The title of this blog sounds like the plot of a “Jason Bourne” espionage thriller. But it’s not the plot of a movie. This actually happened on April 23 when the Associated Press’ Twitter handle was compromised and a tweet was posted saying that there had been two explosions at the White House and President Obama had been injured.
In two minutes, the New York Stock Exchange fell 140 points based on 140 characters.
As a CEO, I struggle with the fact that in just two minutes – and based on a single false tweet – our economic market was so significantly shaken. That’s the type of power and control that terrorists pursue – whether they employ a bomb or a computer to achieve it.
While I’m not a cyber security expert, I appreciate its critical importance to ParenteBeard as well as the larger business world, our economy and our national security. In the wake of this incident, I’ve had discussions with some very smart and dialed-in members of our team who focus on our corporate cyber security. Suffice to say, I find myself both scared and fascinated by the wide-ranging challenges we face.
But what I have found most enlightening is the near uniform response to the question, “Are we doing all that we can to prevent this from happening again?” Consistently, the answer has been no. And more consistently, the need for the Cyber Intelligence Sharing and Protection Act (CISPA) has been mentioned.
This bill, which would establish protocols and standards for online protection and encourages businesses to work together to prevent crippling cyber attacks, reflects a real national strategy. And while it’s been vetoed before, I’m hopeful it might be revisited by our legislators, especially in the wake of this incident. I think we can all agree that the safety of private industry, infrastructure, banking and consumer commerce is too important to leave open to such risk.
I would love to hear your thoughts on cyber security and CISPA. Are we doing enough? Too little? Is enough action being taken by Congress to thwart a cyber attack aimed at devastating our economy or breaching our national security? Let’s keep this conversation going.
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Recently, I was reading a profile of Paulett Eberhart, CEO of CDI, an engineering and staffing company in Philadelphia. In it she spoke to a variety of CEO-focused issues but there was one that really stood out to me: “Staying current.”
Being current – in a 24/7 media environment and beyond what we do every day – is a challenge. Many of us are on information overload. But it’s hard to argue that our conversations about what’s happening outside our offices aren’t as important as our conversations about work.
While it’s hard to keep up, here’s my approach. I read The New York Times, The Wall Street Journal, Financial Times, The Philadelphia Inquirer and South China Morning Post daily. The most important part of reading these papers (whether in print or online) though, is that I go beyond the business section. On any given day, I might read an article about leadership in arts and culture, a new approach to teaching and learning in inner-city schools or a delicate diplomatic issue.
These articles don’t have a thing to do with tax, accounting or business advisory. But each gives me different insights, which encourage me to be more rounded and even more curious. Maybe it’s a recommendation for how I can better lead or a stronger way for ParenteBeard to mentor new employees. Whatever it is, these articles are invaluable not only as conversation starters but also as tools to better connect with our clients. Even just sharing an interesting article with them demonstrates that we care deeply about our client relationships – and that we are always looking out for their business.
I’d enjoy hearing how you “stay current” in your own lives. Please feel free to share and maybe we can all pick up a trick or two.
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A guest blog post from John Nealon, our small business practice leader
Working with small business owners for most of my professional career, I’ve witnessed the daily pressure that coincides with managing a business. For many small business owners this anxiety peaks at tax filing time. That’s why we’ve launched the ParenteBeard Small Business Tax Toolkit, an online resource updated regularly with information to help small businesses get through tax time with fewer headaches.
Small businesses owners face an additional concern this year as the IRS is increasing the number of small business audits in an effort to close the $450 billion tax gap. This is why it’s critical for small businesses to be extremely diligent when filing and avoid any mistakes that could raise a red flag. And, the fiscal cliff deal presents a number of upcoming changes that small businesses need to be familiar with.
How can small business owners wade through 70,000 pages of tax code and find time to manage their business? Realistically, it’s not possible. We invite you to check out our Small Business Tax Toolkit to find all the information in one spot. The toolkit includes articles written by our team of tax professionals, weekly tax tips, industry surveys, tax jokes and relevant news articles.
We hope our toolkit offers small businesses everywhere some relief during this hectic time of year.
I appreciate that Bob gave me the opportunity to share this space and look forward to dropping in again soon.
“The longer I live, the more I realize the impact of attitude on life. Attitude, to me, is more important than facts. It is more important than the past, the education, the money, than circumstances, than failure, than successes, than what other people think or say or do. It is more important than appearance, giftedness or skill. It will make or break a company… a church… a home. The remarkable thing is we have a choice everyday regarding the attitude we will embrace for that day. We cannot change our past… we cannot change the fact that people will act in a certain way. We cannot change the inevitable. The only thing we can do is play on the one string we have, and that is our attitude. I am convinced that life is 10% what happens to me and 90% of how I react to it. And so it is with us … we are in charge of our attitude.” – Chuck Swindoll
I’m proud to work with a team of people who try to approach their work with a positive attitude in everything they do. At ParenteBeard, our core set of values – our COMPASS – guides our firm culture. We recognize our team members who exemplify these values and serve as role models for all of us. Recently, a team member who was nominated for a COMPASS Award sent me the above quote in response to her nomination, citing it as a source of inspiration for how she approaches not only her work, but life in general.
It’s emails like this and the interactions I have every day with team members that reinforce why I wake up each morning excited to push myself as the leader of the firm. Surprisingly, it’s the positive attitudes we bring every day that form the basis of the firm’s COMPASS values – not the other way around.
Tomorrow on your way in to work, consider a more positive attitude. A little change in your attitude can make an amazingly big difference in the entire culture of your workplace. Let me know how it changes your perspective, as well as that of those around you.
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As chairman and CEO at ParenteBeard, I am actively involved with Baker Tilly International, the world’s eighth largest network of independent accounting and business advisory firms, of which we are one. Serving as Chairman of Baker Tilly International’s North American Regional Council and on their international board allows me to travel the world and meet inspiring and innovative business advisors and business owners of all types.
I’ve sat across the table from countless business advisors like myself who relay to me the struggles and triumphs their clients have faced in building their own businesses. Many of their clients have moved on successfully. Others have retired without reaping the benefits of the hard work they put into their companies. Having spent decades guiding our firm’s expansion, I have a profound appreciation for what the success of one’s business and its continuation means to the owner. I know what it takes to keep your business in the Major Leagues both during your tenure and when you retire. Yet from what our partners and I hear, many business owners do not have a formal succession plan in place. In fact, some of the best and brightest have not even given it real thought.
Succession is about outcomes. It’s about guaranteeing a home run and preparing for curveballs. It’s ensuring you get what you want for your business, family and yourself. In the next decade, small businesses and middle market companies worldwide–worth trillions of dollars–will change hands as baby boomers pass their businesses on. I’ve seen it. I understand how this change can vary greatly between businesses and families. The smoothness of this transition depends on the owner’s willingness to plan and plan early.
We here, along with Baker Tilly, are committed to helping our family business and privately held clients plan successfully. Baker Tilly International has launched a succession planning research project that, with the help of business owners around the world, will allow us to understand, then overcome, the obstacles to sound exit planning. We invite you to participate in this landmark research project by taking 15 minutes to complete an online survey to share your knowledge and experience.
Before you know it, your turn at bat will be over and you’ll need to know who will be next to take a swing at running the business. You should have the best statistics to determine who that should be.
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I have fond memories of playing Monopoly as a child with my family. My favorite piece was always the battleship. As it turns out, even one of the most popular board games ever needs some updates.
Although there have been countless versions of Monopoly released over the years, with the game tracing its roots back to the turn of the 20th century, the tokens that come with the traditional deluxe set have remained remarkably consistent. The board game has impressively maintained its popularity over decades, striking a chord with generation after generation. However, some of these newer players have never seen or used the once common household objects offered as tokens.
In an effort to bring Monopoly into the 21st century, powerhouse toy company Hasbro recently announced a campaign where Monopoly fans will determine which classic game token will be retired and which new, contemporary piece will replace it. According to Hasbro, “in an unlucky roll of the dice, every Monopoly token has landed in jail. One will be locked up forever and replaced with a new piece.” Avid fans can vote once a day every day to save their favorite token and usher in a new one at apps.facebook.com/saveyourtoken. The new tokens include a robot, ring, cat, helicopter and guitar.
This campaign is another example of Hasbro adapting to the changing times and preferences of consumers. Clearly we’ve entered an age where family game nights have been replaced by apps on our phones and tablets. Rather than throw in the towel, Hasbro is adapting by continuing its strategic partnership with Electronic Arts (EA), allowing EA to create digital games based on Hasbro’s IP, including Monopoly.
I doubt the executives at Hasbro imagined 10 years ago that they would be partnering with a video game company to transform their iconic board game into a digital, handheld experience. But Hasbro’s willingness and ability to evolve its model, with a continuously open mind to different approaches and partnerships, has allowed it to remain successful and relevant. What’s more, the company is involving the consumer in the process. While the contest is hosted solely on Facebook, driving its page’s fan base to more than 10 million strong, it is leveraging it across all of their social media platforms to generate even more buzz.
Regardless of the campaign result, Hasbro has demonstrated how to continually evolve and adapt to the changing environments, trends and tastes of consumers. The campaign strengthened the Hasbro brand by evoking the strong emotional ties many of us have to a favorite childhood game.
Hasbro clearly isn’t the only company to rework its business strategy to adapt to a new generation. However, there are countless businesses that have simply created a presence on social media without gaining the benefits of truly engaging the consumer. The days of one-way conversations from a business to a customer have come and gone. Social media has created a two-way street of engagement and forced companies to rethink their business models and marketing strategies. Can you think of other companies like Hasbro that have been able to so seamlessly make the shift?
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Happy New Year!
Excited for the year ahead, I reflected on the flow of information from 2012. We have never moved faster, thanks to the complete ascendency of social media and technological advances. Many of us learned about the biggest happenings of 2012 through Twitter, Facebook or blogs, like Michael Phelps winning his historic 18th gold medal at the London Olympics, or the incredible rise of the viral sensation “Gangnam Style.” We saw social media giant Facebook go public and can now choose from more apps than we can keep track of. We now have platforms to voice immediate responses and engage in discussions, changing the way we regularly communicate.
In light of this changing landscape, this blog, which started out as more of a journal, is now completely interactive. Your feedback and questions are encouraged and integral to generating meaningful discussions and insights. Sometimes you have to step outside of your comfort zone in order to evolve, and although this is new to me, I am eager and ready to dive entirely into this blog.
Your suggestions and feedback will inspire my future posts. I’m positive 2013 will bring great things for our firm, starting with this interactive blog, the first of many changes we are making to better connect with our clients. From all of us at ParenteBeard, we would like to wish you a happy and prosperous New Year and encourage you to try something new, even if it’s not exactly in your comfort zone.
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This year I really intend to stick to my New Year’s resolutions. Everyone knows the end of the year is the perfect time to re-evaluate and look ahead, in both your professional and personal life. Keeping to our goals through the entire year can be difficult. But in this uncertain business climate heading into 2013, business leaders need to firmly commit to their resolutions and plans this year.
For many business owners, even developing those plans is fraught with fear and anxiety. Whether it’s because of ongoing economic uncertainty, the fiscal cliff or just general pressures, businesses large and small are trying to figure out the right plan. Here are some new twists on old resolutions that I’m offering to break out of the bottom line doldrums and experience a happier and more profitable new year.
- Lose Weight: Most businesses have already trimmed costs and reduced inefficiencies, but there may still be more to do. Do you have customers who don’t pay on time? A disgruntled worker who is hurting morale? Complaints about your systems, delivery or process? Pinpoint what is weighing you down and trim the fat. Lighter businesses will win in 2013.
- Quit Smoking: Clear the air with accurate and concise communication with investors, employees and customers. Face reality. Be more specific about finding a distinctive value proposition for your customers because chances are, it has changed over time. Create a clear, authentic and compelling sales story that represents the heart of your business and why you are unique.
- Nurture Friendships: Every business has certain centers of influence that can help with strategic advice, recruiting, networking and sales prospecting. Don’t wait for a yearly trade show. Connect with key contacts regularly through blogs, webinars, Facebook, LinkedIn, Twitter and other avenues. It is critical to take advantage of every networking opportunity. These touch points could lead to strategic partnerships and alliances that round out your value proposition.
- Read More: With more information available, it is more important than ever to stay current on industry trends. Don’t get bogged down by information overload. Start by creating helpful and immediate links to prioritize key sources and streamline your reading list. It’s as easy as setting up Google alerts and reading blogs from industry thought leaders. That way you won’t just be reading more — you’ll be getting more value.
- Get in Shape: Your quarterly revenues may be strong, but there may be some hidden hazards that could impact your long-term business health. It’s time to look at more than just sales figures and get into tip-top regulatory shape. Regulators are like doctors. Follow their instructions and your business will be healthier for it. Ignore them and you’ll be forced to deal with the consequences.
- Run a Marathon: Building a successful business is no longer a sprint, it’s a marathon. Do you have a succession plan? How about a plan for three, five and ten years down the line? Pace yourself so you’ll have enough in reserve for a strong kick at the tape. Many enter, but few will finish.
These are some resolutions that I’ve come up with, but I’m sure you can think of others that would help improve your business. My hope is that you and your company have a happy, healthy and profitable 2013.
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Some of you (likely the more seasoned readers or maybe the classic movie buffs out there) may remember the 1955 movie Rebel Without a Cause. The movie features a famous scene in which star James Dean’s character races another driver toward the cliff of an abyss. The first to jump out of his car to avoid going over the edge would be deemed a “chicken.” Sound familiar?
It probably should, as it is essentially what’s happening in Washington right now among politicians in their attempts to resolve the problem of the fiscal cliff. As we quickly approach the edge, politicians on both sides continue to reposition their stances and it’s clear that sizeable differences still remain. In essence, we’ve witnessed how the polarization of our political system has created a game of “chicken” with our economy.
What we’re faced with seems to be two sides speeding in separate cars towards the edge of the cliff, with the possibility of both driving off of it together. Instead of trying to outlast one another, the opposing sides need to realize that they aren’t driving different cars, but are rather sitting side by side in the same one. Despite all of the damaging economic ramifications of going over the fiscal cliff – a significant fiscal drag, markets diving, falling back into a recession, a global economic slowdown – there is an opportunity here for us as a nation.
As an accounting and business advisory firm, we’ve heard more than most about our clients’ fears. If a deal isn’t made in a timely manner, businesses will ultimately face the consequences. This is a chance for our political leaders to come together and show the country that compromise is still possible. Regardless of your politics, when it comes to driving towards the fiscal cliff, we’re all in that same black 1949 Mercury Club Coupe. No one will benefit from us kicking the can down the road and driving off the cliff.
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Last week we hosted our third annual Audit Committee Forum. This year’s program came from discussions with our clients, current industry trends and feedback from last year’s attendees. Our goal was to provide forward thinking and innovative ideas to enhance audit committees’ operations and provide attendees with the guidance necessary to be more effective.
We are committed to sharing valuable information – with our clients, colleagues, friends, the industries we serve and the CPA profession – so we’ve shared insights from the forum (http://www.parentebeard.com/auditcommitteeforum/) to inform and educate members of audit committees and boards of directors on the current best practices for businesses in this uncertain economy.
In today’s fast moving environment, risk management is critical for CEOs and boards. Regulatory authorities are constantly issuing new requirements that mandate more explicit information on risks and risk management practices. Combined with the heightened scrutiny brought on by recent negative headlines about well-known companies such as Groupon, Amazon, Google and, surprisingly, HP and Autonomy, boards and committees are feeling more pressure than ever before. These individuals now face the same scrutiny for failure to comply with expected standards and will be held just as accountable as the companies they serve.
The interplay of the various risk and compliance requirements forces companies to go beyond managing risk in silos and create an integrated risk management function. In other words, instead of wearing just one hat in a particular area of expertise like marketing or finance, members of an audit committee are forced to wear many hats. The issues are all connected.
While risk can never be eliminated, companies that move beyond traditional risk management to implement more comprehensive enterprise risk management strategies will be in a much better position to prevent, minimize or recover from losses in shareholder value.
It’s time for committee members to remove their individual hats, whether financial, marketing, management, or other, and consider different ways of thinking.
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