small his team probably has a $600,000 book and the largest team is running basically a three, three and a half million dollar book, which is most people’s firms, right? Some somewhere in those. So each of those team leads are basically firm owners if you really think about it, and but if you have 60 clients, or one of them has 250 clients, like how do you systematically get them data? Because you get so much data today? How do you get them the triggers in the right places and the right forms? To kind of work on what that looks like, right? So what, what’s a meaningful interaction? And what’s not just a interaction where you’re like trying to raise somebody’s price, right, when you intervene on a client just to raise prices, like, so we experimented last quarter with people hitting a million dollar in revenue target, sending them a little, you know, little thing saying congratulations on at $83.3k. Right. You know, that’s a cool thing. Like you would do an environment somebody hits at $83.3k. Like, you do the million dollars in ARR, like Lucite thing that you send that not branded acuity, something that they have branded, there’s just sent to them that was like, hey, congratulations on that. And that starts a conversation about other stuff, too, hey, you’re growing, like do whatever. But it’s like starts with the right place. In our ecommerce practice, the best example we had was a systems change. So there was something happened at Amazon, I can’t remember something quirky, what’s going on with how that was gonna work with a to x. And she had sent this like, huge thing out to all of our EECOM team. I was like, You are drafting that, in sending that to our clients, like we got your back. We’re tracking this, you’re doing that, right. So there was a couple of updates, things like, like from that perspective. And then we look at transaction volume triggers, we’re looking at some non non kind of objective trip triggers subjective triggers, we’re asking our team for kind of like, kind of a State of the Union, like, one to five, like, I’m really happy with this client, I hate this client. I think the client hates us, I think they’re about to fire us, like just some kind of subjective thing. There. We were, we had pinned, we had been doing that for a long time. And now like, we have like a trigger, like, if it’s like the crappy one, it goes over here. Or if it’s the great one, it goes over here. So you’re like, oh, that’s somebody you can use for referral for the sale team. Oh, this sh**y one, I need to intervene and see, like, just check in what’s wrong? So that’s, that’s some of the stuff we’re looking at and trying to figure out how you do that programmatically and systematically.

Roman Villard
There’s a lot to unpack there. And a few things that that like, really, you know, that I that I clue in on? One is that when you think about proactive communication, oftentimes, as a firm owner, you’re looking for those additional revenue opportunities, right? What are the additional services that I can provide? Oh, hey, there’s a tax implication here, maybe I can proactively pull them into our tax department, or, you know, there’s capital raised over here, here’s a trigger, maybe we can upsell them on CFO services, you know, I tend to think about it in those terms, but what you’re alluding to is customer success, hey, you hit a million revenue, here’s a, here’s a gift, like, here’s something we thought about for you because of this massive accomplishment, which is amazing to think about how it could be revenue generation, it can be customer success, it can be client satisfaction, client heat map for internal purposes, supporting the sales team, and their referrals, or proactive communication on what’s happened in the market, like the E comm example of, hey, we see this occurring amongst a smaller group of clients. And now we can publish this for other clients and make them feel really secure and confident that we’ve got their back. Like there’s there’s so many far reaching impacts of what you’re trying to accomplish here on the systematic proactivity of your processes.

Matthew May
Yeah, I mean, the cool thing is like, because we have five team leads that were each, we just said, this quarter, we’re going to try to be proactive. That was the guidance, right? So we had all these things start popping up. And they were like, What do you mean? What do you mean, I was like, call people talk to people do whatever, then they’re like, nobody will talk to me. I was like, somebody was like, Can I send him a gift? Send them a gift, I don’t care, like, can and then I saw that internal update on the company, send them send, like let’s make that into a blog. And let’s send that out in from our thing. Like, let’s let’s send them out to our clients saying Don’t worry about it. We’re tracking this issue, and we’re really close on right. So is this amalgamation of just like a like it took us saying, let’s try to be proactive to be proactive. Like you have to be intentional about it, which is great. Yeah, like we just all get busy.

Roman Villard
Yeah. And what’s amazing to me is that it’s all part of firm workflow. And traditionally people think about firm workflow is like, reconcile the bank, you know, reconciled balance sheet, all these task oriented items. But now, like we’re taking this workflow conversation into, how is it impacting every, you know, function department within the business so we can collectively be successful. And that’s where I think there really is a long tail to optimising accounting firm workflows, in looking outside of what is the month to month task that needs to be accomplished. So I think I think you’re onto something there. What, what are you looking forward to in 24? Kind of over the next number of months in terms of how do we expand on what you’ve done from a proactive standpoint? And do you have specific goals as it relates to that?

Matthew May
I do have some specific goals on it. But I’ll be I’ll be continuing to work on on those things, the first thing that we’re going to do is we’re going to segment our customer base into three segments. So we’re going to say we think there’s a part of our customer base that doesn’t care about their financials, doesn’t read our emails, they just want financials to do tax returns. So we’ll call them the compliance group, then we have these people all the way on the other side that have external pressures. So they have to have GAAP financial statements. So they need like this full GAAP financial statement, they have external users. So we’ll we’ll call those the externals, right. And then we have this middle group that are using their financials on a day to day basis, and they need it to be kind of like modified from compliance, so their internal folks, so internal use, folks have like a set of things that they need done, right. So our, after we get the first quarter, we’re going to get all of those all of our 600 clients into each of those buckets. And then we’re going to start working on what productivity looks like within each of those buckets. Because in a compliance setting, it just might be getting them an estimated tax number in quarterly basis, right? That’s all they want from a productive basis, and maybe some updates on systems and software and stuff like that. The gap people, we’re going to work on what that kind of full up full product looks like, like, what does that look like at the, you know, what does Full Send look like for them? Right? For our SAS clients, right? What is Full Send feel like? I love your your, your your terms with that. So like, how does that get defined? And then what’s productivity look like? Under that lens? Right? So in each of those segments, like think about that last last quarter, we kind of came up with those segments. We there’s 100 ways you could group clients, right? So you just, you just had to pick and those are the ones that we felt had different needs.

Roman Villard
And then you go to three layers deeper and overlay industry, you overlay size and stage, you overlay all these different riders that impact what the bucket they’re in.

Matthew May
So we’re just doing the two layers. We’re just doing the stage, those three stages and then industry. So those are the two layers because our team lead as an industry specialists in three of the five cases.

Roman Villard
Yeah. And I could almost see a specialist or a team lead almost liaison Within those stages, because the requirements complexities that come with a gap financial required client is very different than that that would be compliance only as a do you envision a place where you have kind of these stage liaisons for each industry team lead?

Matthew May
I think as we grow, I think a team lead has to have, I think they will be supported by an industry leader. Like at scale, right. And so when EComm has to break into two team leads, like they will need an industry leader that that can track the industry and, and stuff like that. And we do have kind of accounting expertise. You know, the X audit partner meet comes out when people need the high GAAP stuff, right. So like we do have some you one thing that we do differently than other firms is that if you’re on a team, you’re not solo on that team. Like you can still have clients on other teams and still help other teams and like, you have to do that to still have a firm at the top level or each or each team would function like a separate firm and you’d stop losing some of the economies of scale of how work in this similar like similar enough to where people could use people from other teams because ecomm like in a dip right? Right now. So ecomm in a dip so are they? Like, I want those people to have jobs? So like, aren’t they need to be able to support other teams? You know, crypto goes through waves, right? So like that team has to flex like nobody’s business. Right?

Roman Villard
And there’s some innate crossover on an industry by industry basis. And utilising similar skill sets. Some are more applicable than others. I’ve always thought that anybody that can do ecom CPG, could probably do just about anything in the SAS tech world. And so it’s interesting that you have those, like, kind of swing players, as I think about like a football team, you know, you got the Vulcans starting lineup, and they can sub in for a patriots who I shouldn’t use the Patriots is a bad example. Use a Los Angeles Rams teammate if they need to.

Matthew May
Yeah, well, I mean, we’re big. We’ve been around 20 years now, too. So we have repeat entrepreneurs that start having relationships with the team leads and the team leads. Goal is to like, be as firm owner, like, the person that had like, maybe they’re running a family office that has a real estate entity, plus, plus a company that they’re running plus a another family office kind of thing, you know, so like, you don’t want to split them up, like you got to be flexible enough to where you do stuff that makes sense for the clients still sure. So team leads have to be a little bit well rounded.

Roman Villard
When you think about the team leads, workflow, the processes that you’ve developed, do you look at all that through the lens of client satisfaction client experience? Or do you look at it through the lens of you know, what’s gonna benefit our employees and what benefits our employees then will benefit our clients? So how do you view that?

Matthew May
Yes, several questions there at the same time, so like, for specifically for the team lead role, if they have a Northstar metric of reducing customer churn, right. That means they have to guarantee productivity, quality, like all the things you’re supposed to do for the client, you have to also down sell at the right time, if he’s going through things like it’s not just upsell or down sell, you have to have right services right time. But you need these triggers to be able to do that. So Northstar metric, to me for Team Lead is customer churn. The number one driver of customer churn in our firm, is employees leaving. So in order to have stability, with customer churn, you have it’s like Maslow’s hierarchy, you have to have happy employees first, happy, well trained people that fit the culture is like at the base of the pyramid of Maslow’s hierarchy here of needs. So we can create that, like, first employees happy, then client, then customers happy?

Roman Villard
Yeah, I like that a lot. Because I think there’s a lot of fodder out in the accounting space of Let’s do everything through the lens of client experience. And what you’re saying is, you know, we need to really hone in on the employee experience first, because you’re not going to have one without the other.

Matthew May
Yeah, I mean, during COVID, when people were just reassessing their lives, and we had the highest employee churn we’ve ever had, we had the highest customer churn we’ve ever had. It was it was, like, a unreal, how much customer churn we had. But like, if you’re in this is maybe a little bit unique to us. Most of our clients have a one to one relationship with somebody here, right? And so if an employee leaves, it’s magnified on other people that focus on up market, mid market kind of stuff that are team related, like a single employee leaving is not that big of a deal. But in our case, it is like usually the point person.

Roman Villard
Yeah, which that that having that one on one relationship can often be a great client experience. Factor. And the reason why they may choose to work with acuity is, hey, I’m going to have a relationship with somebody there or maybe have a pre existing relationship there. And so yeah, that is that is challenging. So we’ve walked through how you how you view process, how you view workflow, we’ve walked through how you think about proactivity, how you’re slicing and dicing your client base in order to improve internal operations and workflows and processes for your team. A little bit about how that team operates. When we think about further optimization, I think a lot of people are listening are like wow, they’ve got it dialled in, like what more can they do? Because most firms are pretty small and haven’t seen the level of scale that you guys are at. And so when you think about further optimization, like what’s that next layer to really peel back for you guys? So, once you have these things like really up and humming.

Matthew May
I think what would I’d like to do is to really take each niche, and to allow it enough flexibility to blow it out in its needs. If you think of like, where you and I came from the SAS world, like we got some really specific needs, like you got some cardio needs, you got some rev rec needs, you got some pretty powerful needs. So, I like getting back to what I love, it’s, which is kind of working with the clients that I love, which is tech clients for me. Yeah. So I want to create that for everybody. If somebody’s passionate about in at acuity about family office, if somebody’s passionate about marketing service firms who are just passionate about construction, real estate, like we built the construct now for them to go. Like, so that’s my, I feel like we’re starting to uncover a bunch of stuff. And that comes with, you know, hitting that eight figure revenue mark and having a team where like, 25 people are working on the business all the time. You know, like, it’s like, we have 25 people that work on the business, not in the business. Sure. Right. So like, having that team that continues to dedicate time to that just creates these opportunities. So I’d love to see a new vertical come out next year or an existing vertical like, like, my dream is for like SAS to just be buttoned down next year. Like to where everybody’s like, Oh, yeah, in Atlanta people know us for SAS, but I want nationwide like people to be like, all these are the SAS guys. Right?

Roman Villard
So you’ve, you’ve scaled up to the degree that you all have scaled up now only to niche back down and to hyper focus.

Matthew May
Well, the way the world is going, like, if you’re going to add value, you have to be hyper focused. Yeah, like I’ve always added more value to SAS clients, than nonS AS clients.

Roman Villard
Yeah, sure.

Matthew May
People in fundraise mode. Like, you just see it. Like, you see the angel investments, you see the VC investments, you see, you get pet peeve because people name change from series A to series C, like, you know, like, stuff like that, because you’re old like me. Like, you have opinions about stuff, right? Because you have had the experiences and you’ve been through some of the cycles. So I think the way to add the most value and grow the fastest is narrowing your focus. Yeah. I like that. We’ve had that happen to us over the last decade, every time we’ve narrowed our focus, we’ve grown faster.

Roman Villard
I was going to ask for any parting thoughts of wisdom for a young firm runner out there that may be listening to this. But I think you just hit it on the head. If you want to grow fastest, you got to focus down and niche down on those things that you can really have impact on.

Matthew May
Yeah, I mean, the best advice I have was advice I got from a business coach. So he was like, What do you want to be known for? What do you want to be known for like we like because I was a Cherry Bekaert at the time and I was using the guy’s name’s Andrew Dietz great guy. And 10 of us had been through his coaching thing and, and some people in the group were like, they didn’t want to want to focus because they didn’t want to miss out on opportunities. And his challenge to me was like one of your successful so you go sell a hospital accounting services are an audit at the time and like then you go have to go audit the frickin hospital. I was like, because hospital was my like, that’s my like, runaway, HIPAA like sort of thing for when I was doing audits. So I was like, I just want to that’s how the, my Twitter handle came about that year. So like, I’m gonna be the tech CPA. I’m just gonna work with tech firms. I’m just gonna do that. And so niche because what if you’re successful guys? Like, what if you’re successful, like if you go the other way, and don’t niche and you’re successful? You have to serve all those people. Like it’s crazy. You know?

Roman Villard
You bring up good points, you bring up very good points.

Matthew May
So you make enough mistakes over the decade. You’re like, you learned some stuff.

Roman Villard
So yeah, and there aren’t as many, maybe Twitter handles that still exist or, you know, names that you could pick up. But if you’re listening out there, secure your Twitter handle, figure out the niche, and then go back and revisit all these processes and workflows that can really help stabilize the operations.

Matthew May
Yeah, for just making people checkboxes, I’m totally against that make it so it like helps somebody know to start something, or helps notify a team of a status. Something that’s gonna be useful if they’re checking a box and nobody’s using it behind them. Why are you doing it?

Roman Villard
Like it. Its perfect. Well, I’m super thankful that you were able to spend some time talking about workflow today. If people want to get a hold of you a Do you want them to and be where would they find you?

Matthew May
Well, that’s fine. People get a hold and can get a hold of me if they want. I don’t know why you’d want but the @TheTechCPA on Twitter or LinkedIn are the two easiest ways to find me. All kinds were around on the ecosystem to if you’re an accounting firm owner, I’m in the future firm, accelerate ecosystems so you can reach out to me there. That’s the best way if somebody’s a firm owner, probably. And then if you’re not on LinkedIn or Twitter, but that’s a hit or miss, you just have to make sure you’re specific like, hey, Roman said, I should talk to you or something like that. Or like, I love the Financial Cents, guys on the Financial Cents guys work next to us in Atlanta, or one of them is in the same same co working spaces. That’s I don’t know if you knew that.

Roman Villard
Yes, yeah. That was a recent recent change. Yeah. So that’s the Atlanta move there. Very good. Well, thanks for joining today. We will wrap here and yeah, thanks for joining Accounting Flow.

Matthew May
Thanks, man.