I thought I might shift gears a bit this week and blog a little about relationships with outsourced service providers (since we tend to fill that role for our clients and CPA partners, I would like to think we have a reasonable perspective) rather than tax technical topics. Since much of our work comes through CPA firms and the relationships we have developed with partners and senior managers at various firms, understanding what is important to them is critical to cultivating a long-term partnership (the goal of all service providers).
A Question of Trust
From a CPA firm perspective, one of the most difficult things to implement is a relationship with a firm that handles a specific expertise for your clients and to get comfortable that they are working with your best interests and your client’s best interests in mind. It comes down to trust.
Are they going to bring the expertise to the table that we expect?
Will they treat our clients as their own?
Will the keep us informed throughout the process?
What happens if their work is audited? Will they be able to defend it successfully?
Today, we will look at 3 Keys to successfully managing outsourced relationships that will hopefully provide a foundation for evaluating and growing future relationships for your firm.
Vendor versus Partner – Setting Expectations
Perceptions are often reality and while all companies have vendors for various services, the larger, more complicated or client-centric services require a different approach. Does the relationship act and feel like a partnership working toward a common goal? Communications are many times part of the solution and understanding the expectations from both are critical.
Coaching and Conflict Resolution
Firms with strong alliance or partner management implement both a business leader to manage and oversee the relationship as well as personnel assigned to mentor, monitor and coach. These individuals can be critical when conflicts arrive to help work through tactical level issues and resolve them quickly.
Perhaps central to the outsourcing relationship is understanding how success will be measured. While setting expectations Is an important part of the process, knowing how “success” will be measured should be both discussed and documented early in the relationship and revisited periodically to assess and adjust as necessary.
Many times, we are asked to meet with a client of a CPA firm to evaluate their R&D tax credit or IC DISC potential. Depending on the CPA firm that referred the client, we may have a standardized reporting structure that we provide on current engagements, on-going business development and quality of work. Other firms are comfortable handing off the client without much structure. In one case, we feel (and I hope they feel as well) that the relationship is partner-oriented; in the other, more vendor-oriented.
You can probably think through your outsourced provider relationships and categorize them as either partner relationship or vendor based on a simple metric such as communication and metrics or lack thereof.
Below, we have a link to a short survey that asks for information about how you perceive your outsourced provider relationships. I hope that you will take a few moments to take the survey. We will post results after we gather information from enough people to make it worthwhile. Also, your comments are welcome in the comments section below so feel free to add your thoughts.
Randy Eickhoff, CPA is President of Acena Consulting. With more than 20 years of tax and consulting experience, Randy focused on helping companies successfully document and secure tax incentives throughout the US. He has been a long-time speaker nationally as well as conducted numerous training sessions on R&D tax credits and other US tax incentives.