You know how I love taking stories from outside the tax world – from places like politics and pop culture – and using them as examples to illustrate ways to market and manage your business. Today we’re going to turn to science – specifically, the concept of natural selection – to illustrate how to handle a threat to your very existence. Sounds fun, right? Let’s get to it!
Imagine you’re part of a herd of buffalo slowly moving across the American plain. A herd of buffalo can only move as fast as the slowest members. And when someone hunts the herd, it’s the slowest and weakest buffalo at the back of the herd that are killed first (and thereby fail to reproduce later). This natural selection is good for the herd as a whole, because the general speed and health of the herd are improved by losing the weakest members.
(Saturday, I celebrated my 17th year of sobriety. The same principal of natural selection applies to brain cells. The human brain can operate only as fast as the slowest brain cells. Now, drinking beer kills brain cells. But the beer kills the slowest and weakest brain cells first. In that way, regular alcohol consumption eliminates the weaker brain cells, making the brain a faster or more efficient thinking machine. At least, that’s what I always told myself back when I was drinking.)
Ok. What does any of this have to do with you?
Let’s take a look at our business: the business of helping people with their taxes.
There are certainly some fast people in our business. Most of us are among that group. We don’t just settle for telling our clients how much they owe. We proactively work to help them pay less. We don’t just tell them what they need to know. We go beyond and tell them what they want to know.
But will that be enough to keep us at the front of the pack?
Can I be completely honest for a minute here? Even if it means telling you something you may not want to hear?
We all know who the weak members of the herd are. They’re the old-school “tax preparers.” They may be CPAs or EAs, or they may not. They may have nice offices, or they may be stuck in a crappy strip center between a check-cashing place and a tattoo parlor. They may make a nice income, or not.
But they have a deadwood attitude. They’re really just hanging on. They’re just “doing taxes.” They’re taking as little CE as they can get away with in order to stay current on “doing taxes.” And when they stop by the TaxCoach booth at an NATP or NAEA show, they tell us they’re not interested in “tax planning” because they “already do tax planning” (which we know isn’t true) or they aren’t even interested because they just “do taxes.”
Those people aren’t even the weakest buffalo at the back of the herd. They’re the weakest dinosaurs at the back of the herd. The meteor is headed straight for them. And they’re so oblivious, they have no idea it’s coming.
Artificial intelligence and machine learning are about to change the way the tax business operates. It used to be that technology could help you do your job more efficiently. Now it’s starting to do your job for you. And the first ones to lose their jobs to the robots will be those back-of-the-herd “tax preparers” who obstinately refuse to adapt to the new reality.
What does that mean for you? Well, the gap between you and the back of the herd is going to get narrower. As more people lose their routine tax-prep business, more people will start to do the sort of planning that you’re already doing to distinguish yourself from your competition. And you’ll start to feel the heat.
The answer, of course, is to find ways to stay a step ahead of the new planners.
How will you do that? How will you build on your current success as being “more than just a tax preparer”? Will you find ways to bring proactive planning to more clients? Will you add business advisory services? Will you add financial services?
Take some time to start thinking about it now. Here at TaxCoach, we think being a tax planner is the best way to stay ahead of the herd. But that won’t always be true. So where do you want to turn next to keep up your advantage? And how do you want us to help you do it?