Practice Management Small Business

Shifting Your Practice to Advisory Services Isn’t About Dashboards or Apps

A recent study quantified the incremental revenue opportunity for advisory services in the small to medium enterprise market at $1 million per annum per 300 clients. For the average accountant or bookkeeper, this is a highly desirable, significant, and achievable target. It also explains why there is so much emphasis at industry conferences, in publications, and in our training bodies on shifting practices from compliance to advisory services.

Unless you have been hiding under a rock, you know there is enormous pressure to move away from low-margin compliance work, which is disappearing rapidly with the movement of data to the cloud and the introduction of machine-based learning. The change is already upon us—it’s inevitable.

However, the challenge remains: How do you shift the focus of your practice toward strategic and advisory services? The proposed shift makes perfect sense in theory, but it also means that you must learn a whole new way of communicating with and marketing to your clients.

Therein lies the real dilemma.

Thankfully, in most cases you are already a trusted advisor. However, there is no denying that you face stiff competition from other parties—who may be far less qualified but much better at marketing themselves as having the answers to such critical questions as:

  • How do I grow my business?
  • How do I get more leads and customers?
  • How can I use technology to increase my competitiveness?

In this new and highly competitive world of advisory opportunities, you must find unique and valuable ways to solve the big problems that keep your clients awake at night. But here’s the challenge: Business owners are already overrun with data and spreadsheets that they don’t really understand.

An Inconvenient Truth About the Financial Literacy of Your Clients

Last year, we conducted a study with 5,000 business owners and discovered, to our dismay, that 93% of them thought they could safely and successfully run their business off only an income statement and an aged receivables report each month. They were unable to answer basic questions about the difference between profit, cash in the bank, and cash flow. Most also assumed that more customers and sales was the only and best solution to fix a cash flow issue. This research squarely put into focus the seriousness of the financial literacy problem among our clients.

Based on our research, it’s likely that up to 90% of the entrepreneurs you interact with each day are financially illiterate. They cannot read their financial statements, so creating beautiful graphs, dashboards, forecasts, and key performance indicators (KPIs) may not be as useful or helpful as you think.

In addition, neuroscience has shown that the part of the brain that makes decisions and acts on them, struggles to understand numbers and words. This part of the brain is primarily a visual beast and is strongly influenced by pictures, video, storytelling, strong contrast, and emotions. This is a huge challenge for us as a profession because most of us have never been taught how to explain financial concepts to our layperson clients in language that they can understand.

Your clients desperately need strategies to fix the problems that keep them broke and awake at night. They need to know how to provide a better living for their families. And you need to find better, more impactful technologies and training to deliver these insights in a way that your clients can actually grasp, digest, and implement.

It Doesn’t Make Sense To Sell Fruit When Your Clients Crave Chocolate

According to Xero‘s 2015 Make or Break Report, 65% of business owners blame financial mismanagement for the failure of their business. Most of your clients are in financial pain and searching for the solution that will fix their business now. More often than not, this pain will be directly related to cash flow or working capital deficiencies.

Your clients will pay any price for step-by-step instructions to fix this specific problem, but they will only pay pennies for dashboards, KPIs, and graphs. Dashboards only diagnose pain. To successfully shift your practice to high-margin advisory services you must go one step further: You must provide a clear path to curing that pain.

The key to building a successful practice in this new, highly competitive world is to step back and recognize when you might be trying to sell fruit (i.e., dashboards and similar features that are only meaningful to you) when what your client really wants is chocolate (i.e., two or three simple, actionable strategies to unlock cash that is trapped in their business).

How Can You Deliver Two or Three Simple, Actionable Strategies?

Let’s take, as an example, the case of one of our clients. Steve is a commercial tradesman who makes custom cabinets, counter tops, and other kitchen installations for businesses in the hospitality industry. When he came to us, his business was experiencing revenue growth of 17.17% and he couldn’t understand why he was struggling to pay his bills each month.

After analysing his financial statements, here’s what we discovered:

  • Steve’s total receivables had increased over $36,814 in the six month, year-to-date period;
  • His customers took on average 29 days to pay;
  • While his sales were growing at a rate of 17.17%, his receivables grew at a rate of 131.22%;
  • Two of Steve’s regular customers were in fact the worst payers; and
  • If Steve didn’t make changes immediately in the way he operated his business, his cash balance was going to fall below zero in at least three out of the next twelve months.

Now it would have been easy for us to throw together some beautiful graphs, dashboards, and a 12-month cash flow forecast, and deliver it to Steve along with our recommendation to “Collect from your debtors quicker” and “Reduce your total outstanding debtors by $36,000 in the next 30 days.”

In fact, the software that we use with all of our clients produces all of these calculations in a matter of seconds.

However, here’s the important point.

If we had done that and then simply walked away, there’s a very good chance that Steve would have been in exactly the same position, and possibly even worse off, when we caught up again with him the next month. Here’s why.

Your client doesn’t want to have to learn accounting in order to grow their business. Steve hates looking at and dealing with his numbers. He often gets the terms receivables and payables mixed up, he is embarrassed to admit that he can’t read the dashboard, and he doesn’t know how to implement the instruction to collect his debt quicker.

While the graphs, KPIs, dashboards, and forecasts make perfect sense to you or I, they mean little or nothing to most of your clients. I discovered this the hard way, when I became a business coach eight years ago, after having practiced as a lawyer and chartered accountant for many years. Like most of you, I just assumed that if I simplified the numbers, put them into some sort of context, and packaged them up in a way that looked colorful and beautiful, our clients would surely grasp the insights and be able to implement strategies to fix the problems.

Truth be told, if we are going to be effective and make a difference, we must do a whole lot more than that. We must not only deliver the “nuggets of chocolate gold” hidden in the numbers, but also present clear strategies and step-by-step instructions so that clients can take purposeful action that boosts their bottom line and cash flow.

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About the author

Rhondalynn Korolak

Rhondalynn Korolak is the founder of businest®. businest® was selected as The App You Should Be Using at Accountex in 2016 and was also named one of the Top 10 apps in 2016 by Intuit QuickBooks. Dashboards only diagnose pain... businest® fixes it.

Rhondalynn is a lawyer, chartered (public) accountant, business coach, best-selling author, keynote speaker, and expert on business improvement. She has distilled the secrets to business success that she learned working with some of the world’s most successful brands, and produced a simple step-by-step process that any small business or accounting practice can apply to attract more high-value customers, close more sales, and boost the bottom line and cash flow.

Rhondalynn is the author of On The Shoulders of Giants, Financial Foreplay, and Sales Seduction. Rhondalynn can help you put strategies in place to grow your business and ensure that your customers would never think of going elsewhere.


  • Very insightful article Rhondalynn. I have tried the ‘colorful reports’ approach to value-add my services and have always been met with lukewarm responses at best from my clients. This year I am focusing on seeking the true value for each client and will go the step further to deliver that for them.

    • Thanks for your comments and insight Fiona. I found much the same. Most of my clients could not remember the gist of what was reported in their dashboards 48 hours after the meeting – even though I left the reports with them. That got me to thinking – maybe we need to change the way we deliver the information and focus more on (1) gaining leverage and (2) giving them actionable steps to implement the crucial changes. Keep me posted as to what you discover as you head down the road to “true value”….

  • A good article to know how to shift the focus of your practice toward strategic and advisory services and grow your business? All Accountants and Bookkeepers need to have a read and decide what they want to do with their businesses moving forward in 2017.

    • Thanks Dianne. We are all in this together and we can benefit from sharing best practices and encouragement. The Centre for Economic Development in Australia released an extensive research report here in Australia. It suggested our profession (as we now know it) may not even exist in 10-13 years due to machine learning and a.i. If this is true, we must take action now to move into advisory services. Unfortunately, many are fearful of the change…

  • This is a great article Rhondalynn. I definitely find this is an area that needs to be improved upon. I was stuck trying to find a way to bridge the gap between the actual number crunching and the explanation. I am excited to have a tool to help me present it easily to my clients.

  • This article resonates with me. I wonder if there are any stats tracking the movement of accountants and bookkeepers from compliance to advisory services? I dare say the take up rate is probably slower than most would think (or are led to believe). Someone mentioned at accountex last year that the penetration of apps was still well below 15% of the total SME population… so that says to me advisors are slow to adopt.

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