June 24, 2021
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Big 4 poaching
I started my career at a small accounting firm. It was a satisfactory experience. The pay was adequate, but the benefits were mediocre. I had solid colleagues, and the partners were fine. Not a ton of guidance or training, but I enjoyed the work, seemed to have an aptitude for tax, especially, and learned a lot in a couple of years.
Most of my college friends, meanwhile, had been hired into large firms—Big 4 and Grant Thornton—and I was fascinated by their experiences. They boasted of suffering long hours on prominent clients; their firms flew them off to elaborate week-long trainings in fun cities with other young auditors or tax pros. There was frequent travel and even talk of international assignments. Their stories, embellished or not, covering up actual suffering or not, gave me severe FOMO.
So when I received a cold email from one of KPMG’s in-house recruiters, I didn’t hesitate to reply. I interviewed with a couple managers and a partner. They all had nice, but cluttered offices, and they talked about their challenging and interesting clients. I was thrilled when I got the offer and quickly gave notice at my small firm for a shot with a Big 4. Looking back, it’s clear to me that it wasn’t so much about money and prestigious clients as it was about intense curiosity. I had to find out for myself what working at one of these firms was like. (And yes, I found out, but that’s a story for another time.)
Whatever it is about Big 4 firms that appeals to accounting professionals (and an increasing number of non-accounting professionals), their recruiters use it to their advantage to entice potential candidates… and then they strike.
Plus, the PR juggernautery also helps:
PricewaterhouseCoopers LLP is investing $12 billion across its global business in an overhaul targeting better audits, digitization of services and greener operations.
The professional-services provider will hire 100,000 employees and develop the skills of existing staff over the next five years as it seeks to respond to the post-pandemic operating environment, it said in an emailed statement on Tuesday.
The good news is not all of those 100,000 new people will be in the US. The bad news is that many, many small firms in the US will lose lots of talented people to PwC. It’s inevitable. And I’m sure a few people will go on to long, successful careers at PwC, but most will be chewed up and spat out. That’s also inevitable. It stands to reason that the rest of the Big 4 have similar plans.
We’ve talked a couple times recently about accounting firms helping clients deal with the tight labor market. That still seems like a good way to go, but many firms may have to follow some of their own advice and figure out how to deal with it themselves.
If I owned or was a partner in a small firm today, knowing what I know, I’m not sure how I would prepare for competitive poaching, if at all. The only thing that comes to mind is that my firm would need to be about something, and it would be crystal clear what that something is, and that something would be FOMO-proof. All which is to say: running a firm is already hard. And it’s likely going to be harder than usual for a while.
Trustiness as a service
For some time, the accounting profession has self-identified as the “trusted advisors” to businesses. They’re the professionals that entrepreneurs and owners go to with all the questions, count on for advice, and call up when they need to be talked down. Of all the cliches swirling around the accounting world, this one may be the most true and the most trite all at once.
Many businesses do rely on accountants for their expertise and consult with them on virtually every issue that comes up… and that narrative has been milked for all its worth. It’s been overused to the point that it’s lost all meaning. Some accountants even avoid the phrase so as not to embody the cliche.
But just when you thought that trust couldn’t get any trustier, PwC has embarked on the final frontier of exploiting trust: charging its clients for it:
At a time when corporate leaders are increasingly expected to act as moral arbiters, the professional services giant PwC has spotted a business opportunity: teaching executives how to be more trustworthy.
Not only did PwC recognize this opportunity to teach people about trust, they had the swagger to say, “We should be the ones to teach them.” I am impressed. That kind of overconfidence is usually reserved for Bond villains and billionaire space racers. Now that I’ve written that sentence, I realize how redundant it is.
Anyway, here’s more:
As part of PwC’s overhaul, the firm will combine its accounting and tax services into a new division called, unsurprisingly, trust solutions.
PwC’s U.S. arm will also spend $300 million on new initiatives centered on the trust theme. The main one is the PwC Trust Leadership Institute, which will teach clients how to handle issues such as transparency, ethics, data security, corporate governance and politics and policy — without prescribing specific solutions.
There’s a lot going on here, and this newsletter is already getting long, so I’ll just point out that to propose an institute that will teach people how to handle things like transparency and ethics, governance, etc. “without prescribing specific solutions” is a nice touch to an already impressive display of branding gymnastics.
I think the overall lesson here is that the trust well is deeper than we thought. Yes, you all can claim the title of “trusted advisor” for the services you provide; but until you’re trusted (and paid!) to teach others about trust, you’re selling yourselves short.
Fresh from Gusto
- An overview of FSAs.
- Choosing between an FSA and HSA.
- Recruiting and hiring in a post-COVID world, an ebook with our partners at JazzHR.
- My colleague Will Lopez and I chatted with Twyla Verhelst, Head of the Accountant Channel at FreshBooks, about gender and diversity in accounting.
- Ethics: The 4 Most Common Rationalizations Used by Horrible People with Greg Kyte and me on June 30.
- How to Hire Virtual Accountants Into Your Firm with Jeff Phillips of Padgett Business Services on July 14.
Read with Gusto
- How CPA firms can win women back
- Let the John McAfeee conspiracies begin.
- Yo-Yo Ma did another pop up performance, this time in Acadia National Park.
- Disc golf celebrity.
- “You might get indigestion, but there is nothing stopping you under U.S. law from eating the Mona Lisa if you own it.”