Effective communication between an accountant and their client is the key to a successful partnership. Without it, all the numbers and data are useless.
The balance sheet, the income statement, and the cash flow statement (also known as the Big 3) are critical to your client’s financial future. Do not just assume your clients know how to interpret them. Help them to use them to make effective and intelligent business decisions.
One of the most vital responsibilities of an accountant is to bridge the communication gap that happens between numbers-focused people and everyone else.
The Stumbling Blocks of Effective Communication.
To effectively communicate, we must realize that we are all different in the way we perceive the world and use this understanding as a guide to our communication with others.
Both you and your client may be speaking English, but that certainly doesn’t mean there isn’t a language barrier. We are all aware that finance/accounting lingo only works when speaking to another finance/accountant person. Everyone else tunes out when words like the acid test, accrual basis, working capital, and marginal costs.
One of the first things I learned in a communications class in college was that “Message sent doesn’t not equal message received.”
Put away the serious jargon and speak to your clients at their level of understanding. Once you find the common ground of understanding, then honest communication begins.
Listening to Respond, Not to Hear
“We have two ears and one mouth so that we can listen twice as much as we speak.”
When your clients are trying to tell you what they want to know, are you listening? Or are you waiting for them to finish so you can tell them what you want to say?
Your clients may not know how to tell you the information they need. If you find them asking lots of questions followed by more frustration, take a step back and LISTEN. Really listen, then ask follow-up questions.
Listening, genuinely listening is not always an easy task. Here are a few steps to becoming an active listener;
- Pay attention – don’t let your mind wander, don’t check your phone or your watch.
- Show you are listening – Nod your head occasionally and remember body language says a lot.
- Provide Feedback – for example, use terms like “What I’m hearing is…,”
- Don’t interrupt – allow them to finish before speaking or asking questions
- Respond appropriately – ask questions, clarify statements, and respectfully add your opinion.
The End Goal is Misunderstood
When a new relationship begins (whether personal or business), having a common goal is a key to making the relationship work. If two people want entirely different outcomes or don’t know where they want to end up, the chances for success are slim to none.
As a financial advisor, you need to understand your clients’ direction for their company. What are the goals they have for their company? Both long term and short term are significant.
Being in the know and on the same page helps you provide the best information and advice to get them where they want to be. If you know they have a goal to increase the total income by 10% over the next two years, you know better what information to highlight for them in reports. What if they want to reduce expenses?
Many in and out of the industry say computers will entirely run accounting and actual human accountants are on their way out. While we agree computers and software have changed the industry for the better, nothing can replace the human part of accounting—the listening, the understanding, the communication that can never happen with just a number-crunching software.
As an accountant or financial advisor, you can set yourself apart from the competition by improving your communication skills. Unfortunately, it has become an underestimated quality not only in the accounting industry but also in business.
Effective communication will help you stand out from the crowd and take your business to the next level.