Throughout the early 2000s, growth had been a focus for Dick Ingwersen and his team at Gifford Hillegass & Ingwersen LLP.
“My feelings have always been that if I grow too fast, then things are going to fall through the cracks, and I’m not going to do the kind of job that I want to do, and the firm’s not going to do the kind of job that we want to do,” the co-founder and managing partner says.
The addition of Sarbanes-Oxley kept the business rolling in, but in 2008, the accounting firm was flat, and by 2009, it was down about 9 percent.
“Sarbanes-Oxley created so much work for everybody that … you just answered the phone and that’s how your business grew,” he says. “When [the recession] hit, that stopped. People had gotten maybe less aggressive being out there doing things to grow the business, because it was just growing automatically.”
Ingwersen took action. He went out and got his 80 people focused back on growth, and now, he expects more growth moving forward.
Smart Business spoke with Ingwersen about how he led GH&I through the recession.
Retain your top people. Be sure that you’re doing whatever you have to to keep your best people. Raises and bonuses were really down across the board, but [for] your top performers, it’s business as usual. Make sure that you don’t treat them like everyone else. We said, ‘Hey, raises are down this year, but for our top people, we’re going to give them better raises they deserve it for what they’re doing.’ You do that; you talk to them. You communicate with them; you let them know that they’re our young leaders group. We say, ‘You’re a young leader, and we’re planning on you to be not just a young leader but a leader overall.’ They’re doing a good job so they deserve a little bit more overall and just encourage them and coach them and mentor them.
We would do that, and we would tell our clients the same. You know a lot of people that you work with, and some you hate to lose and some you wouldn’t mind to lose. The ones that you hate to lose, you need to pay more attention to that’s just common sense, but sometimes people don’t do that.
People take things for granted sometimes and they don’t do that, and then it’s a devastating kind of thing if one of your very top performers came to you and said, ‘Well, things weren’t going that well, and I saw a better opportunity over there,’ and they were gone. You don’t want that to happen with your clients either.
Rein in the spending. You have to look around and see where are you spending money that you don’t need to be, that’s just kind of a luxury or maybe even a little bit wasteful.
You look at your P&L and you see where the categories are and you think about it.
We had some extra services we provided all of that is part of, you expand, you want to provide as many services as you can, but some are more profitable than others, so you weed out. We had a recruiting section, and we had to put that aside. While it was great for our clients occasionally, it wasn’t supporting itself on its own. … They were nice to have, but they weren’t our core stuff, and it wasn’t making money, so we had to cut back in those areas, which was part of our selective downsizing.
You look at where the big expenditures are and those things that aren’t core, and that’s where you cut back, and you advise your clients to do the same thing. Just go through it and say, ‘We’re spending this much money, and how much benefit are we getting out of this?’ If the top line isn’t moving, you don’t want that whole thing to take out your bottom line. You have to try to generate as much revenue as you can [by removing] some of the fat that got in there when things were going well and you were growing, but they weren’t necessary, essential-type expenditures that you needed to be making.
Network. It’s renewing contacts that you’ve had. If you haven’t talked to somebody you can think of as a referral source or (called) a friend of the firm in a few years and you think, ‘They’re taking care of me, and they’re going to refer things,’ well the facts of life are, they aren’t thinking about you at that point in time. [Call them and say,] ‘Hey, we haven’t spent any time together in a while, let’s go have breakfast.’ Then all of a sudden you’re back in their mind, and I don’t know how many times after I’ve made a reconnection like that that they’ve called me after and said, ‘Hey, I have this person I want you to talk to.’ They knew me, but they weren’t thinking about me until I reconnected with them. The people know you; they’re not thinking about you unless you do it on a current basis.
There are new connections too. There are people out there. The hard thing that happens in our profession is that you have to discipline yourself, because you are so busy doing all of your stuff and working with the current people and staying close with them, which is important, but you have to carve out some time to do that.
It’s important to keep the business coming in, because you’re going to lose business. We lose really good clients that get bought out by usually bigger, maybe public, companies. We helped them grow … so when you think about that, you could be doing a great job, but then the business is gone through no fault of your own. If I want to keep 10 [customers] and five are gone, the new side has to be 15 to keep me 10. That’s a constant thing it’s reconnecting and spending some time.
How to reach: Gifford Hillegass & Ingwersen LLP, (770) 396-1100 or www.ghi-cpa.com