PKF Cooper Parry CEO, Ade Cheatham, meets us in jeans, a Paul Smith shirt and trainers at Sky View, the firm’s vibrant and colourful offices next to East Midlands Airport. As we’ve reported before, these offices shout “Apple” far louder than “audit”, which isn’t surprising given Ade’s explanation: “The design brief was simple – to think about what accountants’ offices should look like and build the exact opposite.” As a result, Sky View, which opened in May 2014, feels like a hive of activity when we arrive. It is all about break-out spaces, sofas, coffee cups and iPads.
But why? What drives PKF Cooper Parry’s desire to be so very different? Why do they give their staff unlimited holiday? Why the jeans? We’re here to find out. But before we do, let’s note a few facts that make the PKF Cooper Parry story so compelling. Firstly, the firm is back in the Sunday Times 100 Best Companies to Work For after a seven-year absence, the only firm of accountants to make the small companies list. Secondly, it has been shortlisted for the Most Innovative Firm of the Year at the upcoming British Accountancy Awards. Thirdly, it acts for more owner-managed businesses in the Midlands with a turnover of £5m to £200m than anyone else. And fourthly – and most impressively – PKF Cooper Parry is now the fastest-growing accountancy firm in the UK with 34% growth last year and a further 45% this year. These facts may rather stick in the craw of those who are inclined to see the firm as ‘a bit out there’ just for the sake of it. So how has PKF Cooper Parry done it and what can other, more traditional, firms learn from its journey?
To trace the roots of the current success requires a trip back to 2003 when the last generation of partners retired and handed the baton to a new group of thirtysomethings. A group who were desperate to create something different and make their mark. Ade explains: “Many of us had started out at big four and mid-tier national firms where we quickly became frustrated by the red tape, bureaucracy, shocking communication and the fact that all decisions were made in London. We knew that we wanted to build something very different from the firms we’d left. Something that ripped up the rulebook and challenged every stereotype of accountants. Something exceptional.”
The ambitious new team was of a similar age and view and quickly bought into a shared vision to disrupt, lead and make the most of life. Most importantly, they were not held back by older partners wishing to “play it safe” before retirement. And the conservatism, stuffiness and glacial decision making that the partners had experienced in their previous firms were rejected in favour of a bold, new, entrepreneurial plan.
This shiny, new-look PKF Cooper Parry immediately identified the owner-managed sector as its primary target. Ade says: “In the early to mid-2000s, we went to market with all guns blazing. We knew that we wanted to work with entrepreneurial businesses – people who saw the world like we did. So we structured our whole firm to serve that market and we experienced fast growth, geographic expansion, and a progression up the food chain in terms of client type and size.
Everything appeared to be going beautifully and it seemed as if nothing could possibly go wrong. But then it did – 2008 happened…
“It nearly buried us,” remembers Ade.
Halfway through the year they had lost a lot of money and rapid action was required. The firm became one of the first accountancy businesses in the UK to restructure; reducing headcount from 291 to 160 in 12 months. We needed to change fast and it was incredibly painful,” says Ade. “We lost some great people and it left a big cloud hanging over us for two years.”
So what went wrong? The lessons learned from this shockwave make interesting reading. Ade says: “We had previously taken the bold decision to walk away from large volumes of low level compliance work and focus on a value added advisory service to a focused client niche. This meant that the recession hit us hard. Our clients stopped buying consultancy whereas most of our competitors fell back on their volume compliance. In hindsight, we’d also overstretched and lost focus – that initial intensity had gone and we had got carried away in dabbling in too many disparate areas. We made the mistake of thinking that size was everything, chasing growth for growth’s sake and putting too much focus on business development and not enough on clients. We were too self-congratulatory and we took things for granted.”
But PKF Cooper Parry’s strong reaction to the turbulence proved to be telling. Its swift recognition of the gravity of the situation and its decisive restructure bought the firm time to reassess its strategy and move on quickly. It was first into the pits and first out. Ade says: “From all the soul searching and strategising that followed, we went back to our roots of the early 2000s but without the complacency, over-confidence and unshackled hunger. Before the recession we wanted to be a top 20 firm, but it wasn’t until later that we asked ourselves ‘why?’ We then realised that we didn’t have to win every fight but should instead focus on being number one in the areas where we were strong. That drove every decision we made for the next six years and we now employ over 400 people.”
Another reason why PKF Cooper Parry was able to react so quickly and positively to the downturn was due to its structure. From the mid-2000s the firm had been run as a corporate with a board focused on operational issues. That meant no committees, partner groups or votes, which led to agile decision-making – exactly what was needed to dig themselves out of the hole.
As the restructure was bedding in, the board set a new philosophy: ‘People first, strategy second’. “That was another a big switch,” says Ade. “The question we asked was ‘how do we look after our people better than we had done before?’ A lot of businesses put clients first, but we think that if you have happy, engaged, motivated people then they will automatically do great work for their clients.”
They believe that their mantra of ‘putting people first’ is the reason for their return to the prestigious Sunday Times 100 Best Companies to Work For list, which, crucially, is not decided by an anonymous group of judges, but by staff themselves who vote on their own firm and bosses. And more success has followed, with the business now the fastest-growing UK accountancy firm.
On the surface it may appear that PKF Cooper Parry – with its dress-down CEO, funky new office and belief in ‘Disrupting. Leading. Making Life count.’ – is rebellious and different for the sake of it. But that misses the point. This firm has been on an extraordinary 13-year journey to reach its current position and, far from being a marketing ploy, there is substance, logic and entrepreneurial drive behind the image. In fact, PKF Cooper Parry has been on a similar journey to many of its most entrepreneurial clients – a journey of dynamic growth with big ups and even bigger downs. It has been able to adapt to changes, embrace them, learn from mistakes and turn them into positives. Arguably, the biggest lesson that the recession taught them was not to chase growth for the sake of it but to focus instead on building a framework that allows you to naturally and seamlessly create growth. PKF Cooper Parry learned that vital lesson perfectly and responded equally well. The quality of that response is a big reason why the firm is rated so highly by its people today, why it is growing so fast (but this time in the right way), and why they are so well equipped to advise its owner-managed clients.
As we leave Ade at Sky View, we ask one final question. Why casual? Why the jeans? Why the whole rebellious image? He replies: “Why not? We can and we want to. It’s us, it feels right!”
Lack of innovation. Resistance to change. Poor communication. A trio that blights some professional services firms. In rebelling against all three, PKF Cooper Parry has cultivated a disruptive reputation. And like all disrupters, they make some traditionalists feel uncomfortable. But maybe, firms who are wedded to traditional methodology should forget about their comfort levels and ask themselves instead what they are doing to innovate, motivate and disrupt. Surely it is only by pushing the boundaries and doing something different that you can throw down the gauntlet and ultimately revolutionise an industry…