BeansTalk
BeansTalk: Where Expertise Meets Opportunity, Mauldin & Jenkins' podcast, where we are sharing and showcasing our areas of expertise through conversations with practice leaders on their knowledge and experience.
BeansTalk
Mastering the Balance: Strategy, Scaling, and Women in Leadership
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Celebrate Women’s History Month with Kristen Lord as she reveals why financial literacy is the ultimate tool for empowerment in leadership. We discuss the tactical "green lights" for business expansion and how to survive the operational shifts that come with rapid growth. Stay tuned for an honest look at the essential advice Kristen would give her younger self to navigate the intersection of finance, growth, and leadership.
About our guest
Kristen Lord, CPA, is the Chief Operating Officer of Mauldin & Jenkins, LLC. Kristen joined Mauldin & Jenkins in 2006, and focused her career on audits of financial institutions before transitioning to the COO role. Kristen was a 2017 Cobb Young Professionals Next Generation Award nominee and a 2016 Georgia Southern University Alumni 40 Under 40 award recipient. Kristen is a member of Cobb Executive Women and the CPA Firm Management Association. Learn more about Kristen and her expertise here.
About our host
Brandon Smith, CPA, is a Partner based in the Atlanta office and the Advisory Practice Leader. Learn more about Brandon and his expertise here.
Learn more about our firm here.
Introduction
Speaker 01Welcome to BeansTalk, M&J's podcast where we are sharing and showcasing our areas of expertise through conversations with practice leaders on their knowledge and experience. As business leaders, we all want to see our revenue charts go up and to the right. But there's a massive difference between a business that is just simply growing in revenue versus one that is actually scaling. During periods of growth, that's when many companies break, operational systems fail, or cash flow dries up, and that can even be as revenues are increasing. For today's episode, I'm very excited to be joined by the COO of Mauldin & Jenkins, a rapidly growing firm to help navigate growing and scaling businesses. COO is Kristen Lord. And Kristen, thank you so much for joining me.
Speaker 02Thanks for having me, Brandon. Excited to be here today.
Speaker 01So, Kristen, you know, I'm really excited and hyped to talk to you today about just growing businesses and not just growing revenue, but also properly scaling our operations. But before we really dive in, will you do a favor for our audience and just kind of give a brief description of your background and your role at Mauldin & Jenkins?
Navigating Geographic Expansion and Mergers
Speaker 02So I have been with the firm for 19 years. I started with Mauldin & Jenkins right out of college and focused on auditing financial institutions, credit unions, and other financial services organizations. In 2012, I had the opportunity to move to our internal operations side and become the chief financial officer. And so within that role, I was responsible for financial reporting, budgeting, internal accounting, payroll and benefits. And then about a year and a half ago, transitioned to the chief operating officer role, which just expanded the position to include some other operational organizations within the firm.
Speaker 01And that's you have that really interesting and comprehensive view from going from that auditor and CPA lens up through, as you described, the CFO of the firm, and then the operation side, from the technical to the strategic. So it's just I'm really happy for you for uh you making the time to talk to me today. Thank you so much. And and I also it's a it's a really great time to talk because I know Mauldin & Jenkins has recently did a large expansion uh out west. So we just talked to me a little bit too about when it comes to a growing business, what scaling looks like. You know, what were some of the main things that you had to navigate at Mauldin & Jenkins uh as a business leader, kind of moving into a new geography and adding, you know, a lot more revenue and also even more headcount.
Speaker 02Sure. When we're evaluating our growth goals, you know, there's several different ways to attack it. You can evaluate growth and do it organically. You know, you can add you know new services to clients that you're currently serving and markets that you're already serving. You can expand your services that you provide, or you can expand geographically. So we have decided uh just recently with this new uh acquisition we've recently done is to expand into new markets out west.
Speaker 01And and when you're looking at an expansion like that, I know that the headcount just has a drastic increase sort of overnight. So what are some of the key operational things that you keep top of mind? I guess what are some of the systems that you're you're most concerned about that might break?
Speaker 02Oh, that might break. Oh my goodness. Um well, I think we have tried to do a really good job of streamlining a lot of our processes. You know, we utilize a lot of automation and technology, which is a huge help because in all honesty, sometimes the the people part of a process is what can sometimes break per se a little quicker. You know, people get um they can be overwhelmed, they can, you know, start to, you know, move out of the way of what our uh strategic ideas might be, they might not follow policy. So really just leaning on the infrastructure that we've built in terms of automation and um streamline our process.
Speaker 01Because it's a lot of change for for people, you know, on both sides of an expansion like that in terms of having new folks are working with in a new territory, and also the folks in that territory working, you know, oftentimes with with a with a new firm that they're merging in with. You know, uh HR systems are changing, billing systems are changing, a lot of that kind of stuff. So I love that you kind of point to kind of having that stable posture first of the good systems to be merged into, and then also the automation where appropriate. Now, now I guess when you're kind of having the view that these are things we need to keep top of mind, and they are things that could potentially cause issues if they're not running smoothly, that kind of makes me think, too, just before you make a decision like this, is there anything that you're keeping a close eye on before doing an expansion like this? You know, kind of you know, financial green lights, I guess I'd call them.
Speaker 02We always evaluate the culture of the other organization. We evaluate their risk tolerance, but you know, one of the biggest pieces is the financial metrics and how will the two merge together? Um, you know, we evaluate our uh KPIs in terms and look at theirs and make sure that they're, you know, they may not necessarily be the same, but can they get close? Are there things that Mauldin & Jenkins can approve upon that, you know, that the other firm uh may be doing a great job as, and and vice versa.
Speaker 01Yeah, I love that you you mentioned culture. You know, this isn't it's funny because I even framed the question, you know, financial green lights. My brain, just the CPA and my DNA go straight to like, oh, what are the financial things we pay attention to? But I think you're spot on that. Well, start with culture, and then from there, that culture drives how are we looking at our business, how are we measuring our business, how are we growing our business, and is there alignment there, you know? And it's not just that there's one way to measure and monitor and run a business, you know, and like it's our way or the highway, it's also taking some pages out of their playbook, too.
Speaker 02Absolutely.
Speaker 01So I I love that. Now, I guess too, there's a a lot that goes on when it comes to expansion and expansion through uh a merger like this. You know, you know, I guess how do you kind of distinguish between this the good chaos of growth and then just kind of like the, oh no, our systems are being stretched. You know, maybe we're kind of hitting almost a point to where something needs to be scaled up a little bit more. You know, is that something that you feel like you gotta kind of keep a pulse on? And if so, how?
Speaker 02Oh, absolutely. Um, during times of growth, it is so important to make sure that you're scaling your operations efficiently and effectively. You know, it's really easy when you know there's revenue growth, there's demand for your services or products to just, you know, add, add, add. But you don't necessarily want to just do more with more. You know, you you know, a company needs to make sure they're evaluating their infrastructure and their resources, whether that be personnel, occupancy, technology, of course, is huge, you know, and just insurance administration, you know, just making sure that people in the leadership team really has their hand on a pulse of what can they do with what they have and how best to structure that in the future for growth.
Speaker 01And so while we're kind of you know just thinking about things that can kind of you know pull on cash as we're growing, just do you have any kind of you know best practices or recommendations for how to manage and monitor cash during periods of growth?
Speaker 02Sure. So we review our cash position report every single day. Um, you know, it's a big part of our operations is where do we where do we stand with our cash position? You know, some important ways to manage and monitor it is budgeting and forecasting. You know, refer to your budget. Are you following your plan when you're looking at forecasting, what's happened in the past or what is going to change that you want to make sure you're planning for? Um but in there are a few operational ways to manage cash. You can accelerate your accounts receivable. You know, is that billing earlier, billing you know, more frequently, managing the billing process? There's also, you know, managing your payables process. Look at those invoices that come in and say, you know, are they net terms 30? Can you stretch them a little bit if you're really trying to manage your cash? And then also evaluate your infrastructure and resources. Look at what you have internally, look at your operating expenses, and see if there's some tweaks you can make that help you manage your cash.
Speaker 01Well, and those are all good things for us to monitor and and and keep an eye on and manage to, but also maybe forecast out before we even get ourselves into a growth phase. So it's not like all of a sudden we're growing and we need to be monitoring all this stuff, uh, but kind of keep it keep tabs on it and and look look ahead toward it. And from that lens, too, I guess, before we really push ourselves into a period of growth, you know, are there any kind of financial green lights that you keep in mind of like, okay, yes, we're ready for to push the accelerator a little bit?
Speaker 02That's right. Well, positive cash flow is an important piece to that puzzle because you want to make sure that you can afford any projects or any investments that you're making. Um, look in whether you're gonna fund something through retained earnings, through internal operations of the firm, whether you want to take on some debt, or whether you want to have a capital contribution from your owners. So there's a couple of different ways you can ways you can look at that.
Speaker 01And and what you're saying kind of makes me think too, just when it comes to kind of fundamentals of business, you know, things like economies of scale and economies of scope. You know, as we are scaling our business, we do benefit from economy of scale that kind of conceptually we can do more with less, you know, in some ways, have efficiencies in the infrastructure, but that infrastructure does still need to grow. It's not doing more with the exact same infrastructure we had previously. So all the things we're just talking about, that makes total sense, you know, even down to the technology systems that we have. So can you talk to me a little bit more about just like infrastructure and how you navigate that?
Speaker 02So really knowing the limits of and leveraging your existing system is key. You know, you don't want to necessarily push it to the max, but you want to make sure you can understand and fully utilize it to capacity so you're not doing more with more, like I mentioned before. Um, you know, it's easy to make quick decisions and panic decisions when you're in growth mode because you know you feel like there's a lot come through the pipeline, but you know, really taking the time, doing an evaluation and understanding um, you know, your infrastructure is key. You know, scaling operations efficiently and effectively sets up a company so revenue growth increases faster than operating expenses. And that's important. And Mauldin & Jenkins, you know, looks at that metric at least monthly because we want to ensure that our revenue growth is changing at a higher rate than our operating expenses, because that's how you manage your margin.
KPIs for Monitoring Growth and Margins
Speaker 01Well, and at the end of the day, you know, margins is kind of what it's all about, right? In terms of our capital investments, you know, put putting forth capital, whether it's the owner capital or you know, any different sources of capital, is to have a scaling business for the margin. So talk me through a little bit more when it comes to kind of from a month-to-month perspective, trying to have those lenses of monitoring the business. What are some KPIs that you know might translate to businesses generally or even just professional services that are oftentimes important things that you keep an eye on?
Speaker 02Sure, absolutely. So we had mentioned our gross profit, which of course is revenue less cost to produce that profit, uh, net profit, which is includes all other operating and other expenses. Um those are two that of course we we study monthly. Um we also look at our budget to actual comparisons. We want to make sure that our budgeted projections that we're still on target with those. And if we're not, do we need to adjust our activity, whether it be our revenue, you know, monitoring that or you know, managing our expenses? Um We're gonna talk a little bit about cash. You know, obviously managing or monitoring cash is a huge KPI that we look at, that cash conversion cycle of how quickly we bill our clients, get collections so we can fund our projects and our operating expenses.
Speaker 01Now I guess I'm just curious, too, from your your perspective, just your your overarching background of you know the technical side of the CPA, the auditor, the CFO, now the COO focus on operations and strategy. Just what are some of important trends from your perspective? What are things kind of looking forward strategically and just kind of you know where business is going, where the economy is going, where professional service is going, where the accounting profession is going? Just kind of what are what are things top of mind for Kristen?
Speaker 02No, that's a great question. So we definitely keep our you know finger on the pulse in terms of what's changing in the profession. You know, there's a lot of discussion about what the requirements are to become licensed, and we want to make sure that we're keeping and you know fostering a good strong pipeline of those that are in the CPA profession. That's important for us to keep keep everything moving forward. Um, we also really focus and do a lot of um studies and trainings with IT. I mean, obviously, AI is huge right now, and so you know, Mauldin & Jenkins has various committees and different task force that are really looking into how we can use AI with, of course, keeping a human in the loop, very important, um, but taking advantage of the resources that we have available to us and that are out there so we can better serve our clients.
Speaker 01Well, and on the realm of technology, I know uh people who listen to this podcast series a lot know that Brandon loves technology, and then I'm always trying to find ways to solve problems with technology and and also constantly ask ourselves, are we relevant? Is our business relevant? And oftentimes how are we you know using technology as a strategic differentiator to make sure make sure we're monitoring our relevancy. But the the truth too is that that technology is not always cheap. So we have to be mindful and strategic of that spend too, right?
Speaker 02Yeah, but you know, it is so important. And you know, we're able to do things now with technology that we could only dream of. So we have to be able to use it and leverage it to have you know our benefit.
Speaker 01And and and and too, when it comes to the data governance, something we're we're keeping an eye on, just doing it securely.
Speaker 02Absolutely.
Speaker 01Well, I guess from that sense too, just think about IT security, you know, from an operations perspective, you know, having IT within your, you know, kind of realm. Um, is that something that you have a close eye on and pay close attention to in terms of just what are different security threats that are out there and then how is the firm helping to make sure they're navigating those?
Speaker 02Oh yes. I mean, there's probably not a day that goes by that I don't think somehow about security, IT security risks, and you know, and what's what's out there. Uh we work really closely with our internal technology team. Um, you know, our firm does a great job of sharing information with our employees related to what could happen, what they're seeing, you know, out in the world. But I think we really keep technology and security top of mind.
Multimodal Communication: Scaling Culture and Clarity
Speaker 01And and just in this world of lots of change, change from the perspective of our technology, change from the perspective of just how our operating models are evolving, change from the perspective of growth like we've been talking about, you know, it kind of makes me start thinking about communication. You know, how communication for organization when we were three, four, five hundred employees is different at seven, eight hundred plus employees. So, from an operations perspective, I guess how do you how do you view communications? You know, like how have your communication strategies had to evolve? Have your interdepartmental relationships had to evolve? I guess what does communication look like as you grow?
Speaker 02I think we have to always remember people consume communication differently. You know, for some folks, an email will suffice. Some people prefer a podcast, you know, some like recorded videos, um, you know, live trainings. So there's different ways for people to, you know, absorb their communication, and we try to provide different methods, you know, to make sure that we're covering everyone, whether it's a newsletter or you know, an email or some sort of live training.
Sustainable Scaling: Capacity Management and Resource Optimization
Speaker 01Well, and and that's something, you know, I even me with my teams, I'm always just saying, like, I don't care how you communicate with me, whether it's a phone call, a text message, an email, a G- chat, a teams message, whatever it could be, just communicate. You know, but definitely when you when you elevate that to the firm at large with a lot of different people, a lot of different messages that need to go out. I I can understand how it's important to kind of meet people where they are and ensure that the messaging is to them, the training is to them, the videos are to them, the communication is coming out. And and and I I do kind of wonder too, when it comes to just scaling and growing and being concerned about things that can kind of break down and hit breaking points, that communication is one of those. I guess, you know, when when you when it comes to your you know operational lens of just keeping uh keeping an eye on systems that have been working well but are now kind of potentially reaching breaking points, is is communication something to keep an eye on? I guess what are what are other things that you always have to kind of monitor to make sure aren't breaking down or reaching a breaking point?
Speaker 02People don't get a handbook on what to do when you're successfully growing a business. So I think it's so important to make sure, you know, you're keeping a pulse on your people and your communication. Management can clearly identify when a software change is needed, when an occupancy change is needed, you know, when you're meeting capacity. But you know, getting people to manage growth is very important to make sure that they're keeping up with our internal policies, our strategic direction, um, that they're not overworked or overwhelmed. So just you know, keeping up with communication to make sure that our people are um successful.
Speaker 01And you know, thinking about capacity makes me, you know, you just not long ago I just made a joke about somebody like me, you know, in the professional service aside, you know, kind of almost wanting to uh hire before their revenue, prepare for growth, be postured for growth, you know, and you from looking at that firm-wide perspective from a capacity level, you know, just just during scaling, you know, how do you handle like resource management? How do you how do you handle and look at capacity, especially in your seat where you're you're helping manage multiple different departments with multiple different objectives? You know, I guess how how do you tackle that during periods of growth?
Speaker 02Sure. Well, in terms of reviewing and looking at personnel from a firm-wide perspective, it's important that we're looking to see that people are productive, people are utilized, uh, but not necessarily overutilized or overworked. We, you know, we really want to make sure there's a good balance of are you able to do your job successfully? Do you feel like you have the resources and you know, team members to help you when you need it? So that's a big piece when we're doing our personnel review is what do we have in our bench strength? You know, what do we really need to add? Um, just looking at historical numbers, projections, and trying to find a happy medium in terms of our growth. Um, when it comes to managing teams, I think it's just so important to, you know, be there for them, be a listening ear, you know, ask if they need help. That's that's huge. You know, you never know if someone's going home and working 12, 15 hours a day. You don't, you know, we wouldn't want that. So it's, you know, what resources do you need? Have those touch points and make sure that you're communicating with your team.
Women’s History Month: Leading the Pivot from Auditor to C-Suite
Speaker 01Yeah, and I can definitely in a professional services space where, you know, I've heard you say multiple times, you know, our people are our asset. They're our greatest strength. So really making sure that you're keeping a close eye on our people, you know, and I love that idea, you know, of how keeping tabs on utilization, but that's both ends need to be monitored, you know, completely overutilized too is something that needs to be navigated. And then also just that that kind of career path, that current career trajectory for each one too, even to get down to the individual level. Um, and and so as you're growing and adding new opportunities, just making sure there is an avenue for each. And that's something, you know, for me on the advisory side, just always mindful of okay, as we're adding new service segments, new ways of helping our clients, is there a path for those people? So and Kristen, and that kind of makes me think too, we are this episode is uh coming out during Women's History Month. And and just seeing, you know, a successful business leader like yourself who has worked through the technical route of a CPA and an auditor to a CFO in the C-suite to a strategic operations professional. You know, kind of walking through that journey, I guess, were there points in your career where you feel like you you felt like you had to kind of make adjustments, you know, kind of kind of you know, present yourself a little bit differently to kind of serve in the new roles. I guess can you kind of talk me through what your experience has been, just growing through your career?
Speaker 02Sure. Um, well, when I was an auditor, you know, I reported up through the industry partner group. And so, you know, I was a supervisor, I had an in-charge, a manager, director that all worked really closely with me, but also was able to kind of um manage the risk and what I was doing and making sure that I was, you know, checking all the boxes and doing all the right things in terms of completing the audit. Uh, when I transitioned over to the chief financial officer role, it was a um it was a big change and it was an exciting change because I got to really see how a business works and how a business runs. You know, from an audit perspective, I had prepared financial statements, I had audited financial statements, but now I was really responsible for what are they telling us? What do we need to do with this information? Um, and I was also, you know, young into my career, I had maybe six years of experience. And so communicating with seasoned partners, tenured partners. Those that had a lot more experience than me was a little bit daunting. And, you know, really just trying to learn from my supervisor, our managing partner at the time, and our current managing partner, and you know, really just taking advantage of those that I work with and using them as a sounding board is a is really great advice that I receive.
Lifelong Learning and the C-Suite Mindset
Speaker 01And just kind of, you know, seeing how you have that full view of business from the technical to the strategic. And as we've been talking about concepts like risk management, growing and scaling operations, technology, new technologies, emerging technologies, governance around considerations, managing resources, keeping an eye on the business, the financials, important KPIs, and then helping you know influence behavior around that. I guess to everyone kind of working their way up to a career listening in, and especially today during Women's History Month, women listening in, you know, are there any kind of top-line considerations that you'd really encourage all of them to focus on as they're advancing their career? So some of the headline things that can really help them accelerate their careers and really understand the businesses that they're working in and help them move up the chain in those businesses.
Speaker 02I think a big um piece of advice would be be a lifetime learner. You know, never stop reading, never stop asking questions, you know, always try to sit at a table with people that you've never sat at a table with before. You know, you never know what you're gonna take away from someone that you have not talked to before. But you know, we're so lucky in that we have so many acts, so much access to resources in terms of the financial profession literacy. We get, you know, email blasts in terms of you know what's going on in the economy. It's really important for someone who has a goal to be in the C-suite or any leadership role is to never stop learning and never stop asking questions.
The Mentorship Roadmap: Cultivating Sponsors and Strategic Relationship Building
Speaker 01I love that just the curiosity of it, kind of, you know, exactly as you're describing, just always being curious and then just lifetime learning and never feeling like I know it all. I think that that speaks very real to my experience as well. And and also for you, I mean, you're very active in the community through things like Leadership Cobb, you've been awarded, you were previously awarded a 40 under 40 award. You know, to me, you know, mentorship has been something that's helped in in my career from your perspective, too, to have the accolades you've received, you know, it's clear beyond just mentorship, kind of sponsorship, you know, kind of people behind the scenes who have helped you with your career. I guess how how did you kind of navigate that kind of cultivating mentors, cultivating sponsors, and having, you know, great business relationships as you've advanced your career?
Speaker 02Oh, that's a great question. I really think it's important for someone to put themselves out there. You know, join organizations, sit on different boards, you know, whether it's an alumni association, it could be a neighborhood HOA, because you never know who you're gonna meet, who you can collaborate with, and what you can learn from them. So I I think it, you know, a funny story I'll tell is about 10 years ago, a business journal uh article came out, and it was Top Women Leaders in Atlanta. Well, I cold called them and said, can I take you to coffee? And one of them said yes. So I thought it was a great idea. She was the CFO of a large law firm in downtown Atlanta. So I went down, bought her a coffee, and we had a great afternoon. She shared with me some experiences, just some lessons, and we stayed in touch until she retired. So it was really neat.
Speaker 01Kristen, but before I let you go and relieve you from the mic, I am curious, just do you have any kind of final thoughts for our listeners? Whether that listener is a seasoned business executive navigating growth and scaling challenges or somebody working their way up to their career and trying to make that next step with our eyes on working toward the C-suite. Just do you have any kind of final thoughts for our listeners?
Speaker 02Yeah, absolutely. Um, I think a great piece of advice is whenever the opportunity presents itself, is to surround yourself with people who are maybe not necessarily more intelligent, but emotionally intelligent, experienced, uh, have more insight, you know, innovative thoughts. You you'll never know what you'll be able to get out of people when you just ask questions and have a seat at the table.
Speaker 01I agree. Because I mean, relationships is so important in business. So I agree. It's just it's just being surrounded by good people and having good relationships.
Speaker 02That's right. People love teaching and really sharing experiences.
Speaker 01Perfect. Well, Kristen, thank you so much for your time. And to our listeners, thank you so much for tuning in. If you have any questions about the business concepts we discussed today or any other financial considerations you're navigating, please don't hesitate to contact us at www.mjcpa.com.