As a firm owner, managing the traffic flow is one of the biggest challenges you face. This means ensuring that communication and production traffic moves smoothly and without interruption.
In order to do this, you need to understand the concepts of communication and production traffic, and how they impact your business. We’ll discuss these concepts in detail, along with some tips on how to improve the traffic flow in your accounting practice.
How Practice Owners Struggle in Managing Traffic Flow
Many accounting and bookkeeping practice owners find that managing traffic flow is the most challenging aspect of their business. Not only must they divide resources and time among clients, but they also have to manage administrative tasks and business development.
Furthermore, increased customer demand in certain areas can exacerbate issues with overbooking or lack of staff. To maximize efficiency, accounting and bookkeeping practice owners need to prioritize their efforts by focusing on their core competencies, leveraging technology, and adapting a deep and narrow team structure when possible to streamline processes.
By understanding the complexities of traffic flow management in your practice, you can create an efficient system that ensures smooth operations and satisfies clients.
The Correlation Between Pain and Growth
When it comes to managing traffic flow, the pressures of a busy practice can create both pain points and opportunities for growth.
Pain points can arise from overscheduling or understaffing, while opportunities present themselves as potential areas of expansion in which you can invest. It’s important to strike a balance between these two extremes: too much pain and you risk burnout; too little and there is no impetus for growth.
The best way to manage traffic flow in your accounting practice is to anticipate problems and act proactively.
Communication Traffic VS Production Traffic
Successful businesses must master the efficient management of both communication and production traffic. In this sense, communication can be seen as the ‘air traffic controller’ while production is the actual plane that utilizes these directions to reach its destination.
Managing communication entails navigation of incoming external input – emails, meetings, phone calls, etc – as well as managing internal input such as people queries and discussions around business strategy.
On the other hand, production traffic refers to activities related directly to doing the work -such as admin doing admin work, Accountants doing accounting work, bookkeepers doing bookkeeping, and partners doing strategy work.
It is key to manage both in order to ensure that the right people are doing the right tasks with the appropriate level of cost applied—this helps ensure efficiency when operating the business.
The Wize Traffic Quadrant
The Wize Traffic Quadrant is a useful model for allocating communication and production traffic in your practice. The Senior Client Manager is responsible for high-level traffic such as strategic queries, which involve decisions about investments and larger-scale solutions.
For example, how can you buy a business with a sale value of $3M, or how can you structure ownership if investing in property? Meanwhile, the Assistant Client Manager handles all lower-level communication, such as tax return obligations and when capital gains tax should be paid.
At the top end, there is the High-Level Production Traffic, which requires oversight and management by the Senior Production Manager – they must review and check work before it is approved, as well as train staff in order to ensure procedures are completed correctly.
Examples of this type of task include issuing franked and unfranked dividends across different dividend classes, as well as finalizing a small business CGT concession using the retirement exemption.
The Senior Production Manager should also develop checklists for the team to refer to in order to adhere to standards of accuracy. On the other end of the quadrant lies Low-Level Production Traffic.
This type of production traffic is typically handled by Accountants or Bookkeepers who are trained in banking reconciliations, allocating transactions, completing payrolls, and taking financials to trial balance, P&L & Balance Sheet.
For practice owners looking for an effective method of managing their production traffic, utilizing The Wize Traffic Quadrant is a wise choice.
How to Implement a Smooth Flow of Traffic
To ensure a smooth flow of traffic in your practice, it is essential to have clear and consistent communication between the Senior Client Manager, Assistant Client Manager, and the Senior Production Manager.
It is also important to document all processes, procedures, and tasks so that everyone is on the same page. This will save time and money by avoiding errors or duplication of work.
Overall, effectively managing the traffic flow at your practice requires the implementation of clear processes and communication systems that enable both communication and production traffic to flow smoothly.
This can be achieved with the aid of The Wize Traffic Quadrant and by documenting processes, procedures, and tasks. With these strategies in place, you can ensure that your practice operates at maximum efficiency.