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Wednesday, December 12, 2012

The Value of the Rolodex


Most business people have a pretty good understanding of what we do as CPAs. In my case, I practice primarily in the audit and financial reporting world, with a focus on privately-held and non-regulated businesses (a.k.a., “Middle Market”) in Southern California.

I have over 30 years of experience in this area, most of which has been in the Southern California marketplace. I have developed a wealth of technical expertise while tackling the issues and challenges presented to me by my clients’ affairs. More importantly, I have developed the expertise and skills to resolve an issue in the most practical and painless way possible.

No matter what problem my clients throw at me, I’ve probably seen it and probably solved it. If not, I probably know someone who has. There’s the rub. The benefit of all those years of experience has created a substantial contact base, which is an essential part of my professional “tool box.” When clients hire us as a firm, they expect the highest level of technical expertise and professional experience. And they receive it. The easiest way we demonstrate this is by sharing the fact that we have had spotless peer review results each year our work has been examined by an independent CPA firm.

Peer review results are a public record of the quality of our work. We demonstrate this quality by never “punching a time clock” when resolving client issues. We ensure that their financial reporting and tax filing deadlines are met, and handle any other financial needs as their advocate. This is how we, as trusted advisors, are viewed by our clients.

However, there is another aspect of what we do as professionals that is not as well known and I believe to be one of the greatest aspects of “value” we offer our clients: networking and referrals.

Networking within the local business community is part of a busy professional’s daily routine. Personally, I invest almost as many hours networking and relationship building as I do working directly with clients. Networking benefits me as a professional because it creates opportunities to develop relationships with middle market companies and their advisors that will help me grow our practice.

Growth is important to my firm and me, both professionally and personally. It is to my clients too. Without it, it is easier to become victims of competitors. However, this is not the primary reason I spend time networking. I also do it because I want to increase my network of professionals who understand and compliment my clients’ needs, and can provide added value to my clients – to increase the opportunities for them to succeed.

When I am in a business meeting, be it with a client, a network contact or a colleague, oftentimes I am asked “what sets you apart from your competitors?” It’s true, we all do financial statement audits and reviews, tax returns and consulting, but what exactly does set us apart? In my mind, there are two things that set us apart. First, the length of time spent and experience gained in our respective fields. The “seasoning factor,” if you will.

The second, and just as important aspect, is the professional ”Rolodex®” that has been built during all of those years spent working within the community. Over the 25 years I have worked in the Los Angeles middle market community, it is amazing the depth and breadth of business contacts that I have developed – and used.

To me there is nothing more satisfying than providing an introduction that will benefit my client over and above the traditional services we provide.

Over the years I have had the opportunity to introduce clients to private equity firms, bankers, attorneys, consultants, competitors for merger, new vendors, new customers, new specialized service providers, out-of-town professional support, international support, advertisers, marketing consultants, social media experts, restructuring specialists, wealth managers and the list goes on—all addressing a specific business need at hand.

I mentioned earlier that the value of the Rolodex® is often under-appreciated, but I believe it is the key to providing a higher level of service to our clients. As CPA’s, I feel that we have a professional responsibility to provide the added value that our clients pay for.

Don’t get me wrong. Technical expertise is still number one, but we must think beyond providing just our core services. We need to take a look at our professional network and learn to be comfortable sharing this valuable resource with our clients. So talk to your clients and let them know they have access to a team of resources that you have carefully developed throughout your professional career: your Rolodex®. I believe you will discover that, not only will your clients and contacts benefit from your generosity, but you will as well.

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