People and Profit – Getting the Balance Right

November 13th 2020 | Posted by Dave Cross

People and Profit – Getting the Balance Right

People and Profit - Getting the Balance Right

We are living at a time when many businesses are struggling to survive given the financial pressures created by the pandemic. This applies as much to accountancy firms as it does in other industries.

The additional pressure that falls on the accountancy profession is the requirement to provide meaningful advice to clients, to help them deal with the current situation.

Balancing profits and the needs of employees is one area where this advice can be extremely useful. It’s also an area that accountancy firms need to pay close attention to internally. Yes, securing as much profit as possible is important right now but there are important reasons why this should not be at the expense of disregarding the ongoing well-being and motivation of employees.

The effect of putting profit before people

It’s easy to get carried away with concentrating solely on the financial situation of a business, especially when the financial climate is as difficult as it is right now. For example, accountancy firms may be looking to secure as many clients as possible in order to keep their head above water. However, there are dangers to forgetting about the effect of this on the people working in the firm. Long hours and limited recognition can soon start to take their toll. This can result in effects such as:

  • Experienced accounting professionals leaving the firm.
  • Mistakes being made due to the effects of long work hours on concentration.
  • Reduced productivity due to burn out and/or lack of motivation.
  • Increased sickness absence levels.

All of these issues can have an adverse effect on the profits of a business. Accountancy firms that recognise this can protect their own business and give valuable advice to their clients about the benefits of prioritising people.

Why prioritising people works

While prioritising people cannot be done at the expense of profits, it should be given the same level of priority as making money. There are several reasons why this is the case. For example, employees who feel valued are more likely to work towards securing a positive future for the business. They are also more likely to be highly motivated which in turn makes them more productive. In the case of accountancy firms this may mean that accounting professionals are willing to work longer hours because they understand the long term goals of the firm and how they are integral to them.

There are several measures that an accountancy firm can take to ensure that they prioritise people as much as profits. They can also communicate these measures to clients in order to assist them in securing their futures. These measures include:

  • Communicating openly about the business and its current position.
  • Providing health and well-being support.
  • Ensuring that employees have the training and support that they need.
  • Making sure that everyone is included in team discussions, including any remote workers.
  • Promoting a supportive and understanding environment within the business and encouraging employees to seek help with issues.

Implementing these measures helps accountancy firms to get the balance right between people and profit. Accounting professionals can also provide valuable advice to clients about the measures, to make sure that they also strike the right balance.

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