While some Baby Boomers are starting to retire, there are many that are still filling upper management positions. As more and more Millennials graduate and settle into their careers, they are bringing different outlooks on life to the workforce. These two generations working together highlight the differences between Baby Boomer bosses and Millennial employees that can stir up conflict.
Baby Boomers have a distinct mentality about work and their positions within their organizations. Many Baby Boomers have an ambitious work ethic that can appear to a Millennial to be a workaholic attitude or a “live to work” attitude. Baby Boomers are also very loyal to the organizations that they work in, more so than their subsequent generations. This loyalty is beneficial because organizations require Baby Boomers to provide their vast array of experience, knowledge, and ethical leadership. However, with their work ethic and experience, Baby Boomers can get critical of, or frustrated with, those who do not share their same attitudes and qualities regarding work.
The fact of the matter is that Millennials have a different attitude surrounding work and how it fits into the grand scheme of life. First off, Millennials prefer to have a work-life balance that accommodates their pursuits of personal hobbies or interests. This attitude of “working to live” can come across as lazy to their bosses. Second, Millennials tend to want more frequent, open communication and feedback from their supervisors than preceding generations have. Supervisors may see this desire for more positive support as burdensome. Also, the Millennials’ inclination to want to talk about everything, even information that is more sensitive or reserved for senior management can be taken as a sign of disrespect. Third, unlike the Baby Boomers who are loyal to the company, Millennials are usually more loyal to an individual or supervisor that they admire. This creates a willingness to leave if the supervisor moves on or no longer works with them on a frequent basis.
Although all of the above Millennial traits can strain relationships with Baby Boomer bosses, Millennials bring some great qualities to an organization. First, Millennials are more accepting of diversity which leads to better communication and the ability to work in groups. Second, they have unique perspectives and can be a great asset when trying to solve problems. Lastly, they have grown up surrounded by technology. Millennials are great at mastering new technologies as they emerge. Organizations can use the unique attributes of both the Baby Boomers and Millennials to minimize the risk of clashing viewpoints.
There are three great ways a company or an organization can satisfy the new attitudes of Millennials while preserving the great qualities of Baby Boomers. First, organizations can encourage communication and problem solving by creating a more open work environment. This can be done through on-boarding processes with new hires to help assimilate them into an organization’s culture. Also, continued socialization after the on-boarding process fulfills the communication desire of Millennials while decreasing the differences that Baby Boomers’ perceive (Anderson, Baur, Griffith & Buckley, 2017). Second, when organizations are willing to add some flexibility into their structure they are likely to see many advantages in relation to their employees such as lower turnover, higher job satisfaction, and greater synergy with Millennials (Myers & Sadaghiani, 2010). Lastly, organizations can build on the technological savvy of Millennials by using the idea of reverse mentoring. Reverse mentoring is the idea of pairing a Millennial with a Baby Boomer to help the Baby Boomer learn how to more efficiently use the technology within the organization. This creates a sense of importance and positive interaction for the Millennial while at the same time allowing the Baby Boomer to teach the Millennial more about how the organization works and what is expected.
At the end of the day, whether you are a Baby Boomer or a Millennial, we should all be thankful because we help define each other, build off of each other’s strengths, and fill in each other’s areas of weakness to create well-rounded organizations and communities. We need to learn how to interact with the purpose of understanding our differences instead of criticizing them.
Anderson, H. J., Baur, J. E., Griffith, J. A., & Buckley, M. R. (2017). What works for you may not work for (Gen)Me: Limitations of present leadership theories for the new generation. The Leadership Quarterly,28(1), 245-260. Retrieved from https://doi.org/10.1016/j.leaqua.2016.08.001.
Myers, K. K., & Sadaghiani, K. (2010). Millennials in the Workplace: A Communication Perspective on Millennials’ Organizational Relationships and Performance. Journal of Business and Psychology,25, 225-238. doi:10.1007/s10869-010-9172-7
Staci White, CPA, is an accountant for Howard, Cunningham, Houchin, & Turner, LLP in Lubbock, Texas. She is a member of the South Plains Chapter and currently serves on the TSCPA Board of Directors.
The Texas Society of CPAs (TSCPA) held its Annual Meeting of Members recently. In addition to taking care of important business, attendees got to hear from great speakers on several topics including fraud, leadership, being yourself, and changes impacting the profession. Membership declines continue, although at a reduced rate of one percent. Changes in membership are occurring, and it was noted that the TSCPA Board of Directors now has more members in their thirties than in their sixties. The Society is solid financially with strong reserves, although the CPE Foundation continues to show strains as the way CPAs obtain continuing education changes.
Two important task forces are beginning work including one on chapters and one on the TSCPA brand. The chapter task force will be focusing on integrating technology and leveraging resources among the chapters and the state; while the brand task force will be focusing on a unified approach including our visual identity, brand standards, and leveraging existing relationships with faculty to expand student and candidate outreach.
If you ever wondered how all that money donated to benevolent funds, political action committees (PACs) and the Accounting Education Foundation (AEF) is handled, you found out at the annual meeting. In addition to all the work TSCPA and chapters did to help members who suffered through Hurricane Harvey last year, the AICPA Benevolent Fund provided over $600,000 in support to members in Texas. The TSCPA CPA-PAC will spend over $400,000 in support of candidates in 2018; but as big as that number sounds, it dwarfs in comparison to many other PACs when you consider the TSCPA CPA-PAC was ranked 152 in campaign contributions in the 2016 election year. Finally, the AEF was able to raise money to set up a $75,000 scholarship fund to provide the Bob Owen scholarship to promising accounting students in perpetuity. Bob Owen was a great leader and contributor to the CPA profession in Texas for decades; and while he will be missed, he will also now always be remembered.
The meeting ended with a substantive question and answer session. Technology allowed attendees to submit questions online, and then other attendees could vote up the questions they felt were the most important and should be addressed. Questions about Peer Review, the PCAOB, getting information to members, and how to become more active in committees and task forces were addressed.
If you missed the annual meeting you missed a lot of great information. In future blogs I will provide you a little more information on topics a couple of our speakers addressed during the meeting.
The Fourth of July brings back many fond memories – cookouts, canoeing, softball, volleyball; but most of all watching fireworks. Fireworks shows can often be like people you work with. Here are a few to consider.
The amateur – the fireworks go up one at a time with lots of time in between just like the work accomplished by new people on the team.
The skipper – the fireworks show is moving along, and then inexplicably the fireworks stop for a few moments, only to begin again; just like the person at work who seems to suddenly disappear then comes back performing work like their absence didn’t really occur.
The teaser – these shows have a good pace; and then you think you have a finale, but not really as the fireworks continue just like the person at work who turns in an assignment but then tells you they still have work to complete.
The complete package – the show has a good pace; the volume builds and subsides several times, but never stops and the ending has everything you could want just like the best professionals I get to work with every day.
I hope you have a great Fourth of July, and I hope the fireworks, and your team, are the complete package.
There is an old saying that goes “before engaging your mouth, first ensure that your brain is in gear.” I think the modern variant to the saying should be “before engaging your keyboard, first ensure your brain is in gear.” Both variants of the quotes have been ignored a lot recently, usually to the chagrin of those who failed to ensure their brain was in gear. People are losing respect, jobs and potential future earnings, to varying degrees, due to statements that are quickly rescinded. I have three ideas to keep you from joining the ever-growing crowd of those who wished they had not tweeted something.
- Never send an email, tweet or other written post when you are angry.
- Unless a quick response is life or death, sleep on your reply to any controversial subject before you hit send.
- Ask someone else to review your response before you hit send.
If you are angry, your brain is highly likely not to be fully engaged. Road rage is a perfect example of what I mean. People suffering from road rage are not thinking about anything but getting revenge. They aren’t thinking about safely operating an automobile; they aren’t thinking about the bad outcomes that could affect them like a wrecked car or a further delay in getting to their destination. Anger blinds you to full comprehension of the implications as much as being drunk or under the influence of some other legal or illegal substance. If you must respond quickly, at least take a few minutes to walk around, let off steam and think about something else. Just stewing on the issue for 15 minutes and getting angrier is not what I mean. Until you actually “forget” about the topic for at least a few seconds, you won’t be able to get past the anger and look at your response comprehensively with a clear mind.
Life or death responses are so rare, many of us will only have a handful of such situations occur in our lifetimes. Sure, if you are a 911 operator or a doctor helping with an operation over the internet, you can’t “sleep on your response,” the rest of us can. I can’t count the number of times I wrote and revised emails but decided to leave the reply until the next day, only to realize the next morning how harsh the email was and how much better I could have written my reply. In today’s fast paced world where people are hyper concerned about speed rather than quality, we often lose touch that people can usually wait until the next day for a reply with no harm whatsoever. You may not be the person with the most tweets, but maybe you could become EF Hutton – the person people stop to listen to when you do say something.
My final piece of advice is to have someone review your response before you send it. Writers have an editor for a reason. The editor brings a different perspective and a fresh look at the writing. That means the person you go to can’t be someone who is just going to egg you on. You need someone who is willing to challenge you from time to time, as well as, someone who has a different, not opposite, but different, perspective than you do on several subjects. That person can be a peer, a boss or a strong subordinate, and can be several different people depending on the subject.
One final thought. People forget that the written word, and today with video recorders in every pocket, the spoken word is forever. Thinking – engaging your brain – before speaking or writing is not a sign of weakness. Thinking is a sign of intelligence and compassion, and don’t we need more of both today?
How to Ensure an Effective Exit Strategy for Private Company Owners by Guest Blogger Janae Chamblee, CPA, BCB, CBIPosted: June 18, 2018
Selling a company is three parts art, seven parts science with a little sprinkle of luck, but it is 100 percent process oriented. It is critical to begin with strategic planning to posture the company in its best operational and financial light. Sellers commonly fail to consider exit strategies when things are going well for their company, and tend not to focus on an exit strategy or transfer process until an unforeseen external event triggers an awakening or they decide to retire or reach burn-out. Knowledgeable sellers understand that to exert control over internal forces (employees, accounting and operational processes) and external forces (economic turbulence, industry downturn, changing competition, illness, etc.) they must clearly examine all aspects of their business, define their personal goals and objectives, and begin exit preparation yesterday. A transaction has three characters; a seller, a buyer and a financing source. Sellers should take a critical look at their company from the prospective buyer’s or lender’s viewpoint. If sellers manage their company with an “End in Mind” decision-making outlook, then they will always be in a continuous process of preparing their company for sale.
Seller’s Goals and Objectives
How do sellers begin to define their goals and objectives? Sellers must delineate specific objectives for financial goals (liquidity, sale price, taxation/estate planning) and non-financial goals (succession, legacy and reputation, employee, stakeholder concerns and other special interests). Decision-making questions include: To whom do I want to sell/transfer the business (family, financial investors or competitors)? How long, post-closing, do I want to be involved? Do I want to accept some upside/risk? Are there employees or others whom I want to protect/reward? What is my after-sale tax position? What are my financial alternatives post closings?
Assemble and Communicate with Trusted Advisor Professionals
Sellers should not try planning their exit strategy alone. Running a company is a full-time job. Sellers shouldn’t take their eye of the ball. Sellers should assemble their advisory team early in the exit-strategy planning process and clearly communicate their exit goals and objectives. Sellers must listen to their advisors’ advice, understand their options and implement the agreed upon suggestions. Advisors who must be in position early in the planning process include: certified public accountant, transactional attorney, financial advisor, merger and acquisition advisor.
Market Value and Transaction Structuring Alternatives
A prerequisite of a comprehensive exit plan is to understand the current market value range of the company. A comparison of market value to the seller’s financial objectives will indicate if the right time to exit is now. If market value is too low a seller needs to contemplate how they will increase their company’s value. Deal structuring, tax structuring and financial engineering can significantly impact the seller’s transactional proceeds. Sellers that understand the implications of transaction structuring alternatives will be prepared when they elect to take their company to market.
Influence Value — Develop Credible Financial and Operational Projections
“Buyers analyze the past but buy the future”. A persuasive growth strategy is a key element of exit planning. In a sale, to maximize the transactional value of a company, sellers must provide potential buyers with a compelling story of future growth opportunities and profitability. Sellers should develop a credible set of detailed financial projections and key operational drivers for the next three to five years which will, in part, define the buyer’s perception of the company’s future and management’s ability to deliver.
A Company’s Financial Profile Via a Buyer’s/Lender’s Perspective
Owners should let their CPA perform the heavy lifting but having a thorough personal knowledge of the company’s financial performance is sage advice when preparing to sell your company. Buyers will want a transparent understanding of the target company’s historical performance. It is best to have three years of audited financial statements plus interim year-to-date financials. Very clean, compiled/reviewed statements with their accompanying tax returns will suffice in some cases. The validation of the “the numbers” via audited financials will engender confidence with the buyer. Accurate historical financial information will allow the buyer to focus on the future with a better understanding of the risks and rewards associated with their potential acquisition. Sellers and their CPAs should focus on:
- Evaluating the company’s current corporate structure.
- Eliminating personal expenses and over generous benefits to friends and family.
- Cleaning up the balance sheet by:
- Selling excess or non-producing assets;
- Recognizing all on and off-balance sheet liabilities such as customer prepayments, work in process billings, warranty obligations etc. openly; and
- Taking any necessary “write downs” for uncollectable accounts receivable (A/R) or unusable inventory.
- Eliminating any unrelated “side” activities intermixed with the company.
- Maintaining an accurate inventory and current inventory value.
- Understanding the company’s key performance indicators and how they compare in the industry.
- Improving the quality of earnings.
A Company’s Operational Profile Via a Buyer’s/Lender’s Perspective
Buyers will spotlight the key operational drivers of the target company. A seller should review and be prepared to give accurate details regarding the prior, current and future status of the:
- Size of the Company
- Location of the Company
- History of the Company
- Management of the Company
- Employee Resources
- Barriers to Entry
- Manufacturing Processes
- Market Share
- Client Base
- Business Growth
- Pricing Policy
- Inventory Levels
Owners who have prepared their exit strategy will begin the marketing of their company in a position of strength. Clear goals and objectives will place the seller in the optimal position to negotiate favorable price and terms, or, if necessary, to walk away.
Janae Chamblee, CPA, BCB, CBI, is a Director of the TSCPA and the Dallas CPA Society. As the owner of First Business Resources, Inc.*, a merger and acquisition services company, Janae has twenty years of experience in providing hands-on guidance to her clients in helping them buy or sell their company.
*This firm is not a CPA firm.
The FASB is in the process of issuing an important amendment to the leasing standard that public companies must adopt in 2019. (Private companies get one more year and must adopt in 2020.) The change will allow companies to defer the date of initial application of the standard to the date of adoption. The change is optional. That is, companies could decide to not change the date of initial application and follow the requirement of the initial standard to use the date of the earliest financial results presented as the date of initial application of the standard.
What does the change really do?
The change in when the standard is applied impacts the historical comparative periods presented in the financial statements. The option is like the modified retrospective option in the revenue standard in that it would not require the restatement of prior periods. An example would probably help you understand the impact. Assume a public company enters into a five-year lease at $100 a year on January 1, 2016. Under the initial lease standard, the company would have to restate its 2017 and 2018 financial results to reflect the new leasing standard. Under the new option, a company would not have to restate the 2017 and 2018 financial results, but instead would just reflect the changes in the 2019 financial results.
The option would, at first glance, appear to be a no brainer to use because the work needed to adopt the standard would be reduced. Any leases that expired before January 1, 2019 would not need to be included in the adoption work effort and there would be two years less data to have to get re-audited. These are good benefits, but there are some implications that need to be considered.
The first implication is lack of comparable information. Will your investors be satisfied with not providing comparable information, or will they ask for comparable results anyway? Many companies may think that this is a balance sheet only exercise and because the income statement impacts for operating leases are not really changing, there isn’t much of a comparability issue. That is true unless you have changes that do impact the income statement, such as deferred gains on sale-leaseback transactions, that will disappear under the new standard and potentially significantly increase your lease rent expense.
The second implication is a little less obvious, but one that should be considered. Because the standard requires that the lease term on all existing leases be considered to start as of the date of initial application, the option to delay the date of initial application has the impact of effectively shortening all the lease terms on existing leases. A shorter lease term will result in a lower discount rate, resulting in a higher present value of the remaining lease liability.
Whether or not such differences matter will be up to company management, but the point is that implementing the option has implications beyond just the adoption work. The decision to elect the option should therefore be subject to at least a high-level analysis of the differences, rather than simply made in a vacuum, by the team working on implementing the new standard. In the end, I believe most companies will likely elect the option to not restate prior periods. The reduction in work to implement the standard is too compelling, but I will be interested to see which companies don’t make the election and, more importantly, why they don’t. That is, if they are willing to share such information.
Shohei Ohtani is taking Major League Baseball by storm. If you don’t know the name, Ohtani is a rising star from Japan making a big splash. He is a pitcher whose team has won six of his seven starts (his official record is 4-1) and strikes out more than one batter an inning on average; and a hitter whose batting average is over .300 that hits with power. When he isn’t pitching, he is the designated hitter for his club the Los Angeles Angels. On the one hand, everyone is acting as if this is the first time anyone has ever done such a thing, which at the major league level is mostly true. The difference is that if you go back to little league and even high school, usually the pitchers are the best players, including the best hitters, on the team. It’s only when the player becomes a professional baseball player that he (and for now every major league player is a he) specializes and become either a hitter or a pitcher.
A similar process happens in the accounting profession. Most start off as one of the best and brightest students in high school, but over time they specialize in tax, audit, managerial accounting or any of several areas; and people seem to forget that most accountants come with a keen analytical mind which is perfect for adapting to the data analysis world we now live in. Professional accountants have been steeped in data analytics for decades, but somehow people seem shocked that accountants are knowledgeable about such a “new” area. The only thing new about data analytics is the volume of data and the computing power to analyze it all. The concept of looking at data to make better decisions has been around at least as long as the accounting profession.
Accounting work is already dependent on several specializations such as tax and valuation work. Now we are adding data analysis to that list. Will the addition change the profession? Yes. But this isn’t so much a revolution as a continued evolution on the path we have been on for the past several decades. Those entering the profession today are like the high school baseball stars that can pitch and hit. Many wanting to become professionals understand accounting and data analytics. Some may decide to specialize in the new area of data analytics, which to those outside the profession may seem like something other than accounting. But I think the real answer is that these data analysts will be embraced by and become part of the profession because, in the end, it’s not specific skills, but a desire to help and serve the public interest that already binds the accounting profession together today.