Adrian G. Simmons

When the inevitable question comes up in social interactions: “What do you do?” one of my favored replies is, “I help people account for things…usually it’s their money, but not always.”

What is accounting really?

Once I was giving a presentation to accounting students and posed this question to them. We learn debits, credits, generally accepted accounting principles, Internal Revenue Code, cash, accrual, other comprehensive basis of accounting, and the list goes on. But what is it really all about?

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The four dimensions of time are: past, present, future, and nothing. Everything comes from nothing.

The past is already set: it’s not going to change (though how we understand it certainly can change). The present is really the result of the past: what was set in motion then becomes today’s now. And the future will be the result of what we do today. At first glance, it seems like a closed system: at one level at least, everything’s predetermined. The action-reaction chain has already begun, and it’s simply playing out.

How, then, can one change the time sequence? From the fourth dimension. Something has to come from outside the normal time system to alter its course. That something, I propose, is nothing.

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Leadership is scary business. Both for ourselves, and our customers. It means moving from where we are now, to some place new, some place unfamiliar, some place unexplored. Leadership is personal — you cannot lead a crowd, you can only lead persons, individual people. Business is scary leadership.

In Choosing Your Surfing Style, we chatted about changing value propositions. The “wave” we looked at there (a wave comprised of successive adoption curves) charts a path of ups and downs as new value propositions move in, through, and out, of a market. Many companies participate in part of that movement. Few companies navigate it entirely. Changing value propositions is simply another way of saying leading our customers. We can lead our customers along the path of the wave as it moves through the market.

But leadership is hard. How can you help someone understand something they haven’t experienced before? How can you help them choose what you know will be helpful? How can you lead them to a better place?

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I have to admit: I’d love to learn how to surf. I sorta imagine it’d be something like skateboarding (which I’ve tried a couple times, and happy to report no major accidents) or like snowboarding (which I haven’t tried yet, but maybe soon). Surfing involves mounting a wave, finding your position, then holding and adjusting that position as the water flows under you, supporting you with its force.

Let’s take a look at the anatomy of a wave:

Okay, so this isn’t the type of wave you’ll see at the beach – only the one you’ll find in the oceans of business. There, one adoption curve after another ripples through time: first the innovators begin the momentum, then the early adopters take up the flow. Next the early majority makes it their own, after which it moves into the late majority camp, and lastly the laggards begrudgingly accept it.

We all have our preference: some of us are itchy and are stirred to push onto something no one else has tried yet. Others would like to see at least a few go ahead before they follow. Then there are those who need to see it proved before they’ll make their move, followed by those who finally catch the drift, and in the back, those who only come because someone made them.

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A few years ago, I was working on the interior components of our firm, and there were so many different ideas coming at me, that I had a hard time putting them all in context. I started to think about it: is there a way to see the firm from a bird’s eye view that can help me keep track and prioritize what’s changing, what’s not changing, what needs to be different, what should be left alone, etc? Thus was born the accounting firm process model.

Processes aren’t strategy per se; they aren’t your business model exactly, nor your organizational structure by itself. Processes are simply the way things get done. They get touched by, and touch all these other elements, so they need to live and breathe with your “why.” But having a place where basic steps are outlined goes a far way to enabling you to effectively help your customers.

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You know that Marvel comic book hero, Cyclops? The one that emits a powerful energy beam from his eyes? Yeah, that reminds me of accountants.

Flow. It comes from somewhere deep inside. Some combination of the powers of our soul: memory, imagination, will, intellect, emotions, passions, and more. You might even think of it as a spring bubbling up from within, overflowing from wells far underground. But it’s a spring which must be fed or it runs dry. Our eyes, our ears, our mouths, our bodies, our noses – all of these are ways to feed the flow. If you’ve been keeping your Big Ideas Journal, you might recognize this as the New Stimuli section – the ways we open ourselves to new experiences, broadening the types and numbers of “dots” we can connect. I like to think of it as exercising the curiosity of a child. Looking at diagrams at the doctor’s office, interacting with kids (did you know the Polaroid was invented by a father whose son asked why he couldn’t see the photo right after it was taken?), watching public television specials, taking ballet lessons, digging deeper into something you’re interested in, even if there’s absolutely no utilitarian value. It creates a flow, which can get quite powerful actually (side note: be careful what you feed in).

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“If you’re not prepared to be wrong, you’ll never come up with anything original.” -Sir Ken Robinson

That quote is taken from this 2006 TED talk video, which I highly recommend watching if you haven’t seen it before (or even if you have, for that matter – it’s that good). In it, Sir Robinson offers some observations and insights about the education system, and how we might make it better.  

It brought to mind a particular observation about accountants: that we’re used to knowing the right answer, and that people rely on us to be right. It breeds in us a predisposition to shy away from the unknown, to adopt a “wait and see” approach to new ideas, and to not step out unless we’re certain.

“If you’re not prepared to be wrong, you’ll never come up with anything original.”

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I think we’ve been duped: you, like me, have probably been told somewhere along the line that ‘accounting is the language of business.’ It’s not.

I think we like to think it is. I think we feel good that we can say that about our chosen profession. But I think we do a disservice to ourselves and our customers by subscribing to this notion.

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This past year our team undertook the effort to re-design our customer on-boarding process. We met and started brainstorming over some basic questions: What does the customer care about? What should they care about? Any and all items were noted up on our whiteboard wall.

Over a series of get-togethers, we proceeded to follow more questions down a road to define customer touchpoints, process steps, components we needed to build out, and ideas on how to build them out. Since that time, we’ve completed some basic “construction,” and we continue to build out more components as we go along. But the biggest revelation to me from the whole process was to define the results we wanted to achieve. And that the definition was a narrative, not a number.

What do I mean? For example, some of the process results we defined were:

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Greed is not good. We have only to observe what happens when greed takes ahold of ourselves, to recognize that an unbalanced desire for wealth, and a willingness to do anything to get it, leads to an ignoble form of the human person.

Yet decades of economists have taught us that it’s pure self-interest that drives the marketplace. Theory after theory states that exchange is built on the principle of people looking out for number one. And the words of Gordon Gekko in the 1987 film Wall Street (and many films since) unabashedly proclaim that “greed is good,” and what fuels commerce. Even in recent years, the mantra of the “occupy” movement rails against corporations that care about nothing but the bottom line. At best, business is perhaps a necessary evil – it gets us the things we want. But we’re suspicious of its origins, and wary to look too deep, lest we see the avaricious monster lurking underneath.

But that’s no way to run a company, and leads to self-doubt, self-loathing, and self-sabotage. Greed is bad. Business is good. It’s lifted the global standard of living by tremendous leaps and bounds over the last century. Greed is not intrinsic to business. It’s a weakness of human nature which surfaces irrespective of context. In fact, far from being its engine house, greed corrupts business, just like people, and leads to their demise.

How so, you may ask? Well, I’m glad you asked. 🙂

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The omniscient manager.

You know: the mastermind, who has the vision, and orchestrates all the pieces in a three-dimensional chessboard, to achieve a magnificent result. They are filled with sage wisdom, far-seeing insight, and a gut instinct that never errs. We watch with awe and aspire to one day be that person.

Might I humbly submit…they don’t exist. Or at least they are as rare as unicorns.

So why are our business structures built on this myth? Why do we have managers, or at least, why are they endowed with powers and expectations that far outstrip a realistic understanding of what they can accomplish? Is it helping, or hurting, to follow this accepted “professional” model?

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“Time is money.”

Our profession has grown up on this concept: time is money. You hear it even today. And there’s a tempting ring of truth to it. After all, if I put in time, I can make money. It doesn’t get much more simple than that, right?

But is it really the time that’s making me money? Or is it what I do in that time? And if it’s the latter, why am I tracking and selling time? What should I be tracking and selling instead? What should I conclude when I spend a lot of time, but don’t make a lot of money?

I have a theory: time is merely a tracker of value. And as the definition of value shifts, time can become a less and less accurate tracker of that value.

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The problem of our age is too much choice.

Endless possibilities are endless. Technology lifts limits, but provides no direction. The land of opportunity is all potential.

The result: dissipated energy.

“A large part of the beauty of a picture arises from the struggle which an artist wages with his limited medium.” -Henri Matisse

Maybe limitations aren’t something to be removed, but something to be embraced. Perhaps, the more external barriers are removed from around us, the more we should be establishing internal barriers to reinforce us. When’s the last time you made a list of the things you won’t budge on? You know, those things from life experience, that you’ve come to realize are really important to you, or that you don’t want to let happen. Maybe stop and do that now. Or start thinking about them, and make a list later today or this week. See them in black and white. Test them over a couple weeks, and find out how strongly you really feel about them. And then after you’re fairly comfortable with them, make a note of them somewhere you’ll remember.

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The Firm of the Future. What does the future look like? And how does one ready their firm to flourish in it? Lately, the future seems to be arriving faster than it used to, and these questions have increasingly grown in significance. Many of you also recognize The Firm of the Future as the title of the landmark book by Ronald Baker and Paul Dunn, where they lay out an argument and a plan for professional firms that shifts focus intensely to identifying and pricing for value. Another highly recommended title and a companion volume: Implementing Value Pricing.

Like many Thrivealists, I am fascinated by the concept of the firm of the future – it’s so core to who we are, and runs as a common thread through our Manifesto. The more I thought about it though, the more I came to think that “the firm of the future” was somewhat of a misnomer. I had a chance to actually chat about it once with Ron Baker, and he readily agreed. He wasn’t fully comfortable with the term, but he hadn’t found one he liked better just yet. More recently you’ll often find him, and other members of the VeraSage think-tank, using the phrase “timeless firms,” which I find much more apt.

Language affects thought, which in turn affects belief, which then impacts action. The problem in my mind with “the firm of the future,” is that it is both singular, and static.

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In the financial markets, “energy futures” refer to that elusive breed of investment instruments known as derivatives. The idea is that you can buy a contract now, for a set amount of energy (say, fuel) in the future. It’s what gave Southwest Airlines the leg up in the early 2000’s and allowed them to keep their prices so low for so long – energy futures, a good thing (potentially).

In a converse, but no less elusive, way, the same holds true for the actual future: it’s made up of the energy from today. The energy you expend today is shaping your tomorrow. Which means that to change your tomorrows, you have to change your todays. The future isn’t powered by, “Well I’d like to do that one day.” It’s powered by, “I’ll do this now, for my later.”

That’s all well and good of course, and perhaps we’ve all heard it before, but how do I actually change my todays? Habits have a way of staying, well, habitual. Never, never underestimate the power of inertia (something I have to continually re-learn). Inertia can be broken by a massive redirection, or by small shifts in weighting. Circumstances probably dictate which is better: the latter being preferred as less painful, but the former being required when it’s a matter of survival. But both require energy, and here is the crux of my argument: to change your future, stop managing time, and start managing energy.

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We want to see our customers treated fairly — it’s in our CPA DNA. Somewhere between learning debits and credits, independence, objectivity, and integrity seep into our subconcious. I’m not quite sure how it happens, but I think it’s what leads to CPA’s being consistently ranked among the most trusted advisors, ahead of doctors, lawyers, and bankers. To be honest, it’s one of the things that attracted me to the profession.

That desire for upright honesty and fairness surfaces in a variety of different ways: the services we provide, the counsel we give, the interactions we have with third-parties on behalf of our customers…and, in our approach to pricing.

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What is a CPA?

Well…we’re the only ones licensed to perform financial statement audits. The federal government requires it for public companies, and the states issue the licenses. But is this what defines us? Is our identity basically defined by regulatory statute?

“Bringing integrity to information.” That’s sorta what an auditor does – makes the financial information believable, adds credibility. And even if we don’t perform audits, the public turns to us when it wants an honest opinion: when it needs to be objective and independent.

“Making sense of a changing and complex world.” That’s what the CPA Vision Project proposes. I have very deep respect for the folks involved in the project, though this statement sorta leaves me wanting for more. “Making sense of a changing and complex world” feels a little vague, and lacking in a sense of direction to me. I sorta feel like it’s a definition for being “human”: we’re all just trying to make sense of the changing and complex world we live in. But what makes the CPA unique? What do they bring to the table that others don’t?

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