Jeff Wilson II felt his firm was a ship without a compass. He could tell his firm was growing by revenue and headcount but wasn’t sure where they were compared to similar-sized firms in his region.
“It’s easy for you to measure your performance up against yourself … but that really doesn’t tell you if you’re behind or if you’re in the middle of the pack,” said Wilson, CPA/PFS, CGMA, CFE, CDFA, and principal at The W2 Group LLC, based in Maryland.
Wilson learned about the biennial National Management of an Accounting Practice (MAP) survey from the AICPA Private Companies Practice Section (PCPS) and completed his first survey a few years ago. Reviewing the survey results provided Wilson a reliable benchmark for how his firm fared compared to other firms of the same size in the southern region. The MAP survey is now a resource he routinely reviews and cites.
Participation in the MAP survey provides firm leaders a data-driven tool for managing their firms. The MAP survey is a detailed snapshot of the financial results and practice management approaches of today’s firms and is completed by managers and partners. The results offer a comparative look at where their firm’s performance stands against other firms of the same size and region and can help identify emerging trends.
“The MAP survey gives you direction,” said Wilson. “This is the tool you need to manage your firm. The MAP survey helps you say, ‘I’m trying to get here and here’s what that means statistically.’”
Largest survey on CPA firm practice management
While there are other surveys that poll and measure the current state of the accounting and finance profession, the MAP survey is the largest benchmarking survey that aggregates data on practice management techniques. The 2021 iteration of the survey garnered 1,065 responses from U.S. firms ranging in size from less than $200,000 in net client fees to those that collect $10 million or more.
Questions encourage in-depth answers, and managers and firm partners share data on billing rates, realization percentages, employee salaries, turnover and retention trends, technology investments and more.
The results report provides context for the issues facing firms of differing sizes across the country. The section “Preparing your firm for the future” expands upon the results and details how firms can apply the presented information.
“The issues facing my 1,200-person firm are very different in form and function than a 12-person firm,” said Erin Roche, CPA, CGMA, partner at BPM LLP and based in California. “But with the MAP survey and your ability to filter down not just by region, but by firm size … you can really drill down to make sure the metrics you’re looking at are relevant to the question you’re looking to solve for yourself.”
MAP survey participants will receive free personalized reports comparing them to other firms in the region and of similar size. In addition, PCPS members will receive customizable reports to perform their own peer-to-peer comparisons. National results of the survey are available to PCPS members and available for purchase by anyone.
The survey results paint a clearer, broader picture of successes and challenges facing firms.
“Where are our major successes and pain points in the moment?” questioned Roche. “We strategically go back to the MAP survey and if it’s a pain point, where are other folks? Is it something we’re doing better than we realize, or are there trends on how a firm is handling a particular pain point?”
Integrating MAP survey results
Realization percentages, chargeability, profitability markers and other select key performance indicators (KPIs) are a few of the metrics Kim Russo, partner and chief operating officer at Missouri-based Swink Coplen & Company, P.C., finds most helpful.
“For realization and profitability, we always try to stay within the standards of what other firms are doing,” said Russo. “Incorporating those into our business, those are our benchmarks. We’ll set them in our annual goal setting. These are the percentages we want to hit in these areas, by department, by type of work.”
Wilson studies the MAP survey results closely to find emerging trends. “We got a really good understanding of what the firm-of-the-current is so we can figure out what the firm-of-the-future is.”
Not only can firms see emerging trends on which to focus strategic priorities but analyzing the survey results enables firms to be trendsetters to gain competitive edge.
When reviewing the 2021 results, Wilson learned that nearly 80% of firms earned most of their revenue from tax services. His firm specializes in client advisory services (CAS), and Wilson was concerned that he might need to ramp up tax services to be more competitive. A deeper dive into the MAP results revealed that tax-centric firms were trying to offer more CAS, proving his firm was ahead of an emerging trend — and right where they needed to be.
“MAP helped me realize what we were and what we weren’t,” said Wilson. “And it helps me understand what’s the market and what small firms are doing. It helps me set my goals.”
Thanks to the MAP results, Wilson learned his firm was underbilling compared to similarly sized firms in the region, and they raised prices accordingly.
“You can find the leaky holes in your firm and plug those leaks,” said Wilson.
Survey tips from the pros
For the 2023 survey, gather all financial and nonfinancial data from 2022 including net sales, billing rates, staffing numbers, types of pricing, breakdown of revenue by service and more. To be successful in taking the survey, Russo, Roche and Wilson all recommend gathering these records ahead of time.
Once results are released, there is a plethora of data to review. Instead of trying to focus on all applicable data points, Roche recommends identifying three to five areas where comparison information would be helpful.
“There are so many different ways you could go with MAP survey results,” said Roche. “I could see where it could be super overwhelming if you try and take the entirety of the information and apply it immediately.”
Wilson recommends much the same: Identify up to five “key statistics that your firm wants to target and then set those as your organization’s KPIs for the year.” With metrics set, Wilson said, you can easily track your firm’s growth comparatively.
Embrace data-led decision-making
While a firm may want to tackle all their obstacles at once, the results allow executives to focus and prioritize operational goals and business objectives. If firm partners and leaders want guidance on creating solutions, bring them the data, suggested Russo, and explain to them why integrating certain changes track with the current trajectory of the profession.
“Results of the MAP survey are a great way to validate arguments for change,” said Russo.
Participation in the MAP survey gives firm partners and leaders a sharp tool for how they manage staff and business operations of their firms, and the 2023 MAP survey opens on May 1.
Additionally, survey takers are encouraged to suggest key metrics to be added in future surveys. The survey closes on June 30. Seek direction for your firm and learn more about the MAP survey.