How to Motivate Your Accounting Team – and Benefit the Bottom Line
No one really appreciates the microwave, until it’s broken – and the same is true of too many accounting departments. As a CFO, I can say that the accounting team should be a well-oiled machine, watching the financial health of the company and catching mistakes before they trigger bigger problems. That means that in a small business, when all is well in the accounting department, management focus is directed to inspiring performance with an ingenuity that spurs growth and job satisfaction . . . for the sales team.
But a great accounting department needs motivation too. “Not being broken” is not enough to inspire the highest level of performance you could be getting from a finely tuned team.
I’ve sat in more than one office where cheers from the sales staff are interfering with the accounting clerk’s ability to properly calculate the sales team’s bonuses. Enough already!
With a motivated accounting team, you’re business is likely to more cost savings, more tax deductions, more budget controls, less mistakes, better customer service for your staff and clients and less time for collecting receivables. Furthermore, every year you retain a hardworking accounting clerk in your business is a year you are experiencing increased efficiency as tasks are repeated. Interested?
Inspiring an accounting department is as varied as inspiring sales people. I’d suggest that you begin by making sure you show that you care, with specifics, about the job they are doing and keeping an open dialog about job satisfaction. In my experience, most folks in the accounting department are there, not necessarily because it suits their personality. Perhaps it’s time to find out why the people who work in these sometimes mundane functions choose to do so and motivate accordingly.
The problem I often notice in a smaller business where there is no CFO, is that the CEO doesn’t necessarily have the technical accounting knowledge to specifically challenge the accounting department. In a larger business, the CEO may have the same problem when it’s time to review the CFO’s performance.
In addition to typical personnel strategies, like annual reviews and benefits, consider the following accounting department specific motivations:
- Incentives for identifying, proposing and implementing areas for cost and time savings and improved efficiencies
- Bonuses for minimal internal audit adjustments (i.e. $200 if audit adjusted income is less than 1% change)
- Bonuses for closing and issuing financials by a specific day every month
- Recognition for ideas for better tracking, reporting, and organization in reviews
- Percentage bonus for providing documentation resulting in decreases in taxes, penalties and interest due in an audit triggered by an outside authority
- Perks, bonuses and company paid lunches for supporting audits from outside taxing authorities
- A day or afternoon off after intense periods of audits or year-end closings
- Company paid education in areas of confusion, concern, or changing legislation
I don’t recommend tying accounting department incentives to company sales performance. It’s often during down periods or surprise audits that the accounting department is working extra hard to manage cash flow and negative interactions and that is when you really need them to perform beyond the call of duty. Reducing bonuses or incentives during those times can be highly demotivating.
You might be surprised, after speaking with your accounting team, at some great ideas for increased performance from the accounting team itself. The suggestions above are not only ways to keep things humming with fresh motivation; they make the accounting team feel more valued with the increased interest in their function and careers.
Kira Spivak, founder of CFO Services, has been easing the minds of CEOs and their investors for 19 years. After gaining experience as the Manager of Equipment and Assets for Brannan Sand & Gravel Company and Director of Finance for Renewable Choice Energy, Kira founded CFO Services, LLC in 2007. Ms. Spivak is currently the CFO for Rocky Mountain Excavating and Concrete, Inc., where she has enjoyed the growth phases of transitioning from a small to mid-sized business through challenging economic times. In addition, CFO Services continues to provide financial solutions to corporate clients and investors in a variety of industries.