It is important to develop a specialty, but it needs to be balanced with the needs of the practice and your interests. In this age of specialization and niche expertise, being a generalist is a negative to most people, indicating a lack of competency in an area. When someone professes to be an “expert” in multiple areas, the image of “knowing everything” is counterproductive to establishing your competency. Most public accountants today need to choose a specialty or perhaps two.
Choosing a specialty
Choosing a specialization cannot be done in a vacuum. You need to do some self-assessment about your interests. Choose something that could be beneficial to your firm and portable should you stop working there. Discuss your ideas with the partners and identify where there is a role that you can fill. You will also need the partners’ ongoing support. While they say you should do something, they need to demonstrate they will provide the time, resources and opportunity for you to pursue the specialization along with client service referrals in those areas. A preliminary plan of pursuing the specialization and your growth should be worked out.
That being said, you now need to start the process of deciding what might lead you on a lifelong professional path. First off there are five different types of specialization:
5. Practice management
Industry means you become an expert in an industry or industries. Some examples of this include manufacturing, construction, real estate, health care, architecture, engineering, professional services, automotive, retail, consumer products, telecommunications and more.
Each of these has many subdivisions. For example, with manufacturing, you could become adept with cost accounting, lean manufacturing, inventory controls and management, supply chain management, logistics, transportation, or overall systems and controls.
Service specialization refers to the type of accounting services. This covers accounting, auditing, internal control, taxation, financial planning, valuation, forensic and litigation support services and more. Like industry specializations, each of these has many subdivisions. Taxation alone has over 40 subdivisions that we have identified, with each needing dedicated specialists.
Industry and services specializations can be identified more fully from the websites of many accounting firms, where they not only list their areas of specialization and expertise, but provide pretty detailed descriptions. Look specifically at your own firm’s site.
Size refers to client size. Servicing small, medium and large clients requires different areas of expertise and client relationships. This can also include client liaison and administration. Size can also refer to high-net-worth individual clients and those who might require family office and concierge services.
Until the past few years, a geographic area was a specialty, and it might be for some people in some areas, but the cloud and telecommuting have greatly extended geographic areas. There’s nothing like a one-on-one relationship with a client, and proximity makes that a lot easier. For smaller firms that want to be dominant in an area, practitioners and partners need more of a generalist background. Those who want to start their own practices should consider opening a visible office near where they live, get active in local organizations, and become an approachable presence.
Larger firms can also do this, and it is less important for each partner to become a generalist since specialties can be spread out. A strong social media presence and deliberate client mining can give you leads. In many instances, geography might not matter at all, or it might! Things are changing, and sometimes not changing at all.
Practice management covers all phases of running the business of being in an accounting practice. It includes marketing, sales, human resources, training, CPE, license and independence tracking, scheduling, project and time management, new services development, pricing, billing and collections, budgeting, projections, organizing retreats and possibly succession planning for the practice.
How to do it
Once a specialization is decided upon, you need to go about making yourself an expert — read, join professional associations, take focused CPE courses, and try to write articles and give speeches. Accountants who are industry experts become industry thought leaders.
Some specialties require obtaining designations or certificates of completion that would require study and time – an investment you and the firm would have to make. There is no easy path to growth and establishing expertise, but it is a joyful ride.
You do not need to be restricted to one specialty, but the more you choose, the less likely it will be to establish yourself the way you want. You need to develop an awareness of the scope of the specialties you select. For instance, financial planning can include asset allocation assistance, budgeting consulting, retirement and education funding, estate planning, succession planning — all different specialties requiring various types of knowledge, training and staffing.
Business valuations could include estate and gift valuations, buying a business analysis, due diligence, divorce valuations and forensic investigations. While pursuing a specialty can require a large amount of time, your current clients still need to be serviced. Now is a good time to start to transition some of this work and especially anything that can be delegated to lower-level staff. You could also step up to more of a supervisory and management role and take over some of what the partner does. This requires you to be better organized and to spend time learning to train, delegate and review better or more effectively,
Part of selecting a specialization is to examine yours and the firm’s client base to see if there is a preponderance of clients in an industry or in need of certain services. Start positioning yourself as an “expert” to perform additional services and market for new clients. This is part of the learning and growth process. There is nothing bad about on-the-job training as long as you are willing to do the extra work to acquire the skills and have someone who can oversee and review what you do. A great start can be had by mining your existing client base to provide needed services.
Certain services, such as estate planning, forensic investigations and business valuations, are primarily one-shot assignments. The cost of obtaining new clients has to be covered by the work generated. When you develop a multiyear plan, the cost of promoting the specialization and acquiring new business is spread out over a period of time, enabling the establishment of a critical mass of referral sources.
Becoming an expert can help you generate higher fees, but be aware that some specialties require working under extremely time sensitive or rushed conditions, making it more difficult to schedule around other commitments. For instance, with forensic work, a lot of time would be at the command of the attorneys you would be working with.
One way to explore an industry specialization is to start attending trade group meetings, expos, conferences and conventions, and also reading trade journals and newsletters. There are many local chapters where you can attend meetings as a guest.
How to grow and establish yourself in your niche
Once you choose your niche, you need to get involved. It’s not difficult, but it takes effort. Join and attend meetings and volunteer to serve on committees and/or make presentations at these events or gatherings. Write articles for their publications. You can further support the group by becoming a sponsor and taking a table or booth at a meeting or event.
Many organizations list the sponsors on the advertising material, adding to your exposure. Keep in mind that only a small percentage of members attend events; however, the visibility of your sponsorship will reach every member of the group multiple times. In any specialization or niche, you need to demonstrate an expertise, such as writing articles or teaching CPE, which also require large blocks of time.
If you choose a service specialty, attend conferences and CPE dedicated to that specialty. Read journals and books on those topics. You can also learn from partners in your firm and find out what they have done for clients using their specialized expertise and experience.
Staff and firms that develop niche specializations can better serve their clients by understanding the industry, the dynamics of the dominant companies and suppliers, and relationships with banks, lenders, finance companies, attorneys and other professional experts in the industry. They should also understand the relevant governmental regulations and oversight groups, offshore issues, personnel requirements and training, compensation, options, fringe benefits and executive search firms, in addition to the special issues and problems faced by those competing in that space. The staff should also understand the peculiarities of the industry, making the workflow more efficient and effective.
Some firms hire non-accountants who are experts in certain industries as consultants. For example, accounting firms with nursing home clients can hire registered nurses to review charts to uncover opportunities for greater reimbursements. Accounting firms with car dealership clients may hire parts and service managers. Accountants with bank clients hire loan officers and compliance managers. Construction contractor clients get support from bonding and regulatory experts and those familiar with dispatching, project management and scheduling. Accountants with law firm clients hire former administrators, and so on. A lot more can be done where there is a concentration of clients, which also opens up funding ability for the CPA firm to advertise to obtain more clients and acquire additional resources.
Becoming an expert in an area is a growth enhancer for you and your firm. If it’s marketed the right way, it can be very profitable for you, the firm and your clients. It is definitely worth pursuing.
Sidney Kess, CPA, JD, LLM is of counsel to Kostelanetz & Fink and a senior consultant to Citrin Cooperman & Co., LLP. He is one of Accounting Today’s 100 Most Influential People, was awarded the AICPA’s Gold Medal Award which is the highest award in the accounting profession, and is a member of the NYSSCPA Hall of Fame as well as recipient of many other accolades in the profession.
Edward Mendlowitz, CPA, is an emeritus partner at WithumSmith+Brown PC CPAs. He has frequently been named to Accounting Today’s list of the Top 100 Influential People, and is the author or co-author of 28 books. He also writes a twice-a-week blog addressing issues that clients have at www.withum.com/partners-network-blog and is an adjunct professor in the MBA program at Fairleigh Dickinson University. Art of Accounting is an award winning continuing series where he shares autobiographical experiences with tips that he hopes can be adopted by his colleagues. He welcomes practice management questions and can be reached at (732) 743-4582 or email@example.com.