Building a Firm Employees Will Love with Erin Daiber

Hello, and welcome to the Big Four Transparency podcast. I'm joined today by Erin Daber, the founder of Well Balanced Accountants, a consulting practice to help firms create cultures where accountants love to work. Welcome to the pod, Erin. Thanks so much for having me. Yeah, my pleasure. So we kind of spoke recently. I love the sort of mission of what you do. And it's, you know, it's not too dissimilar from kind of where I'm operating, but we sort of we go about it in different ways. So can you maybe just start off by telling the audience a little bit more about Well Balanced Accountants? Absolutely. Like you said, we are a boutique consulting firm. We offer coaching and strategic planning and succession planning services, really a wide range of services with firms. But it was born out of my experience coming out of the Big Four, very not too dissimilar from your own, where I went into the Big Four thinking and into public accounting thinking, this is what I'm meant to do. And this is going to be a long term career. And I'll be a partner, only to find out, I've made it. Yeah, only to find out pretty quickly that the numbers side of accounting wasn't for me, you know, sort of experiencing it from the inside, that it wasn't all it had, that maybe I had made it up to be in my mind, and that it probably wasn't going to be the long term fit for me. So I set out to find a way to work with accountants without doing the debits and credits myself. And that really has evolved over the years. But now we get to work with firms of all shapes and sizes, really helping them with all of their people related challenges, and helping them to implement and operationalize, if you will, some of those changes that really can make a difference for their, their employees. Right on. And so we understand kind of the the perspective you're coming from, like, what were some of the specific things that to you made it clear that it was maybe not a match? Like to work at the to stay in public accounting? Well, I learned about myself later on that I'm not naturally very detail oriented. So I think one of the things I started to observe in myself was I would get these review comments from my seniors or my managers about these really minute details. And the first thing that would run through my head was who cares, which I know is not the right answer for that position. But I found it really difficult to focus on things in that level of detail, I have more of a strategic creative mind. So I found myself really wanting to focus there, enjoying the parts of the job, like interacting with the client. But you know, when it came to writing a technical memo, or doing some of that really detailed work, it was exhausting. It was really draining for me. And I would leave at the end of the day, just completely run down. And that the number side of it, that was not the thing that was getting me out of bed in the morning. And it really was the people I you know, I mostly got up and went to work because I was excited to be there in the audit room with my friends most of the day. Yeah, yeah, I had a pretty similar reaction at the time too, where I was like, yeah, you know, you should be putting red boxes around whatever. And I was like, Oh, my God, right? Like, things like that. Yeah, I think you can really get people down. Did Ernst & Young, so you were at EY, did they have those like personality testing things? Like I know Deloitte was huge on that. They had like, you know, Guardian and it was it was not so dissimilar to like the 16 personality tests or like the things like that. Did you did you ever do that at Ernst & Young? And like, were you like polar opposite to most of the people there? We actually didn't. I don't remember doing that as part of our training. That may have changed now. It's been a little while. I learned a lot of this stuff once I started coaching and working with a coach. I found some of those tools and was introduced to them, took those assessments and realized from my results, wow, this is why I was, you know, I struggled so much. It sort of helped me to put language around how I felt when I was working in public accounting that I didn't have. So in hindsight, having that level of awareness would have been so helpful. I think I could have maybe worked my way through some of those challenges or frustrations that I was having because I could have said, oh, OK, this just isn't your natural approach to things. Erin, figure out a way to work with your own style to ultimately get the result that your team is asking for. Yeah, that at the time. OK, yeah, I had gotten a lot out of that exercise. It's funny because in general, I, you know, I'm iffy on some of those because I think people are like, they'll use it to justify a lot of like their behaviors and whatnot. But for the testing we had done, it talked a lot about like, oh, your interactions with this other type of person, like look out for this, like here are some like maybe like coping methods of like, you know, making sure that that's a good relationship. And that was helpful to me because it was it was literally like, you know, there's the spectrum. Everyone was on the one side and I was on literally the other side. And it was like the two people I really liked working with were also kind of in my area. And I was like, oh, like, I get it. Interesting. OK, so, yeah, so you had that time in public accounting, ended up moving on. And then now, like, it seems like, you know, you're a pretty established consultant, like you're working with some some serious firms now. How does that kind of progression of like, OK, so I'm leaving big, you know, I'm leaving big four and I want to instead consult on this area? How did you kind of establish your expertise in that? That's a great question. So, first of all, it wasn't a direct jump. I spent some time in industry I worked with a coach to figure out what I wanted to do next. And by the time I figured out what I wanted to do, really what it started out looking like was a one on one coaching practice. And I was working with leaders at all levels inside of both accounting firms, finance, but also in other industries on really just about anything. I think that's how it starts out when you go off on your own. You'll take any revenue you can get. And over time, it evolved. I think initially because of my burnout coming out of the profession, I resisted working in it again and then realized that I had developed all these skills and was helping people in other industries to cope with similar challenges. So that's really where I started to draw the connection of, OK, CPAs or people working in public accounting could really benefit from this. So how do I come back, share what I've learned, and help improve the situation for my friends and future CPAs that are going to enter the profession? So it was a lot longer of a path than it probably had to be. But maybe that was a little bit of my stubbornness, not wanting to come back into that world right away. And I think it just generally takes a little longer than you think to build up a thriving practice and get yourself to that point. And then there was also a part of or maybe a moment in time where I just decided, I'm not going to have it all figured out. I don't have to have all of the technical expertise, but I understand people. And so I can go in there and help people. And I think there's a point that as entrepreneurs, we have to get past our internal feeling of not being ready or not being there or not being expert enough because you can get caught in that cycle forever. So I had a few firms that I started working with in various capacities and just built on that momentum. Interesting. Yeah. And what's the main sticking point that a lot of firms are having when they're speaking with you? Because a problem with culture or not getting the most out of your people I think can manifest in so many different ways. And so what's the symptom that they're usually coming for you to help you treat? Because I doubt that they're coming to you being like, we have a deep ingrained culture problem and people don't like us, right? It's probably like, hey, people aren't motivated or something like that, right? Absolutely. Yeah. It's the, how do I know if I have a culture problem? Those symptoms are generally if you're losing people. So most times firms will call me if they've lost a few key members in the last six months or so. Especially if one of those people who are leaving are really integral to the firm. Maybe they were somebody that they had already sort of picked out to be a future leader of the firm and then they leave. I've had firms reach out to me when their partners have had enough and they quit well before they were expected to retire. So that's one of the main ones. You have the turnover. Some of the other symptoms are if your recruiting success rate has slowed. So you're out there, you're still doing the things that used to work for you to recruit top talent, but you're losing them to your competitors. That's a good signal to say, hey, somebody else out there is doing something that's more intriguing to this talent than me. I wonder what that is. And productivity is a big one too. Often the complaint is how do I get them to work harder? It's like pushing a boulder up a hill to get even the bare minimum, which is not something you have to live with, but I do think is a symptom of just sort of a disempowering culture. And what is that early stage of you entering in that business look like? I imagine, and I mean we spoke about this, there's a lot of pulse surveys and things like that to understand where the employees are at. But what else typically does that kind of look like? Well, that's the biggest one because I think some organizations will come in and say, oh, okay, you've lost people. Well, here's the three things we should do without truly understanding why you're losing people. It's like we're going to treat the symptom, we're going to put a tourniquet on it, but we're not going to actually address what's causing the bleeding. I take that opposite approach where I really want to understand at a deep level and at all different levels inside of the organization what those pain points are because it's not uncommon to go in and see that the things that are causing your managers or your senior managers to leave is very different from what's causing your staff to be unproductive or ultimately leave the firm or not choose the firm in the first place. So we do host pulse surveys, focus groups, insights interviews with people inside of the organization to really understand what those problems are. I'm not a big fan of one-size-fits-all solutions because they don't fit all. That's what we've found. Yeah, I really agree with that. There needs to be an assessment period and even for me, when I'm working with some firms, people tend to be very reactive of like, okay, cool, right? We're losing staff. Well, we need help on salaries to understand how we can hire the people and close those candidates at a good rate. And I'm like, well, okay, I'll help you with that. However, I think you should be reframing this as again, what I do is pretty limited to the compensation side of things, but I think you need to reframe this from the lens of compensation. Are you creating a loyalty tax? Is the only way that your employees are going to get paid properly for them to leave? Are they maybe finding out about issues with pay and equities internally that you can't stand by? And then also, yeah, you need to have competitive salaries to bring people through the door, but it's more than that. It's more systematic. And so I imagine for culture, it goes even deeper than that, where it's like, maybe it's too much work or also maybe it's actually too much work on your timeline without the flexibility that's needed. Or maybe it's that you keep calling me and everything's an emergency and I'd be fine to get all of the workload done, but not on Sunday night. I've had a job like that and made me absolutely miserable. It was the worst thing ever. And so like, yeah, there is a lot of complexity. So I like that you kind of acknowledge that immediately of like, this is not going to be a one size fits all approach. And then for those pulse surveys too, right? Like a lot of places I've worked do internal pulse surveys and it's never going to be the same. Like you need to have someone who's external, who can communicate like, okay, this is safe. And I'm just going to talk about the findings. I'm not going to like show the individual results. I think pulse surveys done externally versus internally are like probably a lot more effective. People are going to be a lot more candid, right? That's what we found because there's inherently, even if you're using technology, even if you've put some structures around it to try to ensure anonymity, there's, especially in a small firm, there's a lot of uncertainty about how that information or feedback is going to be used, how anonymous is it. And if the managing partner goes and bangs hard enough on the door of HR, you know, is that person actually going to maintain your anonymity or is it going to get out? And so, yeah, there's, you can't, I find that you can't really rely on some of that feedback. And you also can't rely only on feedback of the people as they're walking out the door, because that may not be fully accurate either. So, you know, our goal is always to catch them certainly to make them feel safe and open and to give them understanding about how that information will be used. And then also to catch them at a point when they're not so, you know, so far gone that they're just telling you all the things you do terribly, because we also want feedback on what's working so you can get more holistic and accurate data. But you're absolutely right. There's so many components and pay is absolutely part of it. Benefits in general are a part of it. But I think we saw this sort of mid-COVID times where firms just started to throw buckets of money at people. And it works for a little bit until it doesn't. And then firms are frustrated because they're like, we cannot pay them anymore. We're overpaying them already. So now what? And that's what we can get at by really digging into the underlying causes. And so there's obviously like a pretty significant selection bias here, because I think the type of firm who will contact you is a firm who is aware that there may be flaws and are willing to change. But I think you said you've done work in like some other industries prior to accounting. Do you find that accounting leadership tends to be kind of more or less or similarly receptive to kind of the type of suggestions that they're getting? It obviously depends, right? And you're right. Selection bias. I find that a lot of firms are very open, but it is just the firms I'm talking to, right? There's plenty of people that are not picking up the phone. Or that I find they'll pick up the phone later for an issue down the road. For instance, we have a partner getting ready to retire and we want to figure out a succession plan. And then we look back and see that they haven't really done anything in the meantime to develop people or retain people. And so now we have a bigger problem. So I find that it really does depend. There are certainly leaders in accounting that are still kind of digging their heels in, hoping things go back to the way they used to be. Both from a pay and sort of structure of the firm to work ethic and all of those things and technology. And then we've got some that are very, very open to it and really intrigued by this idea that maybe it doesn't have to look the way it always looked. Even though they've probably worked really hard to get to where they are, they're still open to the idea that it could be better from here. And I do think people are differently responsive to small changes in that. Looking internally, I'll be candid. I am a very, very responsive employee to when I feel like I'm not being treated well. I have a really hard time showing up fully. But when I am, I can be extremely productive. But I do have to be in that right headspace versus I have seen some other people who just they truck on no matter what. Whereas I could be a little bit more volatile. And it's not intentional. I'm not like, I don't like you. I'm not going to give it my all. It's that if you're not 100% there mentally, then it can be hard to give 100% of what you're doing. Especially in kind of more thought work type of things versus like, oh, I'm just going to pick up an extra tax return or something like that. And so what are these changes that you're implementing look like most often? Because there's the old trope of people are like, oh, stop giving us pizza parties, start giving us X, Y, and Z. But those things, they vary so much. Or sometimes even out of the employee's mouth, based off conversations I've had, they're poorly defined. They're like, stop giving us blah, blah, blah. But give us this abstract thing, do better. And it's like, well, okay, what does that actually look like? So yeah, what are these changes? Where do they normally start with a lot of the firms? Well, so once we gather that feedback, you're right. Sometimes it's not the clearest. Very clearly defined complaints, less clearly defined requests or what would make it better. But it really has to start at the top because, I'll sort of explain why, but if we were to go in and say, say one of the complaints is we don't get enough training. And we come in and we just implement training, sort of like take the bait almost. And we say, fine, we'll just revamp our training process and we'll throw a bunch of training. You could still have these underlying factors that are not contributing to the workplace environment that people want, like somebody emailing you on a Sunday and everything being an emergency. So we have to start at the top with getting some alignment and buy-in from the partner group about what we really want this to look like. What are those needs of the business also that we need to be balancing? Because it has to be both. So we have to start there and get the behavior change to start at the highest levels. And then it can start to flow nicely through the other groups. Because if you remember, I know I used to model my leadership against what I was seeing happening around me. Because frankly, I didn't get a whole lot of training about how to lead groups. So I was just doing what my manager did. And I assume that he was just doing what his senior manager or partners do. So that's how this becomes sort of pervasive in the culture. If we've got something not great happening at the highest levels, it filters down too. So we have to start there and get alignment and define what that is. So not just having company values, but also really illustrating for people what does it look like to live those values in the day-to-day of the workplace. And then we just have to start. So that may look like more tactically, it might look like partner retreats and getting that team to actually converse and also agree on the value of culture change and some of these soft skills or softer components of running a practice. That sometimes is pushback that I hear from certain leaders that maybe aren't bought into that or maybe are taking that old school business approach of, no, we're just here to serve our clients and make money and everyone else should just get on board. So it might look like partner retreats. It might eventually look like trainings at different levels, maybe individual coaching for certain people and maybe other systems or processes that need to be improved that can improve the day-to-day experience for your team members. And are you getting in as deep as the process level of things? Because oftentimes, I think one weakness in a lot of people who came up of the accounting route is not understanding how to leverage their time. And I've had some conversations with people. I'm trying to remember the name. I think I actually had a whole episode with Wade Runge, who basically, he'd been at a small firm that got acquired by a bigger firm. And they're like, hey, your bill out rates going from $300 to $900 an hour, right? It was like, whoa, how can I make sure that I'm justifying these things? And a lot of it came down to learning how to leverage your time, plugging in assistants or executive assistants and people like that a lot more. I think that that's a pervasive issue in a lot of accounting places that I see. But then at the same time, there's so much that can be addressed from a culture perspective already. So I'm curious to know where scope definition you're at. We do get into the weeds. That's when I talk about operationalizing and really thinking about what does that need to look like. So you gave a great example. You've got now this new mandate to be billing at such a high level. You can no longer justify doing some of the grunt work that maybe you were doing that was outside of the scope of your job description. We see that a lot, partners operating as managers effectively. So I like to look at that as an opportunity to change how it's almost like a catalyst to force the change that otherwise people aren't necessarily eager to make on their own. So that may force you to delegate more or to offload to an assistant or to be more strategic about what clients you say yes to. So I have found and heard from firms that I work with that they've sometimes hired consultants that come in and tell them, you need to change your billing rates to X. But they don't walk them through what that should look like, how you actually implement that in real life. And so what happens is they know what they need to do, they don't know how, so they don't do it. So I think it's absolutely important to get into the weeds because some of these other concepts like improving your culture and taking the time to truly develop an internal pipeline, that takes time. Time that most firm leaders don't have. So we've got to figure out how to carve out that time for the partners and for the managers and everybody who's going to be involved in changing the culture. We can't just keep doing everything the way we've always done it because they have to start putting effort and intention into creating this environment more strategically. Yeah, and are there moments in time where this tends to happen more, like where it does make more sense to revisit? I'm thinking like maybe your firm has just done an acquisition or you're going to change to becoming a remote practice or something like that. Are they often kind of waiting on these catalysts? Or like you said, is it often kind of like responsive of like, oh my god, we just lost this person that we were putting a lot of weight on. What do we do? I think unfortunately now it is a bit more reactive for most firms. Something happens and I think I really suspect, I'm just going to give everybody the benefit of the doubt, that this is on their radar. This is something they want to do and if there's not urgency around it, it's just going to keep falling down the list of the priorities and other things are easily going to leapfrog them on the list of priorities and get the attention first. So I like to think that it's on the list, it just doesn't get bumped to the top until something painful happens, like losing a number of people, losing a key person. But I would love to see more firms thinking about it absolutely after a merger, but ideally even before. I think it'd be great. Culture mismatches are one of the key things that cause a firm merge to not be successful or to be really, really rocky, and you'd have a lot of sort of waste along the way, right? Losing people and not, you know, losing clients, all of those are factors. But if you could be intentional about creating your ideal culture and also assessing whether the firm you're thinking about merging with is a cultural fit or if there are major discrepancies that are going to be hard to integrate, I think you could do yourself a real big service in setting yourself up for success in that merger once it happens. But culture integration after a merger is huge, and I don't think we put enough emphasis on it. Yeah. Yeah. There was a framing that I had thought of for some of my sales materials that might work really well for you, but it's one of those things to me where if you're doing digital ad spend, let's say, and you're spending $500,000 on digital ad spend, people are like, well, you'd be crazy to not spend $50,000 to then optimize your digital ad spend to make sure that that capital is being deployed properly. But in accounting firms, the biggest line item is always going to be human capital. But it's like, oh, we're spending $3 million in salaries a year, but we're not willing to do the $10,000 or $20,000 contract to make sure we're getting the most out of our people. And that looks like, again, that looks like compensation. That looks like culture. That looks like a lot of things kind of along those lines, process improvements, things like that. And so it's one of those weird things where it's like, as soon as you're spending significant capital on almost anything else, people are like, we're also going to have a little bit of spend dedicated to optimizing the thing. And then they kind of ignore or they ignore a lot of firms or a lot of places will ignore that kind of largest line item. And there's like not a lot of thought into optimizing your spend on that, which I think is a huge missed opportunity. Yeah, I think of it as protecting your investment, just like you would anything else you invest in in your life. I often will use the analogy of deferred maintenance on your house. Ideally, we're doing the ongoing upkeep of the house to keep it in good shape. You're not letting it just fall apart. And then when you're ready to sell it, having to scramble and invest tons and tons of money to get it back up to livable condition or sellable condition. So likewise, I absolutely like where you're looking that we are investing a lot to hire and recruit these individuals. We're spending a ton of time getting them up to speed, getting them to be functional contributors in the firm. And then to not protect that investment seems short-sighted, I would say. And I think if we take ourselves out of the position of running our own businesses in the case of these firms and think about the advice they'd be giving to their clients, usually they'd be advising their clients to protect their investments in some ways. And then it's just hard to take your own advice sometimes. Sure. Yeah. And I mean, now I'm kind of in the seat of running a business and I am like, it is so much harder to make those decisions that seem obvious externally. It would take me 10 seconds to answer a friend asking me that. But then for me, I'm like, oh, maybe. I don't know. And I'm thinking about it. So I do understand and I'm empathetic to that as well. That it's a lot harder when it's you versus when it's kind of outside looking in, which again, I think is a great place for consultants. And it's a place where that makes a lot of sense. I can also acknowledge that some of the work that we do is less tangible than the work accountants like. They like rules-based, black and white, very clear outcomes, very clear objectives. And when it comes to people challenges or things like culture, it's a lot more nebulous. I try to make it more objective and really clearly defined what it is we're looking to do. But I think when we see it as being a little bit more subjective, then it again, it's just another reason to put that aside because we don't exactly know how to tackle that. So let's go do the things that we are comfortable with. And to be fair, they have a lot of those other things, a lot of clients to serve, a lot of opportunity in the market. So there are a lot of those competing factors. But I would love to see more firms taking a proactive approach to this and not waiting until the last minute when then you have to make some big investments to right the ship. Yeah. Well, I like that kind of like home maintenance analogy you gave too, right? Like it's probably better to fix the roof before it has caved in and caused all this other damage in the area, right? So yeah, I'm all for that. And then for what you do, how long does a typical kind of engagement last? And then I guess, including maybe homework that you might leave firms with, how long does it usually take for a firm to be like, okay, we really need to address some culture things here? What's that time frame like until they kind of start to be like, okay, this is working or whatever that might be? Yeah. Well, I think you would find some studies out there that say to really change a culture in an organization, especially a large one, and have it become the norm, meaning it's not something we have to think about or put as much energy into anymore. That likely takes like five to seven years. This is not a short-term sort of quick fix. Now, all that to say, there are very quick steps that you can take to have an immediate impact and start to move in the right direction while you begin making those long-term changes. So we typically work on projects inside of this bigger umbrella of changing the culture. And those projects can last anywhere from three to 18 months, depending on what it is. So it might be revamping your mentoring program and performance evaluation. That's going to last anywhere from like six to 12 months. But it might be paired with that ongoing, uh, the ongoing partner retreats and partner meetings to make sure that we've defined where we're headed and implementing in the day-to-day. So I like to level set that a firm is not going to change from a culture that they've been in for 20, 30, 40 years. And then a year from now, we're going to be completely transformed. That's typically not how it works. But I will also say it depends on how dedicated, right? How, how much time and effort are you willing to put into it? And are all of your partners aligned? Or are we dealing with some, some that are really eager and others that are maybe a little bit more resistant or hesitant making that change. So all of those are factors. What I imagine contributes to the timeline too, is like, it's not just the partners, right? Like most of my day-to-day interactions that like, I despised at like the public accounting firm I was at, like had to do with like seniors, you know, the like snarky comment here or there of like, Oh, you know, you're leaving at eight, like packing it in early must be nice and stuff like that. And it's like, Oh my God, right? Like I saw you, you were on your phone all day. Like I actually worked today. Um, and, and some things like that. So it definitely does go through. And then I'm sure like at the end of it, there's probably still some bad eggs where like, you know, that probably does kind of make it a little bit more difficult to like get the changes to be a hundred percent effective in a sooner timeline. Cause some people take longer to learn, right? Or won't. Yeah. Or won't. Gosh, you're taking me back. I was just having like flashbacks my experience and, and like you said, those snarky comments and absolutely. That's why this really does have to be a process of getting everyone on board. Like I said, has to start at the top, but it does have to move through all of those levels because you can have people perpetuating, um, not an empowering culture at those lower levels. And that's where I see, you know, again, from those pulse surveys, we see that a lot where, uh, we'll get the feedback, love the partners that I work with, but I can't stand. Sometimes they'll even name names, but you know, they'll kind of point to, Hey, we've got some issues at these early leader levels. And that's just a matter of retraining. And in some time, in some instances, training in the first place to help people understand the impact of how they show up and the attitude that they bring into the workplace and the things that they say and how they say them. And so again, these aren't insurmountable challenges, but we have to put the time and effort into addressing it and giving people a structure to work inside of. Yeah. Yeah. A hundred percent. I couldn't agree more. So, you know, if you are a firm listening, um, check out, you know, if, especially if you're having some kind of internal issues, I do think some things can be best solved using kind of outside consultants. It can be a little bit easier. Plus it's really hard to find capacity. Some of the times internally to do this. And so having someone who will keep you accountable, keep this top of mind can be super important. So make sure I link all of your information in the podcast description, Aaron. If this sounds like your firm, make sure you check her out. And yeah, thank you. Thank you so much for coming on the pod. Thanks so much for having me. I really appreciate it. Thank you.