Anthony Bell is CEO at Bell Partners. Anthony has taken a very different view of building a professional services business – focusing on building a high productivity single partner firm. And he’s clearly doing something right, with the business winning a bunch of awards including BRW’s most productive accounting firm every year since 2003.
In this interview we talk about:
- Leading for high productivity
- Why “good enough is old enough” at Bell Partners
- How Bell Partners is structured to have “a whole bunch of little CEOs running around”
- Why induction has to be indoctrination
- The importance of transparency in the performance review process
- How Anthony got over the fear of employee retention
As always, I’d love to hear your thoughts or comments on this interview.
Steve Pell: I’m here with Anthony Bell who is CEO of Bell Partners. Can you give us the elevator pitch on what you do here at Bell Partners?
Anthony Bell: We’re basically a multi-discipline firm. We don’t just do people’s taxes or accounting. We try and look forward and do their financial planning, take care of their insurance, legal work, anything else that’s involved with money. We take care of all that as a one-stop shop.
Steve: Fantastic, and how big is the firm now?
Anthony: There’s just over a hundred staff working in the group. We’re a corporate modelled accounting firm, so we have offices in Queensland, Norwest, Newcastle and our head office here at King Street Wharf.
Steve: It’s a reasonably fast growing business?
Anthony: We incorporated in October 1997 and we’ve had great growth since then. In the last two to three years our focus has been on sustain and maintain, rather than just pure growth. So we’ve tried to really focus on having an A-grade client base and making sure that we’re meeting their needs first… rather than continually chasing growth.
Steve: Has the way that you’ve led the organisation changed as you’ve gone from the growth phase to sustain-and-maintain phase?
Anthony: Absolutely. The one thing that we needed when we were a really small firm was productivity. We had no funding… it was purely just me. So we learned some lessons back then that we still employ today. Those were around productivity and efficiency. Even though the organisation is a lot bigger now we still employ those same tactics.
Steve: Are there key points of difference if someone is coming to work at Bell Partners as opposed to going to one of the big four?
Anthony: We like to recruit really young accountants and promote them all the way through. We take the guys coming straight out of university put them straight into our system.
If I look at the twenty-four, twenty-five different managers inside the firm, about twenty of those have come from people who started at a very low junior level and worked their way up.
The one thing I have said to a lot of the guys is that you don’t come to work for a brand, you come to work for yourself. It’s a partnership between Bell Partners and that staff member. And if they perform well, they operate well and they consistently outperform expectations, they are the ones we promote and we look to help, not just in remuneration, but in management skills and work/life balance.
We have great stories of people who are twenty-four, twenty-five years old and managing client relationships. If they are good enough, they’re old enough for me.
Steve: So you are pushing responsibility right down then?
Anthony: It’s finding that mid point between pushing responsibilities down and providing the training and teaching that staff need. It’s the responsibility of the organisation to try and provide the right platform for learning. And that also gets down to the ability to retain staff for the future.
I think it’s a fifty-fifty type relationship; We’ve got a lot of IP here and our job is to make sure that we get that into the hands of the brightest and smartest in the future
Steve: It’s very interesting that you acknowledge every staff member has their own agenda. I think that’s a great step forward from the way that a lot of firms look at the employment ‘contract’.
Anthony: You just have to. The accounting profession is going through such change.
Historically, firms of accountants recorded history they weren’t involved in making industry. The new client wants more than that, they want advice. They want someone to coach them or mentor them and show them the exact pathway to getting there in the fastest and most efficient manner without bearing too much risk.
That’s the new professional that we’re looking for and I think, the customer is looking for. So it is our job to make sure they are doing more than balancing a profit and loss statement and really forming a relationship with the client.
Steve: It sounds like you’ve taken a view there that you have to build that kind of accountant, you can’t just hire them?
Anthony: I would say that we do hire externally. We have just taken a couple of guys from the big four firms who wrote to us and asked if they could get into our model. But we generally like to hire and grow.
The big thing that is most important thing in my mind is customer service and managing that relationship. And those skills are usually learned in a culture over a period of time. You just can’t import them. We like to create them internally.
Steve: Tell me what that culture looks like?
Anthony: “Can-do” is the key to the culture here. It’s the key theme in 2014, and it was the same in 1997 when we started.
It’s also a culture that rewards achievement. I’ve always tried to create careers long term. We had a seniors quarterly get away in Brisbane recently… And looking round the room we had the eight most senior people in the business. And of those eight people they have all been here for at least ten years. The shortest time at Bell Partners was eleven years the longest was sixteen years.
That retention of IP means that we’re doing something right. The guys who are common employees are staying because they are getting opportunities, they are being rewarded properly and they also get the self-esteem of being involved in the management group. There’s that real drive and thrive to the company. To have held that sort of retention rate for the very senior people in the company is a good litmus test for why people do stay here.
Steve: Is that a culture that you’ve really driven, or has it evolved over time?
Anthony: I really wanted it to be like that. We recruit people that we hope will make their way through to management and strategic advisor.
It starts very early in the chain. We know that means we have to monitor the guys that we take in at that very early level. We try and coach them, and also identify whether or not the skill level that we require is being met.
So, we’re very hard on the front end of the recruitment process. We take on a new group of recruits every year and we try and work with those guys to build them through the firm.
Steve: I think there are a lot of firms that would say that they are recruiting people that are going to become executives. But there’s probably not a lot who show that they really believe that through their actions.
Anthony: The leadership model has to really build that into the new recruits. Right from when they are twenty-one or twenty-two years old and fresh out of university with a degree.
They have to get the usual commercial accountant training but they also have to get outside training. They need to get training on how businesses tick. They need training on how to identify opportunities. They need training on communications. That’s what we try to do at Bell Partners. We try and make sure that they are not just intelligent, but that they are a good business fit as well.
Steve: It sounds like a process of indoctrination into the Bell Partners way of doing things?
Anthony: Our firm has always talked about being different. Certainly from that point of view we are different at the front end of the recruiting process. Our induction goes for a long time where we recruit carefully.
But at the same time we are comfortable having a conversation if we have made a mistake. We have that conversation; “this firm isn’t the right place for you”. But we do take a heart to that conversation as well. We talk about where we can relocate them to an organisation that might be right for their skill set.
We want to be a performance organisation so we have to make sure that we constantly surround ourselves with people who are performance focused.
Steve: Again there’s a lot of organisations who say they hire for culture, but they neglect the fact that if you really want a strong culture you really need to fire for it as well. It sounds like you’ve got that balance right?
Anthony: Yes, we do. But we try and train and teach and rehabilitate. But we also know that this culture took a long time build. The responsibility is ours when we recruit. We need to make sure we ask the right questions. We want to give the candidate every opportunity. So those “collisions” are few and far between and our great staff stories are more common.
Steve: Tell me about your role in the culture, how do you see your responsibility?
Anthony: I am a working CEO, I’m still client facing for about eighty percent of my week. So my role here is to make the requirements clear and to break the business down into small parts.
We delegate responsibility to a lot of the managers and ask them to run a business within a business. For those managers with four or five staff, we say that they’re effectively their own corporation working with Bell Partners. You do your own HR, your own staff training, your own motivation.
I should say that when I say staff training I mean on the job training. We provide broader staff training maybe three times a month in extended training sessions. But we do say to each manager train staff whilst they’re on the job. Make sure that you throw them into the deep end and see where they fall.
Steve: So you have a bunch of little CEO’s running around?
Anthony: Fundamentally yes, that’s exactly right. We have business leaders who run a business unit and they get remunerated on the basis of how that goes. Their performance reviews aren’t based on the whole firm globally. They’re based on how they run their business unit within the firm. That means that their returns can be measured and valued on what they actually have control of not what they don’t.
Steve: Was that a hard transition for you to make? I am sure at some stage you had to go from being CEO of everything to letting decisions devolve down?
Anthony: When I was working for my Dad, in the early nineties, I can still recall there was another guy who started the same day I did. And two or three years later we were on the exact same salary. The culture of accounting firms back then in the nineties was, I was twenty-four years old, you’re a chartered accountant, you can go and look in the book and see exactly what your salary should be. The difference was that by that stage my productivity was twice what his was.
I was introducing new clients to the practice, I was working effectively and the model of reward didn’t recognise that. It was really straight down the line, this is what you age is, what your qualifications are and you can put a circle on what your earnings would be.
I wanted to change that. I wanted to say that we should actually not go down those standard lists. If a twenty-four year old is outperforming a twenty-nine year old who has five more years’ experience; we should still look to reward that person based on what they can do.
Our company has been built on stories of young people getting opportunity and picking it up with both hands and having a go. And it’s one of the great parts of being CEO, teaching them leadership and guiding them in how they can inspire and motivate their staff.
The important thing I come back to with this company is we’ve always prioritised the shareholders, or myself, last. We’ve always put the customer and client first, so they are priority 1A and the staff are 1B. And at a distant 1C is our return to equity holders. But I find that if you get 1A and 1B right you don’t have to worry about anything else.
Steve: Let’s talk about productivity. You won a bunch of awards for productivity, is it eleven in a row?
Anthony: Yes, it started in 2003; I think BRW have now closed the category down,
Steve: They decided there’s no competition?
Anthony: We were forced to be productive from the start. When I started I couldn’t get any funding, I couldn’t get facilities from banks. We were forced to be really efficient and really productive.
And those lessons just stayed with us all the way through. We were really productive when we had two staff and three staff. And as we got our model right, and our structure right we kept that same productivity with ten. And that’s the core of our value proposition today. We aren’t an expensive firm on a fee basis, but we’re prepared to work to deliver a fantastic product.
Steve: Tell me what that means for someone who’s not in accounting. What does it mean to be a high productivity accounting firm?
Anthony: Ultimately as accountants we were taught to sell time. But the thing that got me was accountants used to be rewarded for being slow.
So we stepped back and started estimating the value of the job not the value of the six-minute units that went into it. We worked against a job budget to create a beautiful outcome for the customer and a perfect product that we deliver. But we also had to do it on a time frame.
We knew that if we went past that time frame that we weren’t actually getting paid more for what we were doing. And our work ethic was the other way around, it was always to do more than you got paid for. So the clients were happy because we would estimate the amount, and the risk of running the job was on us. That made us hungry and made us effective. But it also made us very productivity conscious.
Steve: So you are faster than your competitors?
Anthony: I would also say that I put quality ahead of schedule all the time. The risk is the guy is working too fast to hit a target and therefore quality misses. So we invented our own in-house quality and technical assurance department. They’re a non-client facing group that has no relationship to anyone and they report to me, so at the end of every work assignment they give an independent review, almost like an internal affairs department.
Steve: Auditing the auditors?
Anthony: They are sort of doing that. Work cannot get out of our doors until it has been signed off by the technical and quality assurance department. That’s the ultimate test. You want quality but you also want productivity. But if you can only have one, have quality.
Steve: So once you get to that point of the quality, then it is really about making a firm that works quite fast to get that high quality out?
Anthony: I think so. We want to make sure that our engine is always working. I’ve said before: “if you you can’t measure it, you can’t manage it”. So our measurement system goes right down to the individual group. It is the heartbeat and pulse of our office. My management dashboards go to down to the individual businesses on a weekly basis to see how they are performing. I know when they are going really well and I know when they need a little help.
Steve: So really data transparency is what is driving your ability to get to that level of productivity?
Anthony: I do think that there’s got to be measurement. It’s no different to a sprinter running a hundred meter race. He might feel he is running fast but ultimately what matters is what the clock says. We’re the same. We might have guys feel their efficiency and working to a quality result, but we have the measurement system that truly reflects the productivity at any point in time.
Steve: I imagine this all ties back on the other side to having real transparency around performance reviews?
Anthony: Absolutely and that is the most important thing. The one thing that has always worked for us on bonus structure is simplicity. We’ve had many, many different models over the seventeen years. But the one that really works for us is a very simple one.
It’s articulated well at the front end, with a common understanding of expectations. Then I have the employees submit what they think their performance review is going to be based on that common set of principles. Because they’re simple the opportunity for misinterpretation is a lot less. So for me, that is a perfect working relationship. Fundamentally here for our seniors, their remuneration is decided by them, not by me.
Steve: Can you give me an example of how simple that structure is?
Anthony: Each firm is different. But I come back to the simple metrics and talk about their team management. It’s about the human resource side of it and the outcome that’s been achieved on that. So I minimise a whole lot of complexity, I don’t try to put a piece of the firm’s PI insurance or a piece of the firm’s software, or a piece of the firms rent onto each individual. I get it down to really simple metrics.
Steve: So, if you were going to define really briefly what a good manager looks like at Bell Partners what would that sound like?
Anthony: Basically highly experienced and highly qualified. Regardless of any other skill they had, we are fundamentally in the business of getting it right so those things are absolutely essential. The next thing I look for is an intriguing mind, somebody who looks past just what is in front of them. They can make good diagnosis of issues that might improve our client’s wellbeing in business. And the third thing I am looking for is people who are solid in the skill of prognosis. They have diagnosed the issues and now they are adding value by consulting and delivering outcomes.
That is the right person for us. I am a big believer that those people can be made, that those people can be taught. I think that the days of saying that somebody is a born leader are behind us.
We really like getting our young guys involved in some of the senior work here so they can see how the firm works. It’s a bit like with car mechanics, the best ones always want to work on the European cars. We want to say that part of our on the job training is making our guys work on those jobs so they can see what makes a great company. We try to teach our guys what helped make our clients great from the numbers.
Steve: What’s next for Bell Partners?
Anthony: We are headed towards a national platform. There is a space out there for a boutique national firm. But we are more interested in the currency of client management and making sure our clients don’t feel at any time that Bell Partners is growing but my quality of advice and my access to my seniors is not. We have tried to define that boutique service model and not grow hand over fist. We have never made an acquisition.
None of our growth today has been by buying growth. I have an issue with that because I tend to feel that those that are buying growth haven’t learned what it takes to attract a client in the first place. And that’s going to be a problem for the future.
Books of accountants are for sale all the time. You can go out and buy them. I get three emails a week saying “Will you buy me out?”. That is an easy transaction, but to me the issue is that you don’t know what you are taking on. And again you still want to keep attracting work to yourself. So if you have to buy clients, you probably didn’t learn how to attract clients.
Steve: It does sounds like you have a real potential acquisition platform sitting there for some stage in the future?
Anthony: There is always going to be a next page for the firm. I have been approached by some very respected and excellent organisations, and it is very humbling. They have looked into acquiring our business and our model. I am never going to shut the door to that but right now I enjoy the work.
I still work fifty to sixty hours a week. I was told many years ago “show me a great company and I will show you a leader who treats his work as his leisure”. It has its moments, but I do generally enjoy my work.
We have taken so much time to build a good culture and a good group of people. I guess our test is against ourselves, as to making sure we are servicing our clients and making sure that we do more than we get paid for.
But at the same time we want to be delivering bolt-on innovating for our clients needs in the future. Five years ago you never would have thought that we’d have in-house corporate finance, in-house insurance, in-house legal.
Steve: Fantastic, to wrap up, go back to day one, what do you wish you knew then that you know now?
Anthony: Excellent question, I don’t get asked that one as much as I used to when were a bit younger!
I think the most important thing that I wish I had known back then would be that if I looked after my people they would stay with the business. Retention was always a real fear for me. I used to fear it and worry about it. I always knew that most other firms would have to give partnerships out to retain their key staff.
I had a model in my head that said if I treat my people really well and remunerate them well then they don’t need to have equity in the firm. This one leader, one direction idea was important to me. But that model gave me this retention risk. So if I had known that this idea would work I guess I would have spent a lot less sleepless nights worrying about whether the great people would stay with us.
Steve: Thanks so much Anthony, appreciate your time
Anthony: No worries, thank-you.
– Slight edits have been made to this transcript for the sake of readability –
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