In this video I talk about a very important idea… Accounting is about People!
VIDEO SUMMARY
We are going to talk about an idea that is so valuable to understand if you want to be a successful accountant. The idea is this… “Accounting is about people.” This is one of those things they don’t teach you in business school. In business school, you will spend time learning about journal entries, and financial statements, and all those really fun accounting topics. But you have to realize that when you go out and get a job, all that accounting stuff, is only 20% of your job. The other 80% is dealing with people. It is 80% of your job, and we never talk about it! And I shouldn’t be giving business schools a hard time, because I haven’t spent much time talking about it. I spend most of the time on this channel talking about the fun accounting topics. So let’s spend a little bit of time talking about people.
Let’s start by talking through an example of how this plays out. Let’s say you’re a really great accountant. And let’s say you create this incredible financial report. And you walk around your organization and you hand the financial report out to people. And here we encounter one of the great dilemmas of accounting. A financial report is only good if people use it. Just because you have created a report, and just because you have handed it out, means nothing. I don’t care if you are the best accountant in the world, if people don’t use your reports, it means nothing.
Let’s look at the value chain you want to happen:
- Create a report
- Hand out the report
- People read the report
- People react to the report
- The organization makes money
If we look at this value chain, you will see the accounting work is only the first step in the chain. It is only 20%. If you want to be a good accountant, you need to make the rest of this value chain happen. And the rest of the value chain, the 80%, is dealing with people.
Why is dealing with people difficult when it comes to accounting? It is because, most people don’t like accounting. They find it boring, confusing, and scary. That’s right, people are scared of accounting. Let’s think about what is going on here. If you think about the people in your life, a guarantee a large number of them are struggling with money problems. Money is one of those things people have a really hard time with. And so many people out there have negative emotions about money. They have pain and fear associated with money. Well all these people work in businesses. So it’s really important to realize that a large part of your workforce may or may not have negative beliefs about money. And here you come, walking down the hall, waving your financial report. What do you think people are going to do with it? Some people might be busy, some people might not care, and some people might be scared.
The question becomes, how do you encourage the people in your organization to read and react to your financial reports? 80% of an accountant’s job is inspiring people to act with fiscal responsibility. This means training people and showing them the benefits of accounting best practices. Imagine how powerful it would be for a business, if every person in the organization appreciated the insights that are in your accounting system.
The takeaway from this video, is to look for those opportunities to be a leader for fiscal responsibility in your organization. Accounting is a really cool thing. Inspire people to love accounting. And realize, that what we are taught in business school is only 20% of your day-to-day job. To really add value as an accountant, you need to be able to take the accounting and use it to impact your organization.
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Neither Zach De Gregorio or Wolves and Finance Inc. shall be liable for any damages related to information in this video. It is recommended you contact a CPA in your area for business advice.