Finding, hiring and retaining employees can be challenging for any professional services firm, especially when partners are challenged to meet deadlines and avoid costly mistakes that can occur from understaffing. Eventually, these difficulties may lead to client dissatisfaction and a move to competitors, adding even more stress to the equation.
Labor shortages and capacity challenges are affecting firms of all sizes across the U.S. — and data shows the future isn't looking brighter:
The professional and business services sector consistently exhibits the highest number of job openings compared to all other industries, according to the U.S. Chamber of Commerce. That's why firms must be proactive in how they position themselves for growth despite labor shortages and capacity challenges.
Before diving into strategies for positioning your firm for growth amid capacity challenges, let's take a look at what's causing these challenges in the first place.
With millions of Baby Boomers retiring and job openings emerging every day, firms are competing with each other to find skilled accountants and legal professionals. An aging population and labor shortages have always impacted the professional services industry, but these challenges are being exacerbated by shifting demographics, skill gaps and client expectations.
A major roadblock to finding talented accountants starts with one simple fact: There aren't as many students graduating with accounting degrees. According to the 2021 Trends Report from the Association of International Certified Professional Accountants, the number of accounting graduates dropped by almost 10% between 2015 and 2020.
As illustrated by the American Institute of Certified Public Accountants' consideration of reducing CPA education qualifications, firms and professional organizations are considering all options for addressing the growing worker shortage within professional services.
Clearly, the industry needs to make large adjustments to address the ever-shrinking talent pool. For accounting and legal firms, it's more than just a headache: it’s an obstacle that’s getting in the way of everything from maintaining smooth operations to delivering top-notch client experiences.
With the limited talent pool available to firms, traditional hiring methods just don't cut it anymore. Companies need to get creative and embrace new approaches to find the best talent, from social media outreach strategies to niche recruitment platforms. A whole array of options is available, and it’s crucial to tap into them before the competition does.
Getting top talent through the door is only part of the challenge, however. Overcoming capacity challenges requires more than just filling seats; it’s about building a team that feels valued, supported and empowered. These qualities are proven to drive productivity and keep retention rates up for employees and clients alike.
Similarly, tools like Propense.ai empower employees to be their very best when it comes to serving (and retaining) clients. The business development tool leverages advanced artificial intelligence algorithms to recommend probable cross-selling opportunities for clients, enabling accountants, lawyers and other professionals to stay one step ahead of their clients’ needs amid ever-changing regulations and economic factors.
The easy-to-use platform arms professionals with the knowledge they need to confidently suggest services beyond their areas of expertise. It also enables professionals to proactively engage and support clients with new services before competitors begin vying for their attention.
It's important to remember that professionals are more than employees. They have their own lives outside of the office and work-life balance is crucial to ensuring their satisfaction at your firm. Promoting a healthy work environment is proven to boost productivity and retention — essential ingredients to support your firm’s growth.
Not sure where to start? Simply ask professionals what support they need from you and your firm. You can also give them access to useful tools, resources and professional development opportunities. Equipping professionals with the proper support can ultimately enhance client experiences, all while giving professionals a sense of ownership and accomplishment. When you take care of your people, they’re likely to bring their A-game every day.
From referral bonuses for cross-selling to clients from different departments or offices to awards for innovative ideas, workplace rewards programs incentivize employees to think creatively while reinforcing the importance of teamwork in overcoming challenges. For example, some firms offer gift cards or monetary rewards to employees who refer clients or projects across different departments. This strategy not only encourages collaboration, but also promotes cross-selling initiatives across the entire firm to achieve business development goals.
By combining bonus incentives for cross-selling with awards and recognition programs, firms can create a dynamic environment where employees are motivated to collaborate, innovate and respond effectively to evolving business needs.
Achieving success isn't just about hitting targets; it's about keeping an eye on how things are going and tweaking strategies as the business landscape shifts. That's where having key performance indicators (KPIs) comes in handy.
Properly tracking KPIs enables firms to evaluate the effectiveness of their capacity management strategies. It's crucial to regularly check in on KPIs, spot where things could be better and course correct accordingly. Staying flexible and responding to changing needs is key to staying ahead of the game.
Capacity challenges aren’t going away anytime soon with the current state of the labor market. However, firms can overcome these challenges and thrive in an increasingly competitive landscape by prioritizing employee engagement and empowerment efforts, implementing innovative recruitment and retention strategies and fostering a culture of adaptability and innovation.
Visit Propense.ai to take the first step in empowering your employees, overcoming capacity challenges and positioning your firm for long-term growth.