Firm Journey | Summer 2020
Victim or Victor? Measuring COVID-19’s Impact on Your CPA Firm
To evaluate how your firm managed the most dramatic business disruption in modern history, and where it should go from here, it’s time to ask some tough questions.
Tim Jipping, CPA, CGMA
Owner, Journey Advisors & CPAs
I’m sick of the word “unprecedented.” Yes, what we’ve been going through since March is
unprecedented, along with the other well-worn words used to describe it: challenging,
uncertain, turbulent. But honestly, I’m tired of them. Aren’t we all? I long for normalcy,
consistency, and routine, even though I know rapid, significant change for my CPA and
advisory firm—and the profession—will continue. But this is a perfect moment for one thing:
analyzing your firm’s response to a new kind of crisis.
WERE YOU PREPARED?
I’m not asking if you expected the pandemic to hit close to home—practically no one did.
But how did you handle the unexpected once it was thrust upon you and your firm? Ask
yourself the following questions to judge how you performed in four key areas:
1. Protecting Your Team
Despite our services being deemed essential, we still had to navigate the stay-at-home
executive orders, maintain safe social distancing, and wear masks when serving clients.
- How quickly were you able to modify your standard protocol?
- How many major changes did you need to make?
- Were you able to communicate changes to clients and staff clearly and quickly?
2. Taking Work Remote
The quick transition to work-from-home arrangements for many businesses and
professionals once again highlighted the importance of being a technologically savvy CPA.
- Did you have a technology plan in place prior to the pandemic, and do you have one now?
- Did you have the necessary hardware, software, and connectivity tools in place for
you and your team?
- What delays did you experience in shifting to a remote working arrangement, if you
were able to implement one?
3. Staffing Your Firm
Even with permission to continue operations, conducting business was a challenge. We
faced disruptions at the office, at home, and with staff.
- Were you able to respond quickly to quell staff health
concerns or discomforts?
- How quickly were you able to process health rules and
recommendations and respond accordingly? Were you able
to keep your staff engaged and productive?
- If you executed layoffs or terminations, were these due to lack
of work, a change in the skill sets needed, or management’s
inability to appropriately adapt to upheaval?
4. Reaching Business Partners
We are in the people business, so strong relationships with
clients, customers, and vendors, etc. should come naturally. But
a crisis stresses these relationships.
- Were you able to leverage strong relationships built over time
with clients and vendors, or did this expose where relationships
may have been lacking?
- Did those relationships support your firm, or drag it down?
- Did your communication with key stakeholders increase or
decrease during this time?
For years, thought leaders in the CPA profession have stressed the
importance of being future ready, adapting to technology, change,
and the shifting requirements of leadership and diversity. What
we’ve experienced, and what we’re still experiencing now, is the
ultimate test of our future readiness. This crisis has exposed exactly
how prepared (or not) we were as professionals and firm leaders.
Could we have anticipated that a health crisis that started on the
other side of the globe would have ravaged our economy in the
manner it has? I doubt it. But that doesn’t mean we should have
been caught unprepared, and it definitely doesn’t mean we should
WHAT DO FUTURE READY FIRMS DO?
To say we’re somehow out of the woods would be foolish, but as
we’re still processing the changes and challenges in establishing
stability within the uncertainty, now is the perfect time to plan for
the next pandemic, shutdown, recession, disruption—whatever
comes next. But it’s not by writing a manual or establishing policies
and procedures, it’s by transforming the structure of your firm.
Do you think the firms who were best able to handle the instant
disruption were those who had the best disaster recovery plans or
were lucky enough to be in the right niche or had the appropriate
service mix? No way. It was the firms that had already envisioned
Here are some of the steps future ready firms took
before the crisis:
- They had adopted the latest technologies.
- They had paperless processes in place, including for collections,
bill pay, and obtaining signatures.
- They had eliminated as much on-premises hardware and
software as possible (i.e., migrated to the cloud).
- They had been offering work-from-home arrangements for years.
- They had built a diverse team with the wide-ranging skill sets and
perspectives critical to thriving through sudden change.
- They had woven flexibility and innovation into the fabric of
- They had developed a network of industry professionals and
peer firms to brainstorm with and bounce ideas off.
Put simply, they built their firms for reinvention. They didn’t know
what was about to hit them, but they were unfazed by most of the
changes other firms were scrambling to navigate. Sure, they were
impacted: They may have lost clients whose businesses collapsed
or had to let some team members go. But they were miles ahead
of most of their competitors, and they’re realizing significant
benefits because of it.
The firm of the future isn’t necessarily the one with the most tools
or the fanciest technology (although it helps); it’s the one who
survives and thrives through continually increasing rates of change.
This requires a different mindset. You must get comfortable asking
yourself, “What if?” What if this vendor goes out of business
tomorrow? What if our current accounts receivable balance goes
completely unpaid? What if I’m not able to meet in-person with my
clients or staff for the next six months? Get creative! The answers
to these questions should help you plan and implement
incremental changes that move you closer to becoming a future
ready firm and, perhaps more importantly, develop the mindset and
culture to keep you there.