Technology Talk

Jerry Topp is a former high school teacher, a 25+ year public accounting practitioner,
and, above all, a leader and a motivator. He heads a powerhouse firm headquartered
in, of all places, Fargo, N.D. I met up with Jerry as he was in Sioux Falls,
S.D. announcing the acquisition of yet another firm there — this one adding
over $5 million in revenue, 45 professionals and swelling the Eide Bailly ranks
in Sioux Falls to an astonishing nearly 200 people.

Editor’s note: In the spirit of full disclosure,
please note that I am one of those 200. I office with Eide Bailly so I can continue
to experience the joys of practicing public accounting. I just LOVE the smell
of tax returns in the spring! ~ Greg LaFollette

Greg LaFollette: You have a lot of zeros to talk about —
$100,000,000 in revenue, 1,000 staff members, and 100 partners. That’s
very impressive. Tell me a little more about Eide Bailly and the markets you
serve.

Jerry Topp: Eide Bailly LLP is a regional firm that operates
primarily in the Great Plains and rocky mountain regions of the United States.
This encompasses 13 offices in eight states — Minnesota, Iowa, North Dakota,
South Dakota, Montana, Idaho, Arizona and Oklahoma.

Greg LaFollette: You’re quite disciplined geographically.
What’s your strategy?
Jerry Topp: Because of the large number of regional accounting
firms that operate east of the Mississippi River, our current strategy is to
grow the practice west of the Mississippi and concentrate on the larger secondary
and metropolitan areas in those regions.

Greg LaFollette: Your affiliate network, PracticeWise, seems quietly
popular. Do you spend a lot of time on it?
Jerry Topp: Personally, I will spend a great deal more time
with this network in the future. We developed the network to concentrate on
the management issues of firms that are outgrowing their current infrastructure
and are looking for some assistance and guidance from not only our firm but
also from peer firms. PracticeWise presently includes 17 member firms in 13
states. The firms are represented in size from approximately $1
million to $20 million in revenues.

Greg LaFollette: You’ve personally come from 14-column
workpaper to paperless engagements and e-mail via smartphones. Are we really
better off?
Jerry Topp: I think you could find a few folks around our firm
that may wonder, but I am certain that technology has been, is, and will continue
to be the major source of advancements and efficiencies in our profession. The
speed of communication and the response time expected by our clients has changed
dramatically. One might wish for the past, but the reality is that people are
connected virtually non-stop. And our clients expect that we have the most up-to-date
information available at our fingertips at a moment’s notice.

Greg LaFollette: I’m interested in your opinion of the
role of technology in the practice of public accounting. How important is technological
competence to today’s practitioner?
Jerry Topp: Simply put, it is a mandatory. Each person may
not need to know all the applications we run in the firm, but all of our practitioners
need to be competent on systems that impact their functional areas, such as
tax and audit, as well as those of their clients, as the transfer of information
electronically is the norm and will continue to evolve at a rapid pace.

Greg LaFollette: Many firms are completely suite oriented in software
selection, but Eide Bailly is decidedly “best of breed” in its process.
What are your thoughts?
Jerry Topp: We spend a great deal of time and resources looking
at emerging technologies and how they may impact our practice. And we hire experts
to guide us along this path. Their charge is to seek out the best applications
available and determine how they might work in our firm. If we were to simply
purchase a suite of applications, we could miss a leading-edge application and
impact our long-term efficiency.

Greg LaFollette: Infrastructure, software and training — from
an executive level, how do you balance investment in each. How much do you invest
in those areas?
Jerry Topp: Our model has specific percentage expectations
for each of those areas. Our Chief Operating Officer and his department managers
(technology, finance, communications/marketing, training and human resources)
all operate within those budget constraints. We don’t cut corners in these
areas as our partners expect that people will be adequately trained and have
the resources necessary to serve the clients’ needs. Our technology budget
for the last three years has averaged 6 percent of our firm’s revenue,
or approximately $6,500 per full-time employee.

Greg LaFollette: You’ve been quite acquisitive lately. Tell me
how a firm’s technology adaptation influences your interest in acquiring
that firm.
Jerry Topp: Our history has shown us that it may take up to
two years to get an acquired firm up to speed with our procedures, technology,
systems, etc. If we find a firm that uses similar systems to ours, it definitely
shortens the learning curve and may peak our interest in that firm.

Greg LaFollette: When bringing an acquired firm into Eide Bailly, do
you notice that technologically “advanced” firms tend to assimilate
more quickly?
Jerry Topp: It certainly helps if the firm has a learning culture
with respect to new ideas and technological advancement. I think the real value
of that type of culture is to reduce the stress on the individuals of how much
change they will be subjected to as a result of coming into the new firm. However,
we have also learned that virtually all partners and staff who have joined the
firm have the capacity to learn and adapt.

Greg LaFollette: How many miles did you log last year? As a
“road warrior,” what’s your personal favorite piece of technology?
Jerry Topp: Between airplanes and automobiles, more that 50
percent of my time is spent “on the road” with our offices, network
firms and prospects. For me, wireless remote high-speed access is the one piece
of technology without which I simply couldn’t operate. The availability
of high-speed access in airports, airline club rooms, hotels, coffee shops,
etc., has also made this easier. I also carry a Verizon wireless Internet card
in case the above options aren’t available.