Prepared by:David Griffiths, PhDFounder k3-Cubed Ltd

CPA CORE COMPETENCY SAMPLE BM REPORT

Firm: Sample CPAsDate: May 2013

0.1 Index

1.1 Briefing - 41.2 Report Focus - 51.3 Data Interpretation - 61.4 Legend - 7

2.1 Participation Breakdown - 10

3.1 Headlines - 13

4.1 Stories - 154.2 Feelings - 16

5.1 Sharing Knowledge - 185.1.1 Knowledge Culture - 215.2 Entrepreneurship - 225.2.1 Entrepreneurship 2 - 245.3 Relationship Building - 265.3.1 Relationship Building 2 - 285.4 Synthesising Intelligence - 305.4.1 Synthesising Intelligence 2 - 325.5 Leadership - 345.5.1 Leadership 2 - 375.6 Communication - 405.6.1 Communication 2 - 425.7 Critical Thinking - 44

6.1 Notes - 47

7.1 Contacts - 492

1.0 OVERVIEW

1.1 Briefing

• This is a sample report from 78 CPAs across 6 firms (represented for the purpose of this sample report as a single firm - see notes in Section 6.1). Individual firm reports would be set against the context and needs of the firm, which are determined via face-to-face and telephone interviews. Individual firm level report outputs would provider a deeper breakdown of the data than those in this sample report; demonstrating opportunities and threats based on a range of filters: location (for firms with multiple locations), age, experience (such as time as a certified CPA), position held, position desired, feelings about the future of the firm etc.

• The outputs are anonymous, but personal reports and guidance (professional development, career development etc.) can be provided to all respondents (coming fall 2013).

• CPA Core Competency performance is linked to the individual and organisational context. They cannot be separated and therefore reports also explores individual stories, feelings and perceptions. This element of the process primes the data to bring a richer degree of sense making when considering the story to be told through the report.

• The individual, the firm and the environment do not sit in isolation, they interact to produce a complex whole. The reports produced using the SenseMaker process address all three aspects, providing firms with a deep insight into the present and future.

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1.2 Report Focus

• Nobody can tell you what the future will look like, but your past and present certainly influences it. The question is, how much do your people know about themselves and how much do you really know about your firm?

• All organisations, at some point, will transition through periods of growth, preservation, destruction and reorganisation. The events that will shift you from one phase to another can sometimes be predicted, but more often they are unforeseen. Today’s organisations operate in an environment that is more connected, interdependent and diverse than ever before. This creates an environment, where the only certainty is change.

• Your ability to adapt to this changing environment, to solve problems and make decisions, is fundamentally built upon the knowledge, skills and experience of your people. Your human resources are your biggest assets, but are they prepared for the challenges that lie ahead?

• To help you find out, INCPAS has partnered with K3-Cubed and Cognitive-Edge to provide a scanning solution powered by SenseMaker™, one of the most potent insight tools available today and used by government organisations the world over.

 • The outputs from this scan will provide a powerful insight into CPA Core Competencies,

as they exist within your organisation. Have no doubt, this scan can have a significant impact upon your operational and strategic planning processes. The results will give you a rare insight into your capabilities that you will probably not have seen before.

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1.3 Data Interpretation

• The insights expressed in this report have been developed via several powerful quantitative and qualitative analytic tools. In the first instance the stories told by the participants, as well as the “feelings” toward those stories, set the context for the presentation of the data (see section 6.0 for further details on data credibility/reliability.

• Each respondent’s story is compared and contrasted against his or her responses to each individual question, as well as other respondents at a similar position, years as a practicing CPA and number of years with the firm. Responses are then compared and contrasted against the entire population of the scan.

• Data is formatted and presented according to the nature of the patterns that emerge in the analysis, using a minimum of 3 different analytical tools to strengthen credibility.

• The integrity/reliability of the analysis is verified using a random selection of respondents. Here an internal verification process is applied, where respondents are contacted to confirm that the interpretation of their data accurately reflects their views.

 • Stories are analysed in isolation and as part of the wider whole. Through this process

data is coded and clustered around themes that are of relevance to the firm. For example, you might see a central theme (a lack of growth) that is informed by 4 sub-themes (talent management, critical thinking, growing a network and developing services). Data analysis is then conducted and presented against this background noise. In an individual firm report, and where appropriate, a reminder of this “noise” is provided via quotes, to assist in contextualising points of reference in the data. 6

1.4 Legend

BAR CHART:

Each ‘block’ = a scan response. Green line = Median. Red line = Average. Shaded area = area for observation.Arrow = Point of interest Discussion is based on responses that emerge in the shaded area, with responses at the extreme showing a strong affinity toward the opinion expressed.

Strong affinity

LEGEND – TRIAD SCATTER CHART:

Scatter clusters are highlighted with circles and arrows. Each dot = a response. Where multiple colour dots are used, this indicates a filter (age/position/experience etc.) and in a full report an additional legend would be provided. The closer to the “point” or side of a triangle, the stronger the affinity toward a specific view.

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1.4 Legend

LEGEND – LANDSCAPES:

Used to visualise a large data landscape around three responses. Arrows indicate a trend or point of interest for discussion.

LEGEND – TEXT COLOUR CODING

Critical: Action needed   Be aware: This area has the potential to become “critical” 

 Good performance: Continue to monitor

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2.0 PARTICIPATION9

2.1 Participation Breakdown

10

38%

4%6% 4%3%

19%

26%

Function

Accounting Services AuditCFO ConsultingManaging Partner Other ExecTax

12%

42%

46%

Sex

Male Female No Answer

2.1 Participation Breakdown

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1%

26%

3%

15%

19%

17%

19%

Position

Accounting Services AuditCFO ConsultingManaging Partner Other ExecTax

6%8%

18%

21%23%

24%

Age

20-29 30-39 40-4950-59 60-69 70+No Answer

3.0 HEADLINES12

3.1 HeadlinesCompetency Signals:

These are the strong and weak competency signals received from the data. Strong signals mean that the respondent displayed a strong affinity (clearly aligned her/himself with the response) to either the excellence or quality statement. A weak signal is interpreted as a person who has no defined alignment, but their positioning on the triad suggests weak alignment toward the excellence or quality statement for the competence under question.

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Knowledge SharingEntrepreneurship 1Entrepreneurship 2

Relationship BuildingSynthesising Intelligence 1Synthesising Intelligence 2

Leadership 1Leadership 2

Communication 1Communication 2

Critical Thinking

0 12.5 25.0 37.5 50.0

Excellence Signals: All respondents

Strong Weak

Knowledge SharingEntrepreneurship 1Entrepreneurship 2

Relationship BuildingSynthesising Intelligence 1Synthesising Intelligence 2

Leadership 1Leadership 2

Communication 1Communication 2

Critical Thinking

0 17.5 35.0 52.5 70.0

Quality Signals: All respondents

4.0 STORYTELLING & FEELINGS14

4.1 Stories Stories being told in your firm today:

Four impact story themes (two in particular, Staffing and Strategy) emerge around a core theme of growth.

People speak of a need for better leadership and direction. There is also concern around the future (coming from more senior CPAs) and what that could mean in terms of the value of the firm. There is considerable tension around staffing, specifically work load versus reward, a lack of clarity when it comes to career path, issues of general talent management and succession planning (linked to discussions on the future). Strategy stories are split between traditionalists (stick to what we know) and adventurists (seek out new products and services to stay relevant).

Positive stories surface in relation to job satisfaction (mainly at the Partner level) and the motivation CPAs get from moving into new service areas and solving new problems. 15

4.2 Feelings Feelings:

These are the feelings used to describe the stories told by the participants at the outset of the CPA Core Competency Scan. These feelings help set the context for individual and collective responses within the data set. Feelings are compared and contrasted across filters (e.g. position, age, years as a professional CPA) to explore patterns that might emerge around a particular area (e.g. Partners dissatisfied with the potential of new staff).

In the case of this firm, no significant negative patterns emerged. Although it should be noted that the feeling of being “exposed” resonated within responses from Managers. This is an area that should be explored further at the firm level.

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4%3%

4%

45%

3%1%

12%

8%

10%

8%3%1%

Respondent Feelings

Angry Bewildered BitterEmpowered Excited ExposedHappy Incapable IrritatedMotivated Nonchalant NumbSad

5.0 CORE COMPETENCIES17

5.1 Sharing Knowledge

HOW WOULD YOU DESCRIBE YOUR ABILITY TO SHARE KNOWLEDGE?:

Your ability to share knowledge is essential to decision making and problem solving capability. Have you considered the effectiveness of your knowledge flows?

Over 50% of the firm only share knowledge when called upon. You may not see this as a problem, but now consider that 8 of 15 (53%) of your Managers only share when called upon (a basic competency indicator).

Compare this to other functions within the firm (next 4 diagrams) and you begin to see a vulnerability in the firm’s future capability to adapt – especially considering the age of the Executive Board and the impact on future leadership needs.

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Excellence: Activist - I lead on, encourage and provide opportunities for knowledge sharingQuality: Catalyst- I tend to receive and freely distribute knowledge

5.1 Sharing Knowledge

HOW WOULD YOU DESCRIBE YOUR ABILITY TO SHARE KNOWLEDGE?:

Compare your Managers to Partner Member Shareholders and, as should be expected, there is a dramatic shift toward knowledge catalysts and activists. This is positive, but to enhance leadership in this area, there is still the need for professional development to transition more “catalysts” to become “activists” (a shift from quality to excellence).

Compare the Partner Member Shareholders to Partners and there are not enough ”activists” in the firm. Again, from a leadership perspective, you need to consider what message is being transmitted to general staff.

This concern is reinforced when reflecting back on your Managers, but this also applies to Seniors and Staff Accountants (next 2 diagrams).

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5.1 Sharing Knowledge

HOW WOULD YOU DESCRIBE YOUR ABILITY TO SHARE KNOWLEDGE?:

7 of your 12 Seniors see themselves as only sharing when called upon. Now compare this to the bottom diagram (Staff Accountants) where the vast majority see themselves as only sharing when called upon.

Are you concerned and do you see the need for leadership in this area? How does this impact service provision? Growth? Client retention? Succession planning – will your future leaders be able to lead in this area and is it important to you? How could this impact signal detection or horizon scanning for strategic planning? How will this impact your ability to adapt when the unexpected happens?

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Seniors

Staff Accountants

5.1.1 (Culture) Sharing Influencer

The culture of my organization is best described as follows: “Leaders set the example and reward knowledge sharing” or “Share any knowledge and others will take credit, it’s a dog eat dog world”.

The overwhelming opinion is that leaders set the example and reward knowledge sharing. This is a positive and should be celebrated. However, this should not detract from the data presented in 5.1, where there are emerging issues in the area of knowledge sharing that could/should be addressed.

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Strong affinity

“Leaders set the example and reward knowledge sharing”

5.2 Entrepreneurship

In providing client services, do you tend to..?

Here the interest is in your ability to discover new services (especially when considering a strategic shift from service provider to solutions provider). To adapt to changing client needs. To determine whether your firm tends to wait to react or act to prevent.

Does your current practice do a good job of sensing signals of change or do you tend to stick to what you know, regardless of what else is happening?

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Excellence: Explore and actively review existing offerings to better match market demandQuality: Think outside the box to extend what you offer to fit the needs of the client

5.2 Entrepreneurship

In providing client services, do you tend to?

There is a good balance (distribution) of Partner responses in relation to this competency. This said, development time would be well invested in those with a leaning toward “Utilize existing service offerings”. While a balance and push back on “rainmakers” is appropriate, it is important to ensure that a potential leaning toward traditional approaches within the firm is well founded.

Seniors, perhaps due to the nature of their position, lean toward the use of existing services. The problem here is that this position forms part of your sensory network and if they are not listening to signals that indicate a change in client need, who is? Would it not be better to spend development time transitioning Seniors toward a position where they begin to “think outside the box”?

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5.2.1 Entrepreneurship 2

What is your approach to delivering client service solutions?

The interest here, again, is on the evolution of services to ensure a personalised (individual-centric) service provision for clients - an essential element in the evolution from “service provider” to “solutions provider”.

Managers, in the main, are focused on “Keeping within cost”. If that is the case, how are they personalising individual solutions? Is this caused by a firm focus on traditional “billable hour” driven solutions/thinking or project working? To complicate matters, Seniors, exhibit only weak bonds to the same basic competency indicator. Why is this?

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Excellence: Work to give the client what they need, even if they don’t know it at the timeQuality: Build the relationship, including some freebies

5.2.1 Entrepreneurship 2

What is your approach to delivering client service solutions?

Partners are in need of development. There are strong bonds to quality competency indicators, but at this level you should see a stronger/developing bond to excellence indicators.

Compare Partners to Partner Member Shareholders and the development work that needs to be done is clear. The Partner Member Shareholder position is an ageing one. How are you preparing for loss in this area? At what cost to entrepreneurship? What cost to relearn what you already know, in terms of service development/provision?

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5.3 Relationship Building

If others were looking at my approach to relationship building, they would say..?

Many CPA firms have a strategy that is described as being focused on growth. This growth is often attached to the network size, and influence within that network, of the individual CPA. Accepting that there will always be “technicians” within a firm, there is still an expectation for a CPA to be able to contribute to growing the firm’s network.

Look at the data, the signals suggest that Managers and Seniors are not in alignment with the view above. Too many exhibit strong bonds with the basic competency descriptor.

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Excellence: I act as a connector, extending my own professional or client relationships, while at the same time acting as an advocate for othersQuality: I seek out new opportunities to extend my professional or client network

5.3 Relationship Building

If others were looking at my approach to relationship building, they would say..?Staff Accountants cluster around a strong bond to the basic competency descriptor. The 5 outliers (top diagram) could indicate staff ready for promotion.

The data suggests that Partner Member Shareholders are driving growth. This needs to be risk assessed as part of the firm’s succession planning processes. There is a high probability that loss in this area will have a high impact on network/firm growth and influence.

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5.3.1 Relationship Building 2

If colleagues were to comment on the strengths of my relationships I have established...

The extent and diversity of personal networks are key to environment scanning, decision making and problem solving capability/capacity. The power of the individual network, and its contribution to the power of the firm network, is linked to connectivity and diversity.

Managers (top diagram) and Partner Member Shareholders (bottom diagram) both exhibit similar patterns when it comes to weaknesses within their current networks. This has to be an area for concern, as it seems as if the focus is on clients, which will impact future resilience (connectivity being linked to a firm’s agility in the face of unexpected problems).

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Managers

5.3.1 Relationship Building 2

If colleagues were to comment on the strengths of my relationships I have established...

The pattern does not change that much when looking into the data from Partners. This reinforces the concern for the firm as it looks towards the future.

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5.4 Synthesising Intelligence

In making judgements about an intractable problem, I tend to..?

The ability to receive signals from the environment is one thing. The ability to act is quite another. This competency informs firm level capability to respond to emerging client needs (service provider versus solutions provider). Do you stick what has gone before? Do you adapt according to experience and new insight? Or do you experiment (scaling failure) with new service options?

Managers display a tendency toward quality competency descriptors, although the bond could be stronger. There is a weak bond to quality amongst Partners and alignment with excellence has to be a development concern.

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Excellence: Experiment and try new things outQuality: Draw on past experience and insight

5.4 Synthesising Intelligence

In making judgements about an intractable problem, I tend to..?

Staff Accountants have a stronger bond to the quality competency descriptor than Seniors. But the concern, as has been expressed throughout this report, is that Partner Member Shareholders appear to drive firm level advantage in this area. This must have implications for succession planning processes.

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5.4.1 Synthesising Intelligence 2

When faced with an unexpected problems as a CPA, I tend to?

Continuing the theme of sense making and adapting service provision in response to client/environment driven business intelligence, there are adequate signals of adaption (indicated by the green areas) or bonds to the quality based competency. This said, there appears to be far too weak of a bond to the excellence based competency indicator.

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Excellence: Challenge existing practice, leading on the development of new practiceQuality: Review existing practice and adapt according to need

5.4.1 Synthesising Intelligence 2

When faced with an unexpected problems as a CPA, I tend to?The recurring theme in this report is the firm dependency upon Partner Member Shareholders to align with excellence competency indicators. How does this align with current development and succession plans?

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5.5 Leadership

Leaders in my setting usually focus on or, as a leader I usually focus on..?

How does leadership align with your strategic needs? If you want to trasnsition from a service driven to a solutions driven firm then there has to be consideration of the leadership style. Partner member Shareholders and Partners both follow similar patterns, aligning with the quality competency descriptor.

This could be a problem when is comes to the agility/resilience of the firm, but, more importantly, it could be influencing responses from staff/seniors/managers in other areas.

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Excellence: Promoting diversity and innovationQuality: Empowerment and delegation

5.5 Leadership

Leaders in my setting usually focus on or, as a leader I usually focus on..?

Of concern, Managers and Seniors both align with the basic competency indicator. This is problematic as these people are the future of your firm and are also responsible for influencing Staff Accountants. Is this what you want to be communicating, in terms of a leadership style?

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5.5 Leadership

Leaders in my setting usually focus on...

This is how Staff Accountants see leadership within the firm. The clustering around the basic competency descriptor is a potential issue. If growth of service provision (via a personalised service approach and the ethos of a solutions provider) is important then development in this area has to be considered.

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5.5.1 Leadership 2

Leaders in my setting are best described as or, as a leader my colleagues would describe me as...?

Here the interest is in leadership style, from a basic (transactional, “assertive”) approach to that of excellence (transformational, “altruistic”).

Both Partners and Partner Member Shareholders display a range of leadership styles. This said, the strong and weak ties to the basic competency descriptor could be a cause for concern. Further enquiry is need in this area to find out why this is happening. Indications from the stories told would suggest that this is an area that needs to be addressed in terms of development.

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Excellence: Altruism (Transformational approach)Quality: Analytical

5.5.1 Leadership 2

Leaders in my setting are best described as or, as a leader my colleagues would describe me as...?

Seniors are tied to the basic competency descriptor, but, encouragingly, Managers are strongly tied to the quality Leadership descriptor. Considering these people are the future of the firm, talent management processes need to be reviewed to ensure that their professional development reflects growth toward excellence.

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5.5.1 Leadership 2

Leaders in my setting are best described as...?

The feedback from Staff Accountants is in line with the data from the other positions within the firm. The concern is that not a single response (zero) indicated the existence of altruistic leadership within the firm. The quality competence indicator dominates, but there are significant weak ties toward the basic competence indicator, which need to be monitored.

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5.6 Communication

To me, effective communication means?

Communication allows sense making messages and know-how to flow vertically and horizontally within the firm. Disruptions in this area can impact signal detection and response (efficiency and effectiveness).

Managers believe that communication is aligned with the basic competency, with only weak ties to the quality based competency, “Clarity” - this could also align with an “assertive” leadership style. Of concern is that firm leaders (Partner Member Shareholders) also have strong ties to the basic competency descriptor.

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Excellence: Negotiation, getting to win-winQuality: Clarity

5.6 Communication

To me, effective communication means?

There is a better spread of responses amongst Partners. However, there is work to be done in the development of Seniors and Staff Accountants if the firm is to work toward resilience for the future.

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5.6.1 Communication 2

Colleagues would generally describe my communication skills as...?

The potential issues with firm level communication spill over to this second aspect of the competency. Many Managers have strong/weak ties to the basic competency descriptor, while Partner Member Shareholders would seem to need to a better job of leading development in this area.

How will that growth be achieved? Traditional services might align with this level of communication. Innovative service development (solutions provider) does not align well with the basic/quality communication competency descriptors. Why is the firm like this?

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Excellence: A negotiator, you look to engage widely and understand the needs of othersQuality: A catalyst, you look to bring others into the conversation

5.6.1 Communication 2

Colleagues would generally describe my communication skills as...?

Here too Partners need development, especially considering succession planning. There is also development potential for Seniors and Staff Accountants.

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5.7 Critical Thinking

As a professional, when faced with a problem I generally believe it is important to...?

Critical thinking is a strength for the firm, although it does not seem to link to other key competency areas, such as Entrepreneurship.

Managers are particularly strong in this area. The only concern that Partner Member Shareholders could be exhibiting a “traditionalist” approach, which links to the basic competency descriptor. Otherwise, this is a core strength in the firm data.

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Excellence: Gather evidence and present a solution, even if unconventionalQuality: Talk to colleagues and go with consensus

5.7 Critical Thinking

In providing client services, do you tend to?

There are small areas of development need, but this are could be described as a core strength of the firm. How can this be exploited to enhance future growth and resilience?

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6.0 NOTES46

6.1 Notes

Notes:

This is a generic benchmarking report taken from participants across six firms. The level of coherence from respondents, regardless of firm, and across filters, such as time as a certified CPA, position, and position desired, has enhanced the pragmatic validity of the data.

At the time of writing this report, two on site visits, lasting 5 days (including 18 face-to-face interviews and 4 Senior Management Team briefings), had been concluded to validate the credibility and reliability of the data submitted by the respondents. In both cases the data was found to accurately reflect the reality being experienced inside the firm.

This is a basic benchmarking report. Firm level reports would include feedback focused on the future resilience of the firm. This would be achieved by extending the data to explore filters, such as the position desired by respondents. From this data it would be possible to analyse factors that contribute to the future agility or resilience of the firm.

It is also possible to discuss risk, as was highlighted in this report, by examining, for example, age according to function and position. As an example, the age of Partner Member Shareholders was identified as a challenge for the firm moving forward, especially when considering their contribution to excellence within the core competency descriptors.

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7.0 CONTACT DETAILS48

7.1 Contacts

Key Contacts:

David Griffiths, Founder K3-Cubed Ltd

Email: david@theknowledgecore.comSkype: davidALKaMETel: +44 (0)7500 966998LinkedIn: uk.linkedin.com/in/davidgriffithsk3cubed/web: www.k3cubed.com and www.knowcademy.net or .co.ukBlog: www.knowcademy.com

INCPAS:

Contact: Gary Bolinger (President and CEO)Email: gbolinger@incpas.orgTel: 001 317 726 5017Web: www.incpas.org

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