Page 93 - The Handbook: Law and Accounting Networks and Associations 2019
P. 93
Law and Accounting Networks and Associations
network. Based upon the vast experience in the accounting profession, the combination of independent
firms with a network can create optimal results. This is clearly reflected in the $100-plus billion
annually billed by the Big 4. Their model can now be clearly emulated, not only by the other large
networks in accounting, but also the large networks found in the legal profession.
Economics: Establishing and managing offices in different states and countries is expensive and
inefficient. A firm does not need to be physically present and only requires that structural resources be
in place when clients need them. A network can provide structure for which those resources are
instantly available. The cost/benefit ratio of an office versus network membership is simply too high.
A network is the only cost-effective and efficient alternative.
Demographics: Professional services firms reflect the collective attitudes and perspectives of the
professionals. Attitudes and perspective are different for each generation. Boomers and Generation X
have different perspectives.395 Generation Y396 professionals have now entered the accounting and
legal professions. They have grown up with the same hierarchical institutional foundation as earlier
generations, but they entered the Internet age in their teens. They are part of the new open culture
based upon open relationships with diverse groups around the world. In five years, the first Generation
Z professionals will enter the legal and accounting professions. These are professionals whose lives
are now shaped by the Internet and, in particular, Facebook, LinkedIn, and other Internet tools. They
will carry the social network model to the professional services business network. The outcome is
unknown.
Regulations: Regulations of the accounting profession will continue not only to increase but also
diversify in scope. In accounting, the tension between regulation and self-regulation will accelerate as
other countries assert their authority over their companies. Accounting networks working individually
and as organized interest groups can focus on and address these issues. On the other hand, the legal
profession will not be affected to the same degree because the regulatory balance has already been
achieved. It is not possible for one jurisdiction to regulate the practice of law when the practice is
national or global. This balance will mean that legal networks are in an environment where they can
truly maximize their expansion without regulatory concerns.
Technology: Of the six factors, information technology will have the greatest impact on professional
services networks. It cuts across and is an integral component of each of the other factors for the simple
reason that technology has already revolutionized how people interact with one another. Technology
is scalable so that networks of all sizes are in an optimal position to use technology. Even the smallest
members in the most remote jurisdictions are now linked through the network to meet their specific
needs. The technology enhances both the effectiveness and the efficiency of the services that they
provide their clients. Multi-dimensional technology will mean the clients can be provided cost-
effective and individualized services. Networks, as the consolidator of resources, can provide the
technology to all members.
When these developments are factored into the accounting, legal, multidisciplinary, and specialty networks,
certain patterns develop for the future.
395 Nancy Peppard, Closing the Generation Gap: Managing the Multigenerational Law Firm, 32 L. PRAC. MGMT. 30 (June 2006).
396 Generation Y refers to a generation born between 1980 and 1990. In 2013 this generation would be 23 to 33 years old, representing those who have
graduated or will soon graduate from law and graduate schools. GENERATION Y, en.wikipedia.org/wiki/Generation_Y.
81
network. Based upon the vast experience in the accounting profession, the combination of independent
firms with a network can create optimal results. This is clearly reflected in the $100-plus billion
annually billed by the Big 4. Their model can now be clearly emulated, not only by the other large
networks in accounting, but also the large networks found in the legal profession.
Economics: Establishing and managing offices in different states and countries is expensive and
inefficient. A firm does not need to be physically present and only requires that structural resources be
in place when clients need them. A network can provide structure for which those resources are
instantly available. The cost/benefit ratio of an office versus network membership is simply too high.
A network is the only cost-effective and efficient alternative.
Demographics: Professional services firms reflect the collective attitudes and perspectives of the
professionals. Attitudes and perspective are different for each generation. Boomers and Generation X
have different perspectives.395 Generation Y396 professionals have now entered the accounting and
legal professions. They have grown up with the same hierarchical institutional foundation as earlier
generations, but they entered the Internet age in their teens. They are part of the new open culture
based upon open relationships with diverse groups around the world. In five years, the first Generation
Z professionals will enter the legal and accounting professions. These are professionals whose lives
are now shaped by the Internet and, in particular, Facebook, LinkedIn, and other Internet tools. They
will carry the social network model to the professional services business network. The outcome is
unknown.
Regulations: Regulations of the accounting profession will continue not only to increase but also
diversify in scope. In accounting, the tension between regulation and self-regulation will accelerate as
other countries assert their authority over their companies. Accounting networks working individually
and as organized interest groups can focus on and address these issues. On the other hand, the legal
profession will not be affected to the same degree because the regulatory balance has already been
achieved. It is not possible for one jurisdiction to regulate the practice of law when the practice is
national or global. This balance will mean that legal networks are in an environment where they can
truly maximize their expansion without regulatory concerns.
Technology: Of the six factors, information technology will have the greatest impact on professional
services networks. It cuts across and is an integral component of each of the other factors for the simple
reason that technology has already revolutionized how people interact with one another. Technology
is scalable so that networks of all sizes are in an optimal position to use technology. Even the smallest
members in the most remote jurisdictions are now linked through the network to meet their specific
needs. The technology enhances both the effectiveness and the efficiency of the services that they
provide their clients. Multi-dimensional technology will mean the clients can be provided cost-
effective and individualized services. Networks, as the consolidator of resources, can provide the
technology to all members.
When these developments are factored into the accounting, legal, multidisciplinary, and specialty networks,
certain patterns develop for the future.
395 Nancy Peppard, Closing the Generation Gap: Managing the Multigenerational Law Firm, 32 L. PRAC. MGMT. 30 (June 2006).
396 Generation Y refers to a generation born between 1980 and 1990. In 2013 this generation would be 23 to 33 years old, representing those who have
graduated or will soon graduate from law and graduate schools. GENERATION Y, en.wikipedia.org/wiki/Generation_Y.
81
