“I’m looking for a 40-year-old.” Three times last week I was approached by CPAs who said those words to me in one form or another. At least two people the week before. I guarantee I’ll hear it again several times before the end of the month. Just what do these people want with 40-year-olds? They want a successor. Since I joined the Society 12 years ago we’ve been talking to our members, in small public accounting firms specifically, about the importance of succession planning. Now, it’s starting to become a real issue. As more and more members are approaching retirement, they are looking to bring other people on to help work through this. The only problem is I don’t have any 40-year-olds in my back pocket to give them – no list of names – nothing. I feel a little helpless. Of course, I talk to members and can make some networking connections from time to time, but this is a hard task.
Why a 40-year-old? I think someone 55-60 years old sees a 40-year-old as someone who has enough work experience to bring to the table that they will be valuable, but still has enough time left to work that they’d be interested in having their own firm. The problem is – there just aren’t enough 40-year-olds to go around. Generation X, the generation I’m a part of, isn’t as big as the generations before and after it and frankly we’ve been kind of overlooked; sandwiched between the Boomers and Millennials we tend to put our heads down and just do the work (or that’s how we’re portrayed). And, the type of 40-year-old who wants to be an entrepreneur probably already started in that direction and is working in their own firm. Or are they? I don’t have all the answers and I certainly don’t want to make light of it. I am grateful to be in a position to help when I can and, as an organization, INCPAS needs to figure out how to do more to help our small firms with this issue.
I will offer a few tips:
- Keep talking to the 40-year-olds, but consider the 30-somethings too (or even younger professionals). They may not have as much as experience, but they might be at just the right point in life to take the leap and become a business owner.
- Start looking as soon as you can. I know it’s hard. You’re so very busy and you don’t want to take the risk of bringing on an heir apparent and then watch it not work out. But it’s something to think long and hard about a long time before you really need someone.
- Write a job description for a future successor. Think about what you’re looking for and what you really need. And create a job for that person. With a salary. Oftentimes, people want someone to come on and develop their own client-base – that makes sense, but it also puts all the risk on the side of the successor. Usually those who want to be that risky have already started their own firms.
- Check out the CPA Center of Excellence® and specifically the book, CPA Excellence: A Quick Start Guide To Defining and Mastering Vital Skills For Success. In it you will find helpful information, frameworks and checklists for dealing with all sorts of HR issues including succession planning. It’s is available as a hard copy for only $19.95 (less for quantity orders) and can be ordered online. An e-book version will be available soon.
Keep asking! The Indiana CPA Society exists to enhance the professional success of our members. We want to help and we’ll continue to hold sessions on this topic at our Small Firm Conference and other events. We’ll keep publishing articles and providing networking opportunities. I’ve heard many members over the years say this isn’t an issue that they’ll just “turn off the lights” when they are ready to retire. But, I’ve been around too long and I know better. You care about your clients and you want to see an easy transition for them.
And if you’re 40 or younger, and consider yourself to have an entrepreneurial spirit – there’s a lot of opportunity out there for you and I’d love to hear from you as well.
Please comment on this blog if you have ideas or suggestions about how we can help, or if I’ve missed an important aspect of this topic you want to discuss. In the meantime I’ll be on the lookout.