By Jessica Salerno-Shumaker, OSCPA senior content manager
High-growth firms have some key differences that set them up for success, according to a recent report, and a critical part of that is making changes to keep up with the evolving business environment.
“We're seeing that the pace of change is moving very quickly,” said Lee Frederickson, research scientist and managing partner at Hinge Research Institute.
In the AAM Marketing Benchmark Study with a special section on high-growth firms, Fredrickson said in their research they looked at the top 25% fastest growing firms compared to lower growth firms to find differences in how they operate.
He touched on three areas that set firms apart: technology, talent and marketing techniques. High-growth firms were found to be more technologically mature than their competitors and this goes beyond standard tax automation software.
“They use technology to keep track of their social media and their marketplace automation,” he said. “And one of the key differences between high-growth firms and, and slower growing firms is the use of customer relationship management or CRM software, where you're keeping track of your marketing, business development and your relationships with clients.”
Social media is another key differentiator between low and high-growth firms. It’s no longer enough to view posting on social media as “free advertising,” Frederickson said, as platforms can be so saturated that generic promotional posts aren’t enough to connect with or find clients.
Instead, top firms use social media as a way of communicating with current and future clients. Sharing industry insights and building relationships on social media is much more effective.
When it comes to talent, the report states that 54.5% of all employees at high-growth firms rate their company culture a nine or 10 on a 0–10 scale.
“High growth firms are more likely to share their ongoing results with their staff and explain what they’re trying to accomplish,” he said. “That is a good example of one cultural practice that really is helpful to folks. And it keeps everybody on the same page, especially if you have remote work.”
High-growth firms are also more likely to pay their staff higher wages and use outside resources to find talent.
All firms need to be able to adapt to these changes, Frederickson said, if they want to keep up with their competition.
“One of the big things people need to think about as they're planning for the future is how they manage in an environment where they have a largely remote workforce,” he said. “We're starting to see some of the impacts of this playing out in the marketplace and these changes are helping to shape the industry.”