Managing the Fears of Practice Transition

by Ira S. Rosenbloom, CPA | Nov 28, 2016

Pennsylvania CPA JournalA successful firm transition requires many factors to align properly. The transition plan will usually focus on finances and terms, but not so much on human factors – chief among them being fear. If you’re a firm owner considering a merger/sale or acquisition, some level of fear is a normal emotion and, in fact, crosses both sides of the table. How you manage trepidation can make or break the deal. Here are some of the more common fears I’ve observed, as well as recommendations on how to deal with them.

Fear of change – The uncertainty of the results of change can be frightening to many people. Every accounting firm transition is going to bring change. Concentrating on how that change will make things better and putting a process in place to ensure that the better results occur will go a long way toward alleviating this particular fear. Keeping the dialogue focused on realistic benefits will allow confidence to brew and take away the urge to wonder about the downside.

Fear of a change in control – If you’re accustomed to calling the shots, ceding control, fully or partially, to another partner can be frightening. Similarly, if you have not had much authority, gaining control can bring anxiety. Mapping out a solid definition of the range of authority, responsibility, and expectations will create comfort and allow you to better control change in critical areas.

Fear of a lack of relevance – Transitioning from being the big kahuna may be the intellectually right path, but often it is not psychologically appealing. It is normal to wonder about a new role as something other than the boss and the ability to perform in that role. Taking the time to discuss which clients and functions will be transitioned and over what time frame will not only make for a smooth process but will also make all players in the process relevant.

Fear of the economic results – Nothing is guaranteed in life. Economic risk will exist whether a transition takes place or not. Oftentimes the greater risk will emerge without transition. If the deal is set up to maximize the likelihood of achieving the changes you want in terms of earnings and payouts, with protection from specific failures or missteps and realistic financial targets, this fear will subside.

Fear of proving yourself – Everyone has their own tolerances and acceptability ranges. Moving from an environment where you are aware of each other’s tolerances or where you are the only judge that matters to one with a panel of new judges may be nerve-racking. When mutual parameters and performance standards are set and all parties work together to achieve the result, the process won’t be one-sided. Accountability won’t be a punishment but a collaborative best practice.

Fear of client reaction – Negative client reaction is a problem for any business, especially one in transition. Worrying about how clients will perceive the transaction is often misplaced, but it should not be downplayed. The more transparent the parties are with clients, the easier it is to gain their support. Create talking points on the benefits of the deal, and share them with clients. If there is an internal transition, stressing continuity and familiarity with the existing partners will calm the clients. Expanded services and improved customer care, while maintaining billing structure, can inspire loyalty and minimize negative reactions.

Fear of staff reaction – Any change will be unsettling to staff, no matter which side of the table they’re on. The likelihood of complete staff retention after a transaction is slim, but keeping your stars has to be a priority. If you keep staff in the loop about the transaction, you’re more likely to gain their cooperation. Bonuses, clear opportunity for advancement, and incentives for staying on can effectively quash employee concern.

Fear of the end – If the deal also represents your exit strategy, worrying about what to do next is common. When the familiar ends, it makes you wonder what else will end and what the consequences will be. Using the deal as a means to focus on other interests and things you enjoy doing is a great way to address this fear. Ideally, the new owner will support those outside interests and value having a seasoned professional available to mentor younger staff.

Fears need not be paralyzing, and most are healthy. If you have them, put them to use. You can create the most comfortable combination for the parties, or, sometimes, you may even recognize that the deal should not be done. 

Ira S. Rosenbloom, CPA, is chief operating executive at Optimum Strategies LLC in Spring House. He can be reached at

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