In 2017 I presented a session for the leaders of the firms in an association of firms in Australia. It was on lessons from 30 years in the profession and one of those lessons was “you can do more with less than you think (process and people)”. One of the key messages I shared came from a Dutch accountant called Stefan Vermeulen at D&V Accountants based in Manila. Here is the slide that summarised his message.
Stefan’s mantra was pretty simple. When looking at processes first decide if there are steps that can be eliminated. Once you’ve done that, simplify what is left. Then standardise what you have simplified. Then automate as many of those standardised steps as you can and if you can’t, consider offshoring the work to the Philippines.
Fast forward to 2024 and you might have read about Elon Musk’s “the algorithm”. As I share more about it you might notice some striking similarities with Stefan’s ESSAP mantra! The components of Musk’s algorithm are:
- Question every requirement
- Delete any part or process you can
- Simplify and optimise
- Accelerate cycle time
- Automate
Accounting firms have a large number of repetitive processes so it’s not hard to see why Musk’s algorithm (or Stefan’s mantra) could be usefully applied.
- Question Every Requirement
Identify the individual behind each requirement and critically assess its necessity, regardless of the source’s expertise. Musk emphasizes that unchallenged requirements from intelligent individuals can be particularly detrimental. That will be you partners/directors!
- Delete Any Part or Process You Can
Eliminate components or steps that aren’t essential. Musk suggests removing more than seems comfortable, noting that if at least 10% aren’t reinstated later, insufficient deletion has occurred.
- Simplify and Optimize
After removing unnecessary elements, streamline and enhance the remaining parts. Musk warns against optimizing components that shouldn’t exist, advocating for simplification only after thorough elimination.
- Accelerate Cycle Time
Increase the speed of processes, but only after completing the first three steps. Musk acknowledges past mistakes of hastening processes that later proved unnecessary, highlighting the importance of prior elimination and simplification. See my article on what accountants can learn from Appliances Online for a great example of how this could be applied in an accounting firm. Ideas for accountants from Appliances Online – Planet Consulting
- Automate
Implement automation after refining and accelerating processes. Musk reflects on errors where premature automation led to inefficiencies, underscoring the need to address earlier steps before automating.
I’m regularly disappointed by what I see as underinvestment in improving processes in firms. Take some ideas from Elon Muck (or Stefan Vermeulen) and apply them in your firm now. With so many repetitive processes inside firms the results should be super positive.
If you’ve been doing this already, let me know what sort of results you’ve achieved. If you haven’t get stuck into it!