Why Your Accounting Firm’s Old Playbook Isn’t Working Anymore

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Welcome back to another episode of the Growthminded Accountant Podcast.

My name is Lee Reams.

I am the founder and CEO of CountingWorks.

So, uh today's topic is going to be fun.

It's going to be forward thinking. there's a little bit of thought leadership.

I'm also going to give some practical kind of examples of what's changing um and what the opportunities are ahead for you.

So I think this is the first year where the mantra of accounting firms do it the same way as we did it last year.

It actually starts breaking.

It actually starts working against you.

And there's a number of reasons for that.

One is the amount of knowledge and tools that are available to your client base.

Um they can find things out they used to have to turn to you before. uh but more importantly competitors uh the shortages the boomers that are are retiring the shortage in talent.

So I think things aren't just going to not necessarily start feeling harder but they're actively going to limit what your firm can become.

And uh the reason is simple.

The ceiling has moved.

Um and what I mean by that is the opportunity in this industry is bigger than it's ever been. uh but the way most firms are operating kind of the same way as last year hasn't caught up and I think uh firms feel that before they can actually explain it.

So, uh, you're busy, but you're still growing, right?

But there's an under underlying sense of perhaps, you know, we should be further ahead than we are.

Okay?

Uh, you know, it I don't feel like I feel like I'm drowning, right?

And that's usually not just necessarily a talent problem, but I believe it's a model problem.

And I'm going to talk about kind of some examples and then ways that you can move your firm forward here in the AIH.

So, let's make this real.

I like to use kind of a a persona.

We'll call him Mike.

Mike has a business.

Uh he's a client of yours is $2 million a year.

Great client, right?

Pays their bill on time.

Uh shows up to appointments, doesn't ghost you.

Every year you file his return.

Uh maybe answer a few questions outside of the tax interview.

Uh maybe a quick uh year-end call.

From your perspective, I'm like, that's a solid compliance client.

Uh you know, but in reality, Mike is probably sitting on two times, five times more value to your firm. but more importantly what their potential is.

You know, what kind of financial outcomes could they have if you were able to more proactively provide advice that made them more successful?

And the reality is Mike doesn't even know it, right?

He assumes if something mattered, you your CPA, EA, you know, hey, they bring it up, you know, uh Rebecca would bring it up, right?

And that's where I think firms struggle.

They know they provide value, but they don't necessarily communicate it in a way that a client can understand.

So compliance is easy to explain.

We file your return.

You pay for a 1040, we file the return for you.

Uh but advisory, it's ongoing.

It's strategic.

It's it's future focused, right?

That's harder to explain.

You need a narrative behind that.

You need some brand positioning.

Perhaps you even need some blog articles, some social media posts.

You need to be able to say, "Hey, I realize clients don't necessarily buy advisory, right?

I'm not buying a tax return." But what they do buy is confidence.

They buy clarity.

Uh they buy drisking, right?

Uh they like they're buying better decisions and more importantly better financial outcomes, right?

So if you don't successfully translate that, you kind of default back to your compliance pricing.

And then what you end up doing is you underpric I think your smartest work um and you're kind of overworking is a way to look at it your lowest margin services which is the compliance side.

So let's go back to Mike and kind of explain this in a different way.

So all the opportunities are there tax savings perhaps their business entity structure um capital advisory right maybe they're looking to raise capital what kind of capital what you know what are the tax ramifications can I afford it um what are the op options right do I do an SBA do I find venture money you know there's all kinds of strategy involved in that right cash flow obviously uh hiring strategies um dealing with uncert certainty in markets, tariffs, wars, you got all kinds of things that these people need to be stressed about right now.

So, you know, if your system is not built to surface or act on it, you don't really have what I'm going to call consistent touch points, um, automated insights, perhaps integrated data, uh, follow-up workflows that work with this, right?

So, advisory becomes what I'm going to call occasional, more likely it's reactive. you're finally in a client meeting or they call you to say, "Hey, I'm thinking of selling my company." Well, we should have been planning for this 5 years ago.

And if you had been proactively advising, they would have been set up for this, right?

Um, and then what happens is it becomes very inconsistent.

And it becomes inconsistent across your entire firm, every partner, every touch point.

And that's why advisory never scales.

So, I hopefully kind of painted the picture of the old days.

And now I'm going to talk about kind of what's changed in technology and I'm going to hopefully explain AI in a better way than our industry has been doing.

The the usual AI, you know, people think, well, it's a chatbot and I talk to it and I ask it questions and it gives me responses.

And here's the hundred ways to write a prompt.

Do I believe learning how to write prompts is probably the biggest skill every accounting firm should train all their employees on?

Absolutely.

But that's two years ago.

AI has changed dramatically.

And I think what you're going to start hearing um and you may so those that are techsavvy already know this.

They've heard of an MCP.

You're getting firms like Salesforce, Zoom, uh starting to offer their MCPs.

And what that means, what is an MCP?

It's model context protocols.

The best way to think about it is connecting your AI brain with data points and other tools so they can start working together uh without you basically or they can start feeding data into one brain that then creates an output.

So before you might have had tools and now you have one connected system that can link all these tools together.

So I'm going to give this is an example of what we're doing here accounting works and try to explain this so you get it.

So we have a tool called Max which is our AI brain let's just call it and Max is trained on top of um what I'll call the fundamental uh model.

So chat GBT Gemini the two you know sometimes we'll bring in other tools if they're better at things but basically what we've done is we've created a knowledge layer that sits on top of these fundamental um models and it's just smarter.

So the results are much more accurate.

Um we're basically it's almost like a tax research team on top of chat GBT and what we have found is that really makes the outputs much more accurate than if you just use a tool by itself.

Uh it's more trustworthy is that a way so what we're doing is we have developed all these kind of standalone agents.

So we have a prospecting agent for example.

It will go out and find dental firms in San Diego with revenue between this and this and then set up actual outgoing emails, writing blog articles, doing FAQs that autopublish to your website to to start attracting those people as clients, right?

And it's kind of seating.

It's a marketing funnel that isn't a standalone agent.

We have a proposal tool.

It does onetoone personalized proposals.

It can look at market conditions, what you should be charging.

It writes scope.

It limits scope, so you don't have scope creep, but it's an independent agent.

So, think of that as an agent for engagements, an agent for to-dos, tasks, perhaps meeting transcripts, client communications, writing responses to client messaging.

But now think of this as you start connecting these individual tools to max the brain.

And an example is so we have these internal MCPs.

So we have all these agents.

They connect to Max and now Max can go find skills that are already set up with guard rails.

What is right, what's wrong, how to do this, you know, security-wise, um to create really consistent outputs, right?

And then you can start finding external MCPs like a Zoom.

And now you can start bringing um the transcripts from a client interview, for example, into Max's ecosystem.

And now Max has an agent that might summarize that meeting.

It might proactively write a strategy follow-up proposal or some sort of report for the client.

It may even kick off to-do list for your staff saying these are the talking points.

This is what we talked about.

It's all there.

It's all inside Mac.

So, it's all working together.

Now, I'm going to try to explain this in a little bit different way.

This system now actually understands your client.

It can read the uh the inbox, for example.

It scrapes data from client uploads, so it knows what the tax return looks like.

It knows what the financial statement looks like.

So, let's go back to Mike.

Um, instead of digging through all this information, which I don't think anyone has enough time andor the brain power to do, right?

Um, the max now that's connected to all these MCPS um sees that it sees income trending higher.

Maybe it sees a low bank account, proactively outreach to the client.

Maybe the estimated payments are off.

Maybe it sees an opportunity to to uh restructure as an escorp or something, right?

And what it does is it flags it instantly.

And now what may have taken you hours now takes moments, but you as the human and the way we're doing it is we basically have like a I'm going to call it a dashboard, but we have max at the top and every day you log in and it's going to say here's your morning briefing.

You have eight advisory opportunities. you have three appointments, you have two uh proposals to review and send, right?

So, what happens is your role starts changing.

You're not reacting because the client called you and said, "Oh, my bank account is almost out.

What do I do?" You've already saw this ahead of time.

You've messaged the client.

You're coming up with a game plan.

How can we make some changes to get you through this choppy time?

You have been proactive, not reactive.

That is true advisory.

And that's how your AI systems when working together can surface these opportunities for you.

Okay.

So your role changes, right?

You're you're showing up with insight.

You may have already helped solve their problem.

And and in some ways, this is, you know, I think the part that is always overlooked.

It's not just what systems unlock.

It's what they give back.

So and I I like always to do accountants like to talk about ROI.

They like to talk about time.

So the old model, you spent two to three hours uncovering something like this for Mike.

Now your AI Max did it in minutes and it did it overnight while you were sleeping, right?

You just came in in the morning and like, "Oh, Mike has a problem." Um, and now multiply that across your client base.

So, you know, let's just say you work 40 hours a week.

We know off season you don't.

I don't know people still on their Disney cruise.

Others are working way more hours.

But let's say we reduce the the amount of time you're spending 20 30%.

You know that's a full day or more back every week, right?

And the question is what do you do with that time?

And that's where everything starts to change.

So now you have options.

You have more clients without hiring.

Maybe you have higher value advisory to more clients.

You have better margins obviously if you're spending less time.

Um and more importantly you have more time.

So you have that choice.

Do I want to bring on more clients?

Do I want to have a better life balance?

Um, you know, and and most firms didn't have that choice before.

So, you know, and this is where I'm going to get into kind of, and I've done this on previous episodes, but I keep talking about AI is not just a tool.

You got to start thinking of it as labor.

So, it removes the friction around your tax research, your client communication, your followup with clients, and even your execution on how you do things.

So it doesn't replace your expertise, it amplifies it.

Okay?

So now you're spending minutes validating something that the AI surfaced versus hours of trying to discover that.

Okay?

So going back to our example of Mike, old model, let's say for compliance charging $2 to $3,000 a year.

New model, I I still say CFO advisory should, if you're doing it right, be $2,000 a month.

Uh, but let's just say new model, $6 to $10,000 a year.

That's significant, right?

Same client, less time, more value, and more hopefully a better financial outcome from Mike as well.

So, the client wins.

Um, they're getting better decisions year round.

They're getting your attention year round.

It's still personalized. you're not losing that human in the loop, but you're letting systems do all this heavy lifting of analyzing, you know, no pun intended, reams of data um you know, automatically for you.

And that's uh where this starts really coming together.

So, one of the things that we do need to understand is accountants have a hard time communicating this, you know, how do I convert or how do I communicate talking points about advisory that actually connect?

So, let's go back to Mike, you know, and I would say instead of a vague message like, "Hey, hey, you know, we should we should talk tax planning." Uh, you say something uh like this.

So, hey Mike, uh, quick heads up.

Based on what we're seeing in your numbers right now, it looks like your income is trending up or down, right?

Um, you know, more or less than last year.

And that likely means, hey, you may be underpaying in estimated tax.

Let's go with the higher one.

So you're paying probably underpaying your estimated taxes which would be a problem.

There could be an opportunity to reduce overall liability through planning and potentially optimize you know how you're structured going forward.

So AI could have created this personal message because it already knows all these details and then this it could have ceued up this email in your dashboard to send out to your client with a proposal there.

Or then it says hey I'd recommend we spend 20 minutes to walk through a few options.

Most clients in your position end up saving significantly or you know at least avoiding surprises.

Uh want me to send over a couple times their availability.

Want me to send over a proposal if they're not already under the compliant I mean under an advisory um contract.

That is how AI MCPs systems talking together really work.

And that's very different.

Um and this is also very personalized versus the way you were doing it the old day.

Hey, you want to talk tax planning?

That was a very personalized delivery of what advisory really is.

And it's different because it's very specific.

It's timely and more importantly, it's outcome focused.

That's really important.

And now that's when you attach your proposal.

So, uh you call it, let's just say tax planning and optimization review.

So, uh we're going to identify tax saving opportunities.

We're going to evaluate entity structure.

We're going to optimize estimated payments.

We're going to provide forward-looking strategy.

Now, it's not advisory.

It's a clear next step with value.

Okay?

So, you see the changes in just the wording that we use.

And now, you're using a system with playbooks.

We call them playbooks in our system, but that run year round, right?

So, they're automatically surfacing these opportunities.

So, again, if you're using a system like ours, you come in and it says, "Here's your opportunities today.

Hey, I like those six.

Don't like those three.

Delete.

Delete. delete, send proposals or messaging on the others and that helps you now communicate to your clients one to one and to me this is really how advisory should be sold in the future because it actually kind starts selling itself.

So what replaces the old model systems first not people first um advisory built into workflows uh AI supported um execution uh connected data across the journeys.

This is where these MCPs come in.

And then more importantly, the proactive communication and the art form of writing that communication and using the right words.

Um, it's it's amazing the difference in conversion when you do it and you communicate it effectively.

So once it's built, you don't feel overwhelmed anymore.

It's just running.

You actually feel in control.

You have a dashboard.

It's kind of like this is my entire firm and it's just running.

It's our firm that runs itself.

But it's not.

It's the human in the loop.

You're doing that knowledge stuff.

That's what you're compensated for.

But you're not stuck on billing for your time anymore.

You're billing for your outcomes, the quality of your advisor, the the the financial outcome of your client.

You can bill completely differently versus if commodities and AI is bringing the time to do every task down, and you're still stuck on an hourly billing model.

What do you think's going to happen?

You're going to make less money, right?

So, it's a race to the bottom.

So, that's why this advisory, this shift is so important.

Um, and it's it's a window.

Uh, the firms and I I hate doing I'm not a hook social media guy.

I I hate gloom and doom and fear.

I'm not an Elon Musk.

Everyone's out of jobs.

I think the opportunities right now are immense, right?

But I do believe the firms that adopt uh this technology and these workflows now are going to pull ahead very fast.

Um, they're going to create narratives.

So, they're branding.

They're actually going to care about marketing.

They're actually going to care about their messaging.

They're going to care that they're communicating what advisory is all about.

They're going to find the right clients or the right clients are going to find them.

They're going to go to Chat GBT and say, "Hey, these are my problems.

I have a business entity.

Who's the best CPA in my area?" If you had optimized your story around what we're talking about, chatp is going to say Lee Reams and Associates.

Here they are.

Here's their number and these are the reasons.

So, um, what you're going to find is I feel you're going to have the halves and the halves, and we're already seeing it.

We're seeing firms struggling even in a booming industry, and we have other firms that are at capacity.

They're turning away clients, but those that adopt this new technology, and there's a reason the big accounting firms are spending billions of dollars in AI.

Um, they know what's changed. and a small firm, boutique firms, individual soloreneurs, you really, if you use a system like I'm talking about, you can be super human.

You can do a lot.

So, you don't need more clients.

You don't need more people.

You need a system that captures that opportunity already sitting inside your firm.

So, if you're listening and thinking, uh, we have clients just like Mike and you know, we might be leaving value on the table, you're not alone because that's what most firms do.

And that's not a coincidence.

That's a system gap.

So that's what we're talking about.

I hope I articulated this.

I see this as the future of the industry.

I see a lot of software products that are still software products that are just adding AI on top of it.

Very few are structured as a system mode.

You got to be very careful if you start using public tools and then client data and connecting them.

Um you know you need secure you need guard rails. you need secure um mo modes of communication.

Uh what was it?

There was an article some guy I forget the company um but they were using claude and claude deleted their entire client database um because they were connecting these tools kind of the old wild west way.

So you need expertise.

You need to make sure you know what you're doing.

But those tools are out there.

Um and I think more importantly you already have a client base.

All you need to do is put a system in this year. start finding these opportunities, rethinking the way you work with clients.

Um, I think it will turn what you already have into something much bigger, you know, and is that meaning two times, five times revenue for some clients?

Absolutely.

So, this is our latest version of the growthminded accountant.

Again, I believe that this year is the big kind of change year.

Um, and you're going to see a lot of winners and hopefully not too many losers.

We're trying to win work with as many winners as possible.

But uh if this resonated with you, you can always reach out to me at LinkedIn, message me with any questions.

Um but start thinking differently.

Start thinking of kind of how the future is going.

Um you know, don't perhaps follow all the hype and don't get all up and down on every media.

You know, this latest tool is going to do this and latest tool is going to do that.

Obviously, there's always things that there's kind of pools and um and things change.

So, Uh I want to continue talking about these subjects matters.

I really am going to start getting into more um about positioning, understanding narratives, really understanding the important of marketing in the upcoming uh episodes.

So again, thank you for being a listener of the growthminded accountant podcast.

That is a wrap for this one.

If you have any questions, reach out to accountingworkspro.com or go to our YouTube channel.

Uh the growthminded accountant podcast is on there as well.

So appreciate you being a listener.

Uh we'll talk to you guys again soon.

Thank you.