Creating Client Value and Improving the Client Experience: An Interview with Lisa Leighton, Managing Partner at BHP
Lisa Leighton is Managing Partner at BHP, one of the top 250 firms and one of the largest independent firms of chartered accountants in the north.
She believes that the term ‘advisory services’ has been bandied about throughout the 25 years that she has been in the profession, and so when the majority of firms (57%) said that their biggest strategic challenge in the next three to five years was ‘developing new products and new ways of delivering accountancy services’, she was not particularly surprised.
However, BHP has started to differentiate between simple advisory services and complex advisory services. The latter, she says, has been provided by BHP and other big firms and these encompass services such as tax planning and corporate finance disposals. It is the former – simple advisory services – that she believes organisations are struggling with at the moment.
“This is about having really good general business conversations with clients, and that’s what we’re trying to get to at BHP,” Ms Leighton says.
Ms Leighton believes that firms struggle with this because as an industry it has trained number crunchers rather than people who are comfortable engaging with clients on a regular basis
This is a journey that BHP embarked on before COVID-19, and a big part of this journey has been the ability to capture data quickly to help deliver advisory services – which was cited as the second biggest strategic opportunity facing firms in the next three to five years (57%).
“The likes of Xero, QuickBooks and cloud accounting systems have really helped with that, particularly with the apps you can plug into there to extract the data quickly,” she says.
A basic example of using this data effectively is in casting an eye on a company’s working capital using such tools.
“It’s really easy to pick up the phone and say ‘why have you not rung that customer to try and collect that debt, do you know it’s considerably over your credit terms,” she says, emphasising that this doesn’t amount to huge transformational advisory services, but that it is something that smaller clients don’t necessarily focus on
Ms Leighton didn’t agree that automating processes and workflows (62%) was the biggest strategic opportunity, as she feels that this is something that is already carried out at BHP – with electronic filing of accounts at Companies House and electronic signatures being some of the things that the company has put in place.
COVID-19 has made an impact on strategic direction
Every year, the 38 partners at BHP look at what the strategic vision is and consider what types of involvements the company should have in conferences and other engagements.
“We keep one eye on the future – we’re not a firm that wants to go backwards,” she says.
Underneath that, the company has an operations board that includes a head of HR, IT and FD, which Ms Leighton says is essential to help the organisation run as it does.
Ms Leighton says she picked the ‘reasonably effective’ option when asked about her effectiveness at making 3-to-5 year decisions.
“I think throughout the COVID-19 process has proved that by collaborating and working together as a team, we’ve actually moved mountains and I’d say this business in a far better place now than we went into it, and you look back and think ‘why didn’t we do some of this stuff before’,” she says.
She believes that the firm was less effective prior to the pandemic, and may have even picked option C – not very effective – if asked before the crisis.
Compliance and advisory revenue – a reversal or an added stream?
Firms clearly see the future in advisory and consultancy services and away from compliance. Ms Leighton suggests that it depends on what compliance services will be considered as compliance in the future – but that compliance won’t go away, it will just be different.
“Making Tax Digital will mean that in the next three to five years we’re likely to be reporting quarterly to HMRC, which is still compliance but I think compliance will diminish,” she says.
“I think compliance will be put under pressure because it’s far easier to do a year-end set of accounts, because if you’re engaging more with a client quarterly then the year-end drops off the end,” she adds.
However, she believes that businesses will still be happy to spend a similar amount on accountancy but it will be divided differently to how it has been in the past – with some on compliance and other amounts on advisory services – and BHP has seen signs of this in the last 18 months.
“They’re happy to pay for regular engagement, and it’s not just simply around talking about the numbers,” she states.
The aim ultimately is to get existing clients to spend more with BHP.
“You’re effectively competing with a client recruiting a financial controller and we can deliver this cheaper than employing somebody. We want to grow this side of the business, and we’re looking for clients that want to engage with us and listen to our advice – this comes with a higher price tag and people are prepared to pay it. COVID-19 has helped with that as well,” she says.