Build Workflows People Actually Follow: Lera Kooper on Adoption

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Luke Frye (00:00) All right. Welcome back to our fifth and final installment of the Canopy Practice Success Podcast. I’m Luke Frye, CPA and the Accountant in Residence here at Canopy. And with me I have Lera Kooper, who I will have introduce herself one more time.

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Lera Kooper (00:18) Thank you. Lera Kooper, an owner of Accountability Services, currently the COO. We have a presence across the country and are growing pretty aggressively through M&A. So excited to be here for the last time.

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Luke Frye (00:36) All right. Well, this time we’re going to talk more about workflow optimization and building a process. A lot of what we’ve discussed so far is really interrelated, but we’ll go a bit deeper on workflow design, how that’s half the problem, and adoption. How you had to figure out how to build processes that your team actually uses, which is way easier said than done. And not because they’re required to, but because it’s generally better.

So we’ll again start with some questions and we’ll go into some predictions. How’s that sound?

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Lera Kooper (01:05) Okay, perfect.

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Luke Frye (01:08) Okay, so how do you approach building a new workflow? Where do you start?

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Lera Kooper (01:14) It’s a very whiteboard-esque process. Maybe mentally, maybe on that big sticky note of mine. But just trying to line up what happens when, whose hands does it pass through, and then assigning, this should happen within one day, this should happen within two days. Very relative dates, unless it’s agency deadlines of course. Those are hard dates.

So it really starts with a very whiteboard experience. And then we start to frame up if there’s any holes or places to refine it. Because typically if you’re whiteboarding a process, it means it needs some refinements.

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Luke Frye (01:52) And what about bringing people in? How do you manage change in the organization when it may be someone’s workflow that you’re trying to optimize?

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Lera Kooper (02:05) I think a lot of the fear just comes from the unknown. So change management in general, a lot of the fear is in the unknown.

And so I think it would be very overwhelming if you said, we’re implementing Canopy, department heads, create your task templates for every single workflow. Because now not only do they have to design the workflow, they have to become a super user of Canopy and learn how to translate that workflow into this system.

What worked really well for us, and is always my recommendation, is when you’re implementing a project management software, any new process, any new system, have one champion that is kind of leading the charge on being the super user. They should be able to interpret the process into what it looks like on screen.

That way they can list out, here’s all the processes we need. We need 1040, 1120, we need monthly bookkeeping, sales tax returns, what have you. So they can project manage what needs a process, what needs to be in the workflow.

And then they can draft up an outline based on their knowledge and experience working with the firm. Here’s what happens when, here’s who it goes to. You know what, I end up putting out a lot of fires in this area, so we should make sure that’s a subtask assigned to somebody so it doesn’t fall through the cracks.

And then pitch that to the subject matter expert or that department lead to say, I think this is how your process flows. This is where it changes hands. These are the relative due dates we like to have in between to keep a tight loop on it. Am I missing anything? Is there anything you’d like added? Are there any friction points you’ve experienced in the past that we wouldn’t have if someone could be accountable to it, AKA a subtask with an assignee and a due date?

And then that super user is in charge of actually creating the template. There are so many automations that go into it, even making sure the status is updated, the next status updates when you complete a task or subtask. So they’re in charge of creating it and then pushing it out. Then the rest of the team can just be a user.

That’s the intent. It’s the users who are doing the billable work. I don’t need them to spend time becoming an expert at how to architect Canopy, or fill in the blank system. So I think that’s how we work through change management with workflow. Siloing who’s managing the change and who’s a user of the change.

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Luke Frye (05:00) I love that. What’s the difference between a workflow that works and one that just exists on paper? We said on paper, but in a Google Doc or a Word doc or somewhere in OneNote that people aren’t actually using. What’s the difference between that and a well-adopted one?

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Lera Kooper (05:22) A workflow that works gives you answers to the questions you’re asking about workflow. Where are we starting to bottleneck? How many do we have in this status? I should be able to see all those things at a glance. How many things are with client? What percentage of our clients’ next meetings are booked?

That’s a very client experience focused metric for me, because that’s a pretty good indicator of how engaged my clients are. And then that’s an indicator of retention.

And so those things, if scheduling a client’s next meeting is a client request, then I can very quickly filter for that subtask, filter for a with-client status versus completed, and get my percentage.

So a workflow that works is one that answers your questions clearly.

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Luke Frye (06:10) Sure. So I think the inverse of that is, how do you know if a workflow isn’t working, whether it’s the process itself or the people involved?

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Lera Kooper (06:22) That’s a good question. If a workflow is not working, even if it’s the people involved, it might be an indicator that there’s some friction point within the workflow itself.

Like, do we have three subtasks in a row that are assigned to the same person and they do all three things in one sitting? Consolidate it. Because what they might do is click one of them, be busy, not click complete on the next two, and then we get work that’s kind of stuck in position and not moving to the next person.

So those are some refinements we’ve made. Other refinements we’ve made as our team has grown, because it’s important that we have an audit trail and accountability and visibility and all these things, is with any tax return flow.

I’ve seen a lot of firms do a workflow where it’s like prep, review, 8879, file return. And I’m thinking, file return is send the 8879. It’s with client, so now ops can know, okay, with client 8879, that’s something we can nurture. Then it’s, okay, we have the 8879, we need to e-file it. Once it’s been e-filed, we have to wait for the IRS acceptance. And then once it’s accepted, I have to save a copy of that and make sure it’s in the client portal.

So really, e-filing is four steps.

And so one workflow that didn’t work in the past for us is where we didn’t have those four outlined very clearly. Things would get stuck in one of those spots, but we didn’t have a lot of visibility into which area it was stuck in. So either it sat for a while, or it was misleading for our numbers. That’s a refinement that we made. Making sure the process is truly representative of every step that needs to happen in order to complete the work.

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Luke Frye (08:20) Yeah. And it does seem like overkill if you have one person doing everything in a return.

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Lera Kooper (08:28) But we have multiple hands in the pot. You want to make sure accountability is very clear. And then you have that audit trail behind where things are.

And it allows for collaboration and support around deadline season, where someone can just pull up the 8879 list and say, let me make some phone calls.

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Luke Frye (08:48) Right. Okay, last question here. What’s the most impactful operational improvement you’ve made in the last two years?

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Lera Kooper (08:58) Well, not in the last two years. Getting into Canopy was one, but that was more than two years ago.

I think creating some operational governance around workflow management. Making sure there are just a few super users who are actually creating the tasks, so then there are no bugs within the tasks themselves. Those people are also the ones managing production.

And that’s one change we’ve made in the last year that’s been massive. Taking production management out of the technical tax team’s hands and into operations. So then it’s not the tax seniors’ responsibility to review where are we bottlenecking, how much do we have assigned to who. It’s operations. They come into the tax huddle meetings saying, this is what we have in each stage. You look a little heavy, you look a little light. Are there any names that you’re familiar with that we cross over?

So it takes a lot of that off the technical team’s plate, so they can focus more on their work and they don’t have to be a super user on slicing and dicing the data.

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Luke Frye (10:10) So it sounds like the operations person is almost like an air traffic controller.

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Lera Kooper (10:18) Very much so. They’re making sure the planes are in the right place and the pilots are in the right seat.

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Luke Frye (10:26) Exactly. I love it.

All right, we’re on to predictions. What does a genuinely modern accounting firm look like as a business?

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[Recording break — trim in edit. Brief exchange about whether to skip the question, then the answer resumes below.]

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Lera Kooper (10:48) I think a lot of the transactional work is going to go away. As we trust technology and as it develops, that part of the job will go away. I’ve alluded to that earlier, saying we’ll be much more relationship focused, but that’s what that requires.

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Luke Frye (11:00) Right. So a lot of the things that we were taught how to do, that we’ve grown accustomed to doing, that feel good to click off the button but actually aren’t adding value to the client or the relationship, will likely be automated.

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Lera Kooper (11:14) Yeah. Those people will be in a reviewer role.

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Luke Frye (11:18) Right. Someone still has to do that and have the human relationship, but I think it’ll push a lot of people out of their comfort zone.

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Lera Kooper (11:26) Do you have a different answer?

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Luke Frye (11:29) No, I agree with you. I think that’s in line with the way technology is moving.

Unfortunately though, you do still see a lot of people on QuickBooks Desktop, which they’re sunsetting. And then there are still tax firms who operate on paper. So these people still exist and these processes are still available. There’s a long tail.

Technology is accelerating faster and faster, so the tail will probably just get shorter. But there will also be a long tail of late adopters.

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Lera Kooper (11:58) Yeah, it does say a lot when these software companies themselves are saying, we’re done with that product, we’re sunsetting it. That’s definitely going to push some people along.

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Luke Frye (12:10) Right.

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Lera Kooper (12:12) Yeah, I think it’ll accelerate as time goes on.

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[Recording break — trim in edit. Discussion about reusing questions from the previous segment, plus an off-mic check that the recording is still running. Reframed question resumes below.]

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Luke Frye (12:40) Do you have any questions you want to answer on workflow optimization?

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Lera Kooper (12:46) I think the question I get a lot, especially if I meet with any firms looking at Canopy as an option, is just, where do you get started? With workflow optimization, where do you get started when you’re not this organized, or you have to redo your processes?

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Luke Frye (13:04) Right. Or maybe set processes.

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Lera Kooper (13:08) Set processes, yes.

So one of my recommendations is always have a champion behind this who is the super user, because there’s going to be someone that’s excited about this. They’re going to love this project. And then let everyone else be a user.

The next one is pick your pain points. What three areas or three deliverables or tasks in the business create the most complaints or friction with clients or a team member? You can only do so much at once anyway. So just start whiteboarding your processes. Pick the few that are the highest leverage to improve, or that create the most leverage if you improve them. And then whiteboard it out, create a task.

It feels like rocket science because it feels like there’s so much to do.

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Luke Frye (14:00) And can’t it be such a double-edged sword? You’re like, I can do anything. Oh my god, you can do anything. So where do I start? Where do I stop?

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Lera Kooper (14:12) And so I think just starting with one feature at a time can help limit the overwhelm. Just get really good at one thing. Get really good about creating tasks that have clarity and accountability. And then start bolting on other features, because the more you’re in the ecosystem, the more you benefit from its efficiencies.

But it can be overwhelming to do everything at once. So I would just focus on getting the data points right. And then you can start getting into insights, because you can’t get value out of insights if your data points aren’t consistent.

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Luke Frye (14:50) Exactly.

So you mentioned Canopy, but really any all-in-one practice management software is a huge product. It’s a huge undertaking. And we’ve seen a real uptake in what we might call point solutions, whether it’s for call recording, industry-specific call recording, payments, all these kinds of things. Companies like Canopy are really trying to focus on being an all-in-one solution.

What’s your prediction on point solutions versus a one-stop shop, and why would you say that?

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Lera Kooper (15:25) Good question. I think there are definitely efficiencies to having everything in one ecosystem. And for a lot of firms that haven’t used technology yet, literally anything is an improvement. So I would say just get into the thing that has the ecosystem, so you can experience all the efficiencies.

Personally, there have been some tools like Ignition that I continue using because Canopy hasn’t rolled out features that make it a lateral move for me quite yet. And there are so many efficiencies I’m looking forward to when I do bring it into Canopy. But until that point, I’m still using something that just offers that one feature.

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Luke Frye (16:20) And so then what sort of risks do you expose yourself to? What are the downsides of that? If another solution might be better for someone, at what point do you say, actually, I’ll move everything over?

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Lera Kooper (16:38) The efficiencies of having everything in one place, and in Canopy, Billing and Engagements, is that it can auto-create the tasks.

It is a massive lift every renewal year to have to input tasks. Even though we have manual tax templates and we can say, these 50 1040s signed, and we can add 50 1040s, it is still a massive lift when you’re talking about thousands of clients.

So that’s one thing I’m so relieved to have all in one place very soon, because that is so much capacity that’s now free for something else in operations. I think there’s a definite gain to be had from having your tools talk to each other.

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Luke Frye (17:30) Right. And then you’re mitigating risk and some SOC 2 compliance concerns by having things in fewer silos and all embedded.

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Lera Kooper (17:42) Yeah.

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[Minor seam — optional trim. “Do you want me to re-ask that?” Question resumes below.]

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Luke Frye (18:15) So there’s been a big push into private equity and mergers and acquisitions in general. But the reality is, even if you don’t have a plan for how your firm is going to end, your firm is going to end.

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Lera Kooper (18:30) Yeah, better or worse.

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Luke Frye (18:32) Better or worse. And it’s better to plan for it, just like any sort of ending.

So we’ve been talking a lot about AI and tooling and staffing. But specific to workflow optimization, what’s your prediction for a firm’s valuation if the workflows are really dialed in? And what about the person who maybe worked 40 years and is now ready to get out of the game, because they don’t really want to learn a new tool right now?

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Lera Kooper (19:00) Yeah, I think the more turnkey that a firm is, the higher the multiple, the higher the valuation. Because that’s less work the next owner needs to do to get the firm to a scalable or modern position.

That goes for workflows being clear or standardized, or deliverables. That goes for billing procedures. It goes for roles and expectations on your team members, because we see a lot of, they do some of this, some of that, some of the others. What are they accountable to? What am I relying on them for?

And so the less we have to go in and define, clarify, or correct, and correct might be the wrong word, adjust, the less we have to do that, the higher the premium.

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Luke Frye (19:45) So workflows and standardization, both with process and software, will increase the size of the square footage of your retirement home.

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Lera Kooper (19:56) Totally.

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Luke Frye (19:58) Yeah, or how many retirement homes you have.

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Lera Kooper (20:02) Yeah, islands.

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Luke Frye (20:05) Awesome.

Well, that’s the end of our five-part series with Lera. I would love to give her one more chance to give us any sort of hot take she might have on where the industry is going, and how AI and accounting is either helping or hindering the profession, before we wrap it up. No pressure.

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Lera Kooper (20:28) I would say just let yourself be surprised.

I don’t think technology is the enemy. AI is not the enemy. Those that leverage it will be better at their jobs, and those that are using it as a shortcut, I think, will have fewer hiding places as technology progresses. So I would leverage it.

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Luke Frye (20:52) I love it. Well, thank you so much, Lera. It’s been great to talk with you today.

If you missed any of the other four episodes in our five-part series, please check the channel that you’re on right now. I’m Luke Frye, CPA, Accountant in Residence here at Canopy. Stay tuned for more practice success from Canopy series with Lera here on Canopy’s Practice Success podcast. I’m Luke Frye, and we’ll talk to you again soon.