The Modern CPA Success Show: Episode 106

In this podcast episode, Tom Wadelton interviews John Fonger, consultant, coach, speaker, and owner of WTS Enterprises, who specializes in helping busy entrepreneurs develop and implement effective systems in their businesses. John discusses his methodology based on the book Work the System by Sam Carpenter, which aims to help entrepreneurs work on their businesses rather than in them. He emphasizes the importance of having clear systems, documented procedures, and a systems mindset to increase productivity and reduce workload. John shares examples of clients who have successfully implemented these strategies and highlights the benefits for accounting firms.

intro (00:00:00) - Welcome to the Modern CPA Success Show. The podcast dedicated to helping accounting firms stay ahead of the curve. Our mission is to provide you with the latest and greatest insights on cutting edge tools, innovative marketing strategies, virtual CFO services and alternative billing methods. Join us as we change the way people think about accounting.

Tom (00:00:22) - We have a really good modern CPA success show episode for you today, so we're talking to guests Josh Fonger and Josh is a consultant, a coach and a speaker. His work is based on a book called Work the System, and that's by Sam Carpenter, and he'll talk about that in here. But if you're thinking of your business or a client's business and you're thinking of someone and you've heard these terms before, I'm working more in the business than on the business. I'm too busy. I don't have systems in place. And this is exactly the episode for you. We've heard about this before. He'll reference a couple of the books that talk about this. It's a common problem. I think Josh described in a simple way that people can say, Yeah, I could see how that could be solved and talks about both book and consulting that could help people with that as well as just some practical ideas where you could probably do a lot of these things on your own.

Tom (00:01:10) - So as accountants, I know we often talk about being really busy. There's a busy season. We have too much to do. We're probably too engaged in the business. If you're an owner and would like to step back and do things that you think help make the business work longer, and here's a solution that can help you do that. So I really hope you enjoy this episode. All right. Welcome to this episode of the Modern CPA Success Show. I am Tom Walton. I work with Summit Virtual CFO by Anders. I'm a CFO in my role, have about 17 clients who act as their business consultant and also as their CFO. I'm really excited today because we have something I think can help people's clients and their practices if you work within a firm. Josh, welcome to our program today.

Josh Fonger (00:01:51) - How are you? Glad to be here.

Tom (00:01:51) - Can you just tell us a little bit about yourself? Let people know who they're listening to today?

Josh Fonger (00:01:57) - Sure. Yeah. So I'm the coaching consultant that really works with folks through this book right here.

Josh Fonger (00:02:03) - Work the system. So a lot of folks know about it. And it's fourth edition. It's been around the world for the last ten plus years. And we work with busy entrepreneurs, which is almost everybody. Yeah, maybe the unique thing is that the entrepreneurs who work with are ready for a change, right? And they know it's time to do things differently. And so they they're usually ready to stop taking the easy path and maybe take the more mature path, which is to develop, you know, the systems of the business. And I've been doing this with Sam Carpenter for Guess over ten years now. Before that was kind of a traveling business consultant, um, in the flooring industry. So have cloud companies and help them with their inside sales and outside sales and their projections and do some financial forecasts and help through bankruptcy kind of whatever they needed. Um, and the problem I kept realizing is that my clients, when they would have success after I'd work with them, come back six months later or a year later.

Josh Fonger (00:03:09) - Those problems would come back and realize that wasn't really getting to the root cause. Right. And that's where the book you know, what I do now comes in is that it's about actually developing and documenting the systems of the business. And there's a very simple methodology. We take companies and owners through and if they follow it, you know, this is what we've measured over the years that naturally they're going to. And it's the premise of Sam's book is they're going to make more and they're going to work less. And we find that a lot of people like that message. And so that's what companies mechanically do.

Tom (00:03:45) - If we talk about who. So one of the things we really encourage people and it's more accounting firms that are working things, is to really pick a niche and how much better you can do. So. Is there a niche where you're saying these are the people where the book really helps them take off? Kind of what is that group?

Josh Fonger (00:04:00) - You know, I wish you know, we put the book out there and get really involved with Sam, I want to say around 2010.

Josh Fonger (00:04:09) - And you know, we have some law firms were interested and some appraisal firms and a chiropractor and that it was an SEO consultant and this and then we're like well maybe it's, you know, people in the construction industry and. It's any it's really it's kind of like getting things done. You know, it's anybody who wants to be more productive, more effective as an owner. This methodology works. And so people who are familiar with the book The E-Myth by Michael Gerber, that's the most common thing people say is that the book Work the System is the book. The next book Michael Gerber should have written, which is how do we actually how do we actually do this? How do we actually, you know, not just theorize about it, but actually put these things into practice? And so, yeah, so it really is like a it's a fundamental business block or business book that think that. Everyone should read and they're going to take something from me. I work with some high tech companies that are scaling quickly.

Josh Fonger (00:05:09) - I work with some low tech workers, some farmers. They're just trying to keep things. You know, one was like a sheep farmer, you know, you name it, it's they all get a lot of value out of thinking differently. Having a systematic strategy, principles and procedures. And then my job, which keeps it exciting, keeps me on my toes, is I get to take all those ideas, those system improvements, and then channel them into any client that I'm working with. I do a lot of personal consulting. And so, you know, like I do have, like I mentioned, several accounting practices I'm working with right now. I usually always have at least a couple that I'm working with, but I'm also working with, you know, a nonprofit. I'm working with a home flipper. I'm working with somebody that, you know, they develop car washes, you know, yeah, someone else has a writing company. So like, I've got a lot of different companies I work with, but it's about me taking the principles and ideas.

Josh Fonger (00:06:04) - But of course they know their industry, right? So, I don't know as much.

Tom (00:06:10) - Yeah, not really a niche from an industry, from a company size. Is there one? And I would assume this will work across any company, but is there a particular size? We were saying this is where it seems to be really an order of magnitude better for it than. 

Josh Fonger (00:06:22) - Yeah, yeah. In terms of people who we actually work with, um, it's, it's when owners become the yo yo business as what we call it. So basically if you're in startup phase, you're kind of your to work with some startups but usually they've, they're just going to hustle and grind and figure it out. They make a lot of mistakes, a lot of experiments and they're a lot of gyrations and maybe they closed down the company and reopen it under a different name and they kind of they figure it out. And then once they have some kind of consistent way, some consistent way of making some sales and delivering on those sales, maybe that's six months in, maybe it's a year or two in and then they get into a groove and then they will plateau at some point and it's because the owners of the bottleneck.

Josh Fonger (00:07:06) - And so that plateau point might happen at quarter million, half million, 2 million, 5 million, whatever that that plateau mark happens where they can't really work any more hours, they kind of hit their max there and the money seems to all be gone. So there's really no extra like money to spend on more people. So it's not like I can't hire away this problem and can't work away this problem. And when things get tight, I'll work really hard and sales go up, but then the owner has to jump in and figure out how to deliver on those sales and then service those sales and then the sales go down and then they're kind of they kind of hover at that point. Yeah. And so some companies can stay at that point the whole time, right? They can just kind of stay steady at whatever that number is and then they go out of business or the owner sells it or retires, whoever it is. But we work with companies that are ready to go beyond that point, whatever that number is.

Josh Fonger (00:08:03) - And so it's not so much how long they've been in business, it's more once they've plateaued and the owner personally reaches a breaking point. So it is tends to be smaller companies, it tends to be private companies not public companies. So most of them are board directors or anything. So it's smaller private companies that the owner like just brought in a client yesterday that. It's a cleaning service. Right. So home grown. Think they have ten employees now, But now they're like, okay, we actually have to put some structure in place. We actually have to put some job descriptions and some hiring practices into place, and we need to have some checklists and some standards with how we actually clean these rooms. And just it can't just be based on our gut and winging it. And they're a friend of a friend would be like, actually make this a real business. And yeah, so that's usually when get involved.

Tom (00:08:58) - That's a great description. You know, we often talk to businesses about the valley of despair and it's kind of you get to a certain size where that next growth is hard to get through.

Tom (00:09:07) - And the first one you mentioned is often the owners wearing all the hats. You've expanded beyond that point. So when you start adding people, it's both expensive and you're carrying the company, but even when you can afford it now, communication gets to be a problem. But as you get that figured out, when you maybe go 3 or 4 times as big, now you've gotten that much bigger and it seems to make total sense to say, well, that next valley is likely. You've sort of outgrown again those systems that worked before. And it suddenly things it used to be one person, now it's four. And communication has gotten to be one of the real challenges. It's in there. So it's just interesting here you describe and I can see pulling in an external person to say, help me figure, figure this piece out.

Josh Fonger (00:09:46) - Yeah, help me figure it out and then help hold me accountable. Right? Nowadays, information is cheap. It's everywhere. You know, you can find out what to do, how to do it anywhere you want to do it.

Josh Fonger (00:09:57) - It's more about can somebody actually just help me do it and hold me accountable, do it and then help me do it in the right sequence and not just talk about doing it, but actually work through it. And so implementation is obviously critical with any idea. And I think that this is just another one of those business ideas that people are like, Oh yeah, really want to do that, but they have a hard time actually executing on. And so that's a big part of what I do.

Tom (00:10:25) - Yeah. Two of the two books you mentioned, we actually are big proponents of so getting Things Done by David Allen is one and we actually had him on our podcast talking about that and how that could help service business. And then also E-Myth.

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Tom (00:11:19) - So I'm curious with those two. You know, get it out of your head as a big getting things done piece. All the systems and things are big for E-Myth. So your book, I'm guessing you're not saying go through those two first before you get to yours, is that right? So how would you how do you position yours relative to those two?

Josh Fonger (00:11:35) - Uh, sure. I mean, business owners like to consume information, so you can do that whatever order you want to. Okay. Sam's say Sam's book Work The System, which didn't. Right. But I'm the proponent of getting it out there is it's a complete package in that it walks through. I'll just summarize it in just a minute here. It walks through a busy business owner, which is Sam Carpenter, and a real company which is central, which still exists today, and where he was working 100 hours of work, 100 hours a week at work because he literally lived there.

Josh Fonger (00:12:09) - He slept there. He just worked all the time. There was a 24 over seven answering service and so pretty hellish environment. And so he had been just working as stay off for like 15 years with this business. And it reached a certain point where he decided like, I just can't work anymore and there's no extra money. I'm going to miss payroll. I've got to do things differently. And up until then, he realized that he enjoyed always being, you know, the hero, you know. So if the printer breaks, you can fix it. If the client is a problem, he can fix it. If he needs to do this, he could jump in and do whatever needed to be done. Think he had maybe 7 or 8 employees at the time and he just realized like, this can't work anymore. And so he thought I was going to lose the business. And so in the book, he reaches that breaking point and he has this vision in the book or dream, where basically, as a table laid out and on the table are a series of parts, all the little parts and pieces that make up his business.

Josh Fonger (00:13:13) - And his theory was it'd be to these pieces that I see in my business if they were all perfected like little machines and put them back together, maybe I could have a perfect business. And so that's what he went about, trying to put that into place. And so as he was able to, through another miraculous event, you know, make payroll. And so it's all a detail in the book there. Um, he went about in fixed one system and the system he chose to fix was depositing checks. And this is, you know, maybe two decades ago he ran that now depositing checks into the bank, which of course is a little bit easier nowadays. And because they got maybe 300 checks a month, maybe more than that. Okay. And sometimes they would get lost. Sometimes they didn't know who to account for, you know, who, which account. And anyways, it was kind of a complicated mess. And so he spent maybe three hours a week doing that particular process every week.

Josh Fonger (00:14:10) - And then he realized if I wrote down the steps to do this, could someone else do this? And of course the answer is yes. And then he developed this system and someone else ran the system and he realized, oh, I just saved three hours of my life for the rest of my life. You know, maybe there's another system I could develop and do. And so then he just kind of, you know, got got him thinking that he could actually just work himself out of a job by working those systems, hence the book work the system. And so as he went about doing that, any details how to how to lead and how to manage and what the different systems are of your company. But he went from 100 hour workweek to, you know, now he likes to work. So he does maybe two hours a month with the business. He still owns it, but it still runs and it's more profitable today than ever. Think as incomes like 100 times higher than it was back then.

Josh Fonger (00:15:01) - So, um, but the point is, the company now runs itself and is built on these systems. And so I think it's a great I think it's a great story. I mean, people, whenever they read like, okay, this is this is me, I'm at Sam right at this point right now in the book. And so they can they can relate to that. They can relate to that pressure. They can relate to being maxed out and they can relate to the fact that they know they need to do things differently. They don't know how. And then it just tells you what you need to put in place. You need to have a systems mindset. You need to have a strategic objective, you know, a clear vision of where your company is going. You need to have general operating principles. You know, the rules of how this company is supposed to run, and then you need to have procedures and they need to be documented. They can't just be in your head. You can't just be, hey, my top sales guy is good at selling, so it's fine.

Josh Fonger (00:15:54) - Well, what if he stops working? You know, he leaves and then your company's in trouble. And that's the way so many small companies are, is they're. They're one heartbeat away from disaster. And I work a lot of those companies where that person left or that person um, you know sometimes they'll get pregnant and just not be available for a while or something. Like that will happen. A couple of companies that work with one of the general managers died abruptly and no one knew what they did or how they did it, you know, So just things like that. And so I wish it wasn't the case. I wish I worked with them before things were really bad. But usually I get them when they're bad and then we put out those fires, then we start to build systems.

Tom (00:16:39) - Yeah, that's great. It being a story is probably really good. And as you describe that, Josh, one thing I think of was I was at a conference with one of our owners, Jody, and met one of his peers and we were talking to him and for the first ten minutes I thought, this guy sounds incredibly successful as he went through the different roles he had had and he had stepped into organizations and taken over as their CFO and then step back out and things like that.

Tom (00:17:01) - And it sounded great. And then toward the end, he said, And I'm really in trouble. He said, because I've grown this company and no one can do what I do and I can't step away and I can't grow it. And I've been thinking about systems for years and I can't do it. And for me, it was such an instant change where I went from, oh, I was like, Anyone wants to be you to, Oh, you've got a real problem on your hands and you're seeing it. But so I would guess I'm getting to a question. You're going to walk in and say someone's working 60 hours a week, 80 hours a week, 100 hours a week. And what you're telling them is let's focus on systems. And the first step is probably, how do I add on top of that to do something different? Is that one of the challenges you work on?

Josh Fonger (00:17:38) - Oh yeah. Oh yeah, definitely. So one of the first modules we take everyone through is this exercise called Making Time, because there's time in everyone's schedule, they just don't know it and try to break apart what they do and isolate those separate things and say, Actually, you don't need to do this anymore or this could be automated, this could be delegated this.

Josh Fonger (00:17:57) - And then we pick a system and then we, you know, stop being involved with that particular system in order to free up some time, some capacity because, yeah, to make this shift will take some time. And it's funny because the accounting firms took on, I brought them both on think it was I want to say it was like February, March. But they were both like, it's going to start getting really busy here. And then it was like, you know, yeah, it was. It was the tax season and it was very busy. But they still they still stuck with it. It was because we built capacity quickly. But yeah, so we do help people see that and it's, it's always something very obvious to me maybe because I've done this a long time, but also just because I'm an outsider and maybe someone else would see it too. Um. And one that everyone would understand is that I work with this home flipper. And one of the things that he does and he generates a lot of revenue flipping homes, is that he would do these emergency runs to Home Depot or Lowe's and pick up materials and for the different job sites and drive it to the job sites and bring out the materials because it's a big rush because, hey, we're out of this or any lumber or whatever, whatever it is, and said, So there's so-called emergencies every week.

Josh Fonger (00:19:10) - He's like, Yeah, sometimes like 2 or 3 times a week. And like, could they be prevented? And of course the answer is yes. And then said, Now, is it possible that someone else has the skill set and ability to drive the Lowe's and pick up material and drive it to these job sites? He's like, well, you know, it's just so hard. I'm like, Do you think I could do it, you know, like tomorrow? And he's like, Well, there's just so many things that, you know, go on. I'm like, okay, so we're going to document a system and how to, you know, because he had a special account there and a special credit card file and I'm like, But you can develop. And so, you know, within a week he did. And then he had someone, you know, $20 an hour who had a truck, who could do it, who was reliable and just dropped off materials for him. And of course, they realized they didn't have to have so many emergencies.

Josh Fonger (00:19:54) - So the Mercedes were dropped and they had someone else do the running. And all of a sudden this guy had like five hours more a week was like.

Tom (00:20:02) - That's a huge amount of time, right?

Josh Fonger (00:20:04) - Yeah. And it's like that, wasn't it? It cost him a little bit of money or he had to pay someone else to do it, but it was totally worth it because once owners realized that the value of their time to the business is, you know, whether it's 200 or 300, $500 an hour, whatever it is, everyone else in their entire company cost less than that. So really, anything possible that they can get someone else in their company to do is worth it, right? Because their time is the owner is the most valuable time. And so I'll hear this all the time is they'll say, Oh, my employees are busy. I'm like, Well, you are busy and your time is actually worth even more than their time, right? So the whole point is you have the free time.

Josh Fonger (00:20:45) - And when I'm going through this analysis, usually the other obvious thing is that things that owners are supposed to be doing, you know, business development and trying to recruit and work on the culture and the strategy and and kind of looking at the landscape, you know, one year, five years in the road, usually no one's doing any of those things. The owners are just doing the day to day things. And I'm like, well, this company is great, except there's no there's no leader actually is. No CEO actually is no owner because no one's doing those things and that's why you're still in the same spot. And so they have to unlearn some of the things that have gotten them to this success point and then learn new skill sets that maybe they're not used to. And so it's a transition. I mean, the systems mindset that I'm not talking about, you can have it in an instant in terms of seeing your world as a collection of systems, But implementation is what takes some time and that's what you know, that's what I get to do with the coaching.

Josh Fonger (00:21:46) - Consulting is just kind of walk with people through the transition so they don't turn back to what they're used to and actually stick with it until it actually really works for them.

Tom (00:21:55) - Yeah. And you mentioned account or the busy season, which is one thing that we have or see. So we do a lot of consulting with other accounting firms and helping them with moving to a virtual CFO. The number of times we've heard people saying, I'm going to ramp up the marketing like when the busy season is done, but the busy season takes so long. And then from CPAs you'll often hear, Well, there is no more busy season. We're just busy all year because there are so many extensions and things like that. And so not surprising. You'll talk to someone a year later and they're saying the exact same thing and it may be something like, I'll put out a blog post once every three weeks or something that seems small and you're like, okay, it's been a year and you haven't been able to carve out that one hour to do that.

Tom (00:22:36) - So I can see the value of that accountability. I'm going to follow up and get those things done.

Josh Fonger (00:22:42) - Yeah, well, yeah, and I think you probably notice it too. I mean, the account that I was talking to this morning, he's on this. It's a new client. He's on this routine where he will work, you know, whatever normal morning, normal day. But then I'll go back home, but then go back to work again. Back to the office from like seven until 1030 a night every night or 11. And it's like, well, you know, like, how long can you do that? Right? And you still be trying to get those returns out, you know, the ones that were an extension. And so, yeah, there usually is the capacity and and you've already kind of mentioned it is it's a lot of things when you do consulting, when you do consulting, you sometimes just realize, hey, you know what the issue is? You have a pricing issue, you know, and that was the case in this particular client is they're just priced too low and and prices last five years.

Josh Fonger (00:23:35) - So you know inflation, cost of labor, everything else is going up. And that's where they're having to put all the hours in. Themselves there. There's no proper left. And so anyways, there's always there's always some obvious things from an outsider that people inside just can't can't see. And I think that's what's one of the big the big values for people like you and me bring is like, Hey, um, I know you think you hit a wall, but there are opportunities still.

Tom (00:24:05) - Yeah. When you work with accounting firms, are there a common certain systems that you can give people a good idea? When you say system, what you're thinking of that are normal ones you focus on? 

Josh Fonger (00:24:16) - Yeah. So it's probably the easiest way for for anybody is to think about the client lifecycle. Like there probably is some repeatable system or effort that takes for someone to even be aware you exist. And so once they see you, there's some system that actually repeatedly lets them know to call your contact you. And then at that point is probably some regular repeatable thing that as you connect back with them, maybe a phone call email appointment and then at that point there's this is kind of like a selling system, right? And at that point there's a consultation, there's some kind of discussion and then a presentation and then they sign on the dotted line.

Josh Fonger (00:24:56) - They become a client. You know, like there's a process there. Each of those steps we would say, is for one, it's a macro system, you know, the client lifecycle. But each one of them is a system of repeatability as well. So like hiring an employee, like how you do an interview every single time you do an interview, you're going to do an interviews again and again and again. How about you just document that process and then you'll get really good interview, right? And so the point is we want them to get not just wing every single thing they do, but actually get really good at the things you do. And maybe that means you need to do less things, but if you do them better, you will charge more for them and you'll have more capacity to get more of those clients on. And so that's again, what we try to do is simplify companies, reduce complexities. It's one of the keys to Sam's book that people don't always think about is that because he focused so much on being the number one in his industry as an answering service, um, he can charge a lot more money than anyone else because once you're the best of something, people are like, Well, I could use this firm or that firm, but I just want to use the best firm.

Josh Fonger (00:26:13) - So I'm just going to pay a little bit more because relative to all of their expenses all year long, it's not that big of an expense. Um, and so, and because they're very good at what they do, they can do it for half as much work as other companies do, right? So they charge twice as much, but they do it for half as much work because they are very systematic about it. Right. And so that's what that's kind of the key thing there. But. Yeah, I forgot your original question with regards to accounting firms, but the separate system. So yeah, there's different systems.

Tom (00:26:46) - Yeah. So you think you've described your process taking them through that life cycle and I assume through that which are the most important, which are the most painful, which are you involved in that maybe you shouldn't be as involved? Is it things like that?

Josh Fonger (00:26:58) - Yeah. Oh yeah, definitely. You know, I think for a lot of the small accounting firms that I'm noticing is that they think they need to be involved in meeting the client face to face if it's a localized accounting firm and building this relationship with them.

Josh Fonger (00:27:12) - And so instead of the client wanting to work with their firm, the client then wants to work with them. And that's a problem from the get go. And then also being overly responsive. And so instead of the client coming in, then they, they, they're going into your machine that you're in control of, right? The client's dictating how you run your company. So like one recently I just said, hey, if anybody wants to work with you, you know, current client or prospective client, they have to book on your calendar a specific time. And if it's a non client or it's a special thing, they have to actually pay for the time as opposed to people calling you and emailing you, interrupting you whenever they want to. However they feel like it probably not paying you for your advisory services, which are the most valuable and you're just always in reaction mode. Like you're they're their slave and you're like an employee in their business. But instead, this is your business. So being in control of your business is a good thing, not out of control.

Josh Fonger (00:28:17) - And so the whole point is I try to get to know, like, how about you, you run your business for you, and then your clients need to enter your ecosystem right on your terms. Now, that could be great terms for them, but they have to be great terms that are efficient for you too. And so just setting up those those kind of barriers and boundaries where like someone else can do a large portion or maybe all of the onboarding and the more of that, again, that can be systematic, the better, as opposed to every single time it's random and every single time it's urgent, every single time. It's, you know, requires the most highest experienced person to be involved in. You actually want to how do we set up our onboarding system that the least experienced receptionist can run it because we have simplified it so much. And that's the goal is always to figure out how to make it the simplest so that any good person could do the work.

Tom (00:29:16) - Yeah, and I'm sure what you would find is then clients end up being more satisfied when what they get is a predictable level of service and a response time that they expect versus at least what you described before is this kind of putting out fires mode, which if you got ten fires, sometimes they probably get a really quick response and sometimes longer.

Tom (00:29:35) - And what you might find is somewhere in the middle, if they know what the response is going to be, they're probably happy with that.

Josh Fonger (00:29:41) - Right? Exactly. Yeah. It's just it's about being consistent with it. Exactly. So if they know that you always respond in two days, well, then that's great. Or one day. What if it's like, hey, sometimes it's within one minute and sometimes it's, you know, half hour and sometimes it's two days and then they can't trust the relationship as much. And so, yeah, I think that it's the consistency is a huge part of it and find that for localized firms, the issue is that people just pop in like they used to because they're they know you and they've known you for years and this and that. And so instituting new boundaries and standards seems to be difficult as well. And so sometimes. You know, getting the owner to move to a different space or getting them to not physically be there or things like that can can help make the transition to getting, you know, all emails file to a standard email address, not their personal email address.

Josh Fonger (00:30:38) - Because these people that are used to just working with the owner, they need to get used to not doing that anymore. And when the CPA firms got, I don't know, 500 or 1000 or 3000 accounts that it doesn't work anymore, like it just doesn't function. And in the end, the people want good service. And so they'll they'll go with the change, but the owners just need to. Stick to it and make it happen.

Tom (00:31:06) - Yeah. Yeah, that completely makes sense. So is I hear systems. We're going to design it, we're going to document it. That can sound sort of overwhelming and complicated. This is probably where you help, but I'd love it. Maybe it is, but maybe you'll tell me. Okay. People probably do overthink this and would think accountants, if you have a chance to overthink. We're probably the group that does.

Josh Fonger (00:31:26) - Yeah. A lot of spreadsheets. Yeah exactly. Yeah. Try to make it as it first. Doesn't have to be painful. And it also it's more of a way of first, it's a way of thinking and it's a way of life.

Josh Fonger (00:31:39) - And that's probably the number one initial aspect is if, if you have clarity of focus and the principles and your team understands that, hey, we're not going to just just literally this morning on the same issue where, hey, we just interrupt the owner whenever we feel like it. It says, Oh, our system is that we really need the owner for lots of different things because it's chaotic in this company. Okay. Here are your time slots in the morning and here your time slots in the afternoon. Otherwise you can't interrupt me because I'm focused. Okay. Wow. We just feel like it's more of a systematic every day. We know what's the same. He knows when we're going to interrupt him. We know when we can bring our questions. Now we have a system to how we're going to flow through our day instead of constant interruptions. Right. And so it's just it's developing. And what are the best practices and systems of your daily cadence? You know, the when do we have appointments, When do we, you know, when do we not have appointments, When do we have focus time? When do we answer calls? You know, so it's it's trying to get into that that level of initial just looking through your day and then it's looking through the work and then, you know it's just start small Like you're not going to write document 400 procedures and won't go through a long story about a company wanted to do this.

Josh Fonger (00:32:58) - But you're just going to start with the one that matters most. And so if you you know, if you've got someone who, you know, we've had this happen where there's an accounting firm closing and then another one was going to be taking on a bunch of their clients or clients at once, you know. So, okay, well, we're going to be onboarding a lot of clients. Well, you should probably document that process to start with an outline. Okay. What's going to happen two weeks before a one week before, day of day after week after two weeks after, like one of the things. Okay, now what are those things that we can not have the owner do? Okay. You know, Shelly can do this and Julie can do that and. Okay. And do we all know how to do that? Okay, let's here's what the action needs to happen and then, you know, work through that. Then you're going to find out, okay, instead of the owner literally onboarding 200 clients by themselves, all of them, Um, hey, we can actually divide up the work because we know who's in the separate pieces that make it up.

Josh Fonger (00:33:51) - And then and it's like, Well, can we do that better? What can we do that better? And then once it's documented the first time, which I always recommend, the first time you documented, do it as simple as possible. Don't try to do massive innovations. Don't try to perfected. Just say like, What are we doing right now? Oh, we're doing this way. Great. Now that it's we all know that the first thing that's going to happen is people going to look at it and say, I'm not doing it that way or I'm doing it differently. Okay, well, like, okay, I didn't know that. That's good to know. How are you doing it? Then they will add their ideas to it. And then we always have a principle. You know, the best idea wins. Okay, so now we have a better we all learned a better way to do it. Great. And we've all committed strategically that at this company we all want to do things the best way.

Josh Fonger (00:34:32) - So we've all we're all going to conform to this best way. It's in writing. We all collaboratively wrote simple enough, but then it's going to be a few weeks go by, Hey, you know, there actually is a faster way to do this. You know, actually, instead of taking an hour for those client meetings, we can actually does in half hour because we just, you know, working with this hearing aid center and they've done an hour and a half presentations for every single client and said, well, is there a way to do it faster? Turns out you can do it in 45 minutes. It's like you guys been doing an hour and a half assessments for like 20 years now. Like, well, we just always done it this way. It's like, you know, like the point is there maybe you could onboard a clients instead of in the office and you could do them virtually, you know, instead of doing it, this maybe it could be shorter. And the whole point is that they need to first figure out what are we doing? Can we all make sure we at least have some standardization of what we're doing? And then could we do it faster? Could we do it higher quality? Can we do it in a way that it's gonna be more profitable? Um, and it doesn't mean you have to.

Josh Fonger (00:35:32) - This is what Sam said, is that the systems of your business are already there, so it's not like I'm going to come in and say, Hey, you have to create systems out of scratch. It's like they're already happening, like. You're already processing people's payroll. You're already, you know, getting their PNL and balance sheet set up. You're already doing it like the work is already happening. Now we're just going to get better at the work by standardizing it and optimizing it. So it's not like we have to revolutionize your business all at once. We're going to revolutionize little pieces of your business one at a time, and that's what's going to make the difference. And that's the hard work that most people aren't willing to do. But it's the only work that's going to ultimately allow the owner to delegate more and more away and know that the quality is going to stay the same or get better with time. And that's the key is like if you would like to have a life outside your business and grow, the work is going to have to stay the same quality or better and you're going to have to be able to watch it less and less and less.

Josh Fonger (00:36:33) - And that's going to only happen if the culture and the strategy and the systems are set up this way. And so not everyone wants to have, you know, simple. They just. They want to be in the mix every day and just don't work with them, right? So yeah, so anyways.

Tom (00:36:53) - They'll continue on. So then with this idea of sort of continuous improvement, is there a foundational piece that you put in place as you start around after action reviews or reviewing and getting things documented, then iterating to make it better? It sounds like something that you get the whole team used to doing.

Josh Fonger (00:37:08) - Yeah, I mean, there's, you know, out of the books and it the larger the company is, you know, you have thousands of employees then there are lots of these really important structures you have to put in place. But usually when the companies are smaller, they're going to kind of tell them where the priorities are, like where the fire is, where the problem is, like where the issue is like like, you know, it used to be getting, I don't know, 500 leads a month and we'd be getting like ten leads a month.

Josh Fonger (00:37:34) - I think we need to investigate the systems that set this. You know, then they'll be able to sniff out where the issues are. Now, once the core systems of the business are documented and they have been used and there's hopefully just regular improvements being made, then we'll set up as measurement systems. And so like the core things of your business you want to measure, and then you'll be able identify when things are going haywire and you can also set goals and then drive towards them and say, Hey, we need to. Put some some gasoline on this particular system because it needs to drive us to these numbers going forward. And so you can start to really control where your business goes because, you know, the systems that delivered the results. And so therefore, you can, you know, modify those systems to deliver different results because you actually have some knowledge of what it is as opposed to just we want to grow. And so we all need to work harder, right? That's a little bit too generic.

Josh Fonger (00:38:29) - And so also whenever I finish up with a client, we want to end with maintenance systems because if you do develop systems, whether it's ten or you documented 500, you want to look back on them ideally in the six months to 12 month range to pull them back up and say, Hey, are we still doing this way? Is there a better way to do this? Is there a faster way to this is a way to improve the client experience or make it simpler or improve our experience? Doing this is a way to use technology is a way to automate it. You know, just going to look at it and then sometimes it's just, you know what? We still change the printer. Toner the same way we did last year. Okay. No big deal on the next one. Yeah. So most of them are just like, yeah, so it's still the same. We still ordered lunch the same way, so there's nothing there, but some of them there is, and that can be the turning point.

Josh Fonger (00:39:19) - I'd like to share the story with a a small machine shop that I was working with where they just documented the, the the the shift change between first shift and second shift. And there's 20 employees on the machines, the first shift 20 and the second shift. And they had a 15 minute overlap. Okay. That's we documented that overlapping of shift where they were handing off the work and what they were doing on the different tools sets to the next thing. Um, we realized that actually there's a lot faster, a better way and it only had to be a five minute overlap, not 15 minute overlap. And so that ten minutes of overlapping time times all of their employees times. I don't know if there were seven days a week or now, but they were open a lot. It was $100,000, like $100,000 of wasted payroll. You know, a year, every year. And you've been doing this way for decades, like. So sometimes it's not the problem of the business. It's just, hey, we could do this better if we just actually took some time to focus in on it.

Josh Fonger (00:40:24) - And so everyone already says they're working hard and everyone says that they have a process. But once you document it and you have some focus time on it, there's always a better way to do it.

Tom (00:40:34) - Yeah, that's great. So for people who are listening on, yeah, I'd like to be in the category if I've done this well, but I'm probably more in the category of need this. What is your usual recommendation for like very first step that people have? Is it a it's read the book. It's reach out to me kind of what what is your take that first step look like.

Josh Fonger (00:40:53) - Yeah well I mean I'm podcast always tell people to go to enterprises because they can get the summary of the book download for free. And of course if they want to contact me, they can they can do that there. We've got links to other resources and business systems assessments and always everybody get the book, you know, you can go to work the system which is Sam Carpenter's website. He also has the book summary and you can get the book on Kindle or audio or if you want.

Josh Fonger (00:41:24) - But it's a I would say do it, you know, put that on your reading list, Go through it, listen to it, think about it, consider it. But yeah, if you want some help, then just connect with me.

Tom (00:41:35) - Yeah. And the way you've described it, the iterative approach of let's start here and we'll get you the one example. First example, someone got five hours in their week, so that's a huge benefit, but that allows you to then start moving on to other things. And at least what I don't think I heard is we're going to come in and sort of stop the whole business for a while. We do everything and then restart. Not a very practical approach, but someone said yes, could work my way there.

Josh Fonger (00:41:56) - Exactly. Yeah. You start where you are and you make it better. You can't stop the train. It's already going.

Tom (00:42:03) - That's excellent. Well, Josh, thank you very much. Like I said at the beginning, I hope that people will think of this for their own business.

Tom (00:42:09) - We've got accountants who are very forward looking, but at the same time they need help. And as they work with their clients and they've got clients who they probably look at and say, Wow, every time I meet with this person, what they tell me is working too hard. Thought I could make more, whatever that looks like that. They've got a tool that they could recommend to people that could help them in their clients.

Josh Fonger (00:42:27) - Yeah, sure. Definitely recommend that. And just tell them to tell them to read the book and that's great.

Tom (00:42:34) - Good. Well, thank you very much for your time today. All right.

Josh Fonger (00:42:36) - Thanks, Tom. 

intro (00:42:37) - Enjoy this podcast. Visit our website, Summit CPA Net to get more tips and strategy for achieving modern CPA firm success. We are here to be a resource in this ever changing industry.