CPA Firms Are Not Good At Succession Planning: Why Is This?
For the record, a good succession plan addresses leadership development, training, transition of the MP, merging in smaller firms and lateral hires, transition of practice development & technical expertise and a current partner buyout plan (complete with younger partners willing and able to write the checks).
I would like your thoughts on this. Why do YOU think CPA firms are not very good at succession planning?
Post a comment and let me know!
Here’s what I think:
1. $354,000. This is the income per partner of multi-partner firms today. Until this is in jeopardy, succession planning won’t get the attention it needs.
2. Management know how. It takes highly capable, committed management to lead the succession planning charge. Many firms don’t have this talent.
3. Commitment to developing people isn’t nearly high enough. At most local firms, developing and mentoring staff plays a very minor role, at best, in allocating partner income. You get what you pay for.
4. Firms feel they can always merge up. Most partners feel that if their efforts to bring along younger partners fails, merging into a larger firm will always be a good fallback. The reality is that many firms will be sadly disappointed with their upward merger options.
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