Eyes on the Prize: M&As, Leadership Changes Present Growth Opportunities
Merger and acquisition (M&A) activity among CPA firms has been on a wild run over the past few years. While these deals are often great for leaders at the top, what about the rest? Experienced M&A leaders offer suggestions on how staff can use these transitional changes to their advantage.
By Natalie Rooney | Winter 2022
M&A deals have cooled slightly in 2022, but for the accounting profession, things are still hot. Over just the first eight months of 2022, investment bank William Blair reported 64 M&A transactions in the accounting services sector, compared with 81 in 2019, 65 in 2020, and 74 in 2021.
“The frenzy is very real,” says Allan D. Koltin, CPA, CGMA, CEO of Koltin Consulting Group, whose Chicago-based firm had consulted on 20 accounting firm M&A deals as of Sept. 30, 2022. “We will probably end 2022 at 30 deals,” he estimates. “A normal year would be 12 to 15 deals.”
Organizational changes, like M&As or other leadership transitions, often create a work environment surrounded by stress and anxiety,
especially for those below the leadership level. Of course, it’s a natural, human response to any form of big change. The same old, same old is about to become new—and that can be scary. Questions like: “How will this impact me,” “Will my budget be cut,” “What does this mean for my team,” or perhaps, a timelier concern, “Will I still be able to work remotely,” are likely to be buzzing around the office’s water cooler and Zoom chats.
But what if these transitional changes didn’t have to be so scary? Instead, what if these changes presented you and your team with a prized advantage? If you ask most experts, they’d agree that these changes are a positive.
Here’s how you can prepare for an M&A or other leadership change and see it as an opportunity to grow your career.
Stay the Course
First and foremost, don’t immediately run for the exit sign—your firm still needs you and they aren’t asking you to leave. Most firm leaders not only care about you, but they’d love for you to stay and find your best fit within the changed organization.
Current Illinois CPA Society (ICPAS) Chairperson Mary K. Fuller, CPA, managing partner of Citrin Cooperman Advisors LLC’s Chicago office, says when a firm considers a merger, it wants a fit for both its clients and staff. “You can’t run your firm without your people, and most of all, we want them to be able to grow.” This mentality is what steered her through the closing acquisition of her former firm, Shepard Schwartz & Harris, by private equity-backed Citrin Cooperman earlier this year.
Fuller acknowledges that M&A activity creates stress and anxiety, and words alone won’t put people at ease. Ultimately, Fuller says it’s leadership’s responsibility to show staff that the firm’s transition is a positive for them: “You have to show them they’ll have choices and opportunities.”
Brian Blaha, CPA, growth partner on Wipfli’s leadership team, says when new firms are acquired by his firm, the goal is to create a common vision for what the organization is today, and what it’ll become—but it takes time. “The last thing you want is to bring in a firm and have someone move on. It puts a strain on merger integration,” he says. “We focus on the culture and getting people on the right teams within the firm and then connect them to a peer advisor to give them someone to talk to at a common level. We ask them to give us a year to show this is going to go alright.”
Position Yourself for Success
There are many reasons firms decide to merge, and right at the top of the list is creating new opportunities for individuals to grow their careers, says ICPAS Immediate Past Chairperson Thomas B. Murtagh, CPA, JD, tax partner and regional tax director at FORVIS LLP. Murtagh’s prior firm, BKD, merged with DHG this summer to establish FORVIS, whose name represents the “forward vision” of the more than 5,400 partners and team members who’ve come together under the new brand. Thinking of the career opportunities that come from strategic mergers, Murtagh says one should look beyond traditional tax and audit options as the new firm may be able to explore new markets and client services. “It’s an opportunity for folks to raise their hand and say they want to get involved,” he says. “Be willing to be open, volunteer, and participate.”
Koltin says there are three thought processes people go through when considering their career options during and after a merger:
- Will this allow me to accelerate my career growth? Can I get promoted more quickly because the firm will be growing faster?
- I’m happy where I am today with a balance of work and life. Is this going to rock my world? Will this culture give me enough of what I like?
- Can I financially do better, and can I get more challenging work?
It’s important for staff to work through those questions, but leadership also needs to consider the same set of questions and evaluate how they’re meeting the needs of staff who want to grow and accelerate. “They need to make sure these avenues exist for their star employees,” Koltin says.
Consider these additional steps when positioning yourself for career growth following a merger or acquisition:
- Be open-minded. Talk to leadership and speak with both partners and managers. “Look around,” Fuller advises. “Who’s experiencing success and taking advantage of opportunities? Ask if you can hang onto their coattails. Ask for introductions. Don’t wait for things to come to you. Raise your hand and let others know you’re interested in doing something new or different.”
- Give the acquiring organization a chance. Blaha encourages associates to assume positive intent on part of the firm. “In most cases, a larger firm means creating additional opportunities for the associates,” he says.
- Take initiative and lean in. “Opportunities aren’t just going to come to you,” Blaha says. “When I coach young associates, we discuss who they should meet and where they think they’ll fit in. Then, leaders can assist from there. But you need to take the initiative to meet, learn, and give. After all, leaders can learn from you, too.”
- Have a positive mindset. It’s important to remain positive, be engaged, and ask questions. “Make your voice heard and do it in a way that feels like you’re working to find solutions,” Murtagh says. “Conversations like that will be more than welcomed. We [partners and firm leaders] want to hear ideas for better ways to do things.”
- Get out of your comfort zone. “I’ve been doing this for 40 years, and I feel like I have a new job,” Fuller says. “It was new, exciting, and scary to go through the private equity deal, but I knew it was going to be great. Now I see a lot of young people here who can be a part of something big.”
- Look for different types of opportunities. If you don’t hear about a service line role you’re passionate about, look internally. Murtagh says mergers create a need for team cohesion. “New people need coaching and assurance about the opportunities and benefits from this sort of restructuring. How can you play a role in that?”
Avoid Getting Stuck
During any transitional time, Koltin says it’s important for associates to not get stuck in the “we’ve always done it this way” mindset. “Sometimes we get so locked into the old ways and change passes us by,” he cautions.
When Fuller sees associates falling into this pattern, she reminds them the world is always changing. “If something doesn’t work, we’ll do something different,” she says. “Giving it a try first is my biggest thing. We all have things we don’t like to do but seeing them through a different lens is part of our learning and growth.”
Blaha reminds staff that learning takes place on both sides of a merger. “One of the reasons we do M&A is to continue to advance, especially on the consulting side,” he says of Wipfli. “The boutique firms we’re bringing in have processes and go-to-market strategies that can be more advanced or provide a twist to the ways we’ve been successful. We want to know about that. Bring us your ideas for how to do things better.”
When the desire to stick with the old ways strikes, Murtagh encourages comparing what’s being lost to what’s being gained. Ultimately, an associate might decide what’s being lost is too much, and the new firm isn’t the right environment or part of their career goals. “That’s why it’s important to not skip this ‘what’s changing here’ thought process,” he says. “Work with your coach or mentor to address your questions and worries. It’s better to acknowledge it if you realize it’s not the spot for you. You don’t want to be unsatisfied with your career.”
Talking to people in leadership who can provide you with information to make the transition more manageable is an important step, but going into these new situations with an open mind and thinking broadly will also help you see the positives for both clients and team members. “That’s what creates rewarding careers and opportunities,” Murtagh says.
Identify Your Opportunity
Change brings challenges, but it also brings new career opportunities and resources. In fact, mergers often invite opportunities for people to explore other niches in their fields. Whether it’s cryptocurrency, technology, international tax, trusts and estates, wealth management, or auditing of construction companies or governmental agencies, for instance, the possibilities are endless.
“Maybe one part of the merger has a deep bench in a particular industry or in a different line of business,” Murtagh points out. “Part of the reason for doing these combinations is to have a bigger base upon which these great minds can come together and develop new tools and ways to serve clients.”
Koltin says individuals at smaller firms have likely been generalists throughout their careers, which is good, but a merger offers new opportunities for specialization. “It’s like declaring a major,” he points out. “Now you can choose a service line and go deeper into that niche. There are so many options to narrow things down and become the person who’s famous for it. What do you want to be famous for that’ll help your firm separate itself from everybody else?”
For those going through a merger or other transitional change at their organization, Koltin offers the following words of wisdom he’d give anyone joining a new company:
- Learn the playbook, the services, how the firm goes to market, and how people advance. What are the most important things?
- Use your coach/mentor to assess your skills. What are you really good at? What are you really passionate about? Where good and passion meet represents what you should be doing in terms of your individual goals.
If interested in pursuing new opportunities within the changed organization, Blaha emphasizes that you don’t necessarily need to reach out to top leadership to express interest. “Talk to your current team,” he says. “Ask them to help you get connected.”
Bring Your Growth Mindset
When a big change takes over an organization, some employees immediately take the drastic step of jumping ship before giving things a real chance and without talking to leadership about their concerns. As a firm leader, Fuller admits that these moments are disappointing. “We could’ve found someone new opportunities with different clients or industries or even in a different location,” she says. “Just ask!”
Blaha encourages flipping the narrative. “A merger is a new opportunity, not a barrier. It comes down to mindset. The situations that arise in our careers that require us to stretch are often when we grow the most,” he says. “When you come in with a growth mindset, you’re more likely to find opportunities versus when you’re change-resistant.”
“Your mindset is the one thing you can control, and you get to choose it every day,” Murtagh says. “It takes being conscientious about that mindset and what you’re bringing to your firm, office, and team every day. If you look at these challenges and changes as opportunities, it’s a way to navigate and shape a career that’s incredibly rewarding for you in the long term.”
Natalie Rooney is a freelance writer based in Eagle, Colo. A former vice president of communications for the Ohio Society of CPAs, she has been writing for state CPA societies for more than 20 years.
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