How to Know If Your Firm Has a Leadership Problem 

Most Firms Wait Too Long to Focus on Leadership Development

Leadership development often takes a backseat until firms realize there is no one ready to take over when senior leaders retire. By then, the problem has already become a crisis.

Leadership development for accounting firms is often overlooked until it’s almost too late. Most firms wait until there is a crisis before investing in leadership development for accounting firms, but by then, the problem is already urgent.

Here are the top warning signs that your firm has a leadership gap.  If you’re seeing these signs play out in your firm, this is your invitation to address it before it’s too late.  

1. High Turnover Among Top Talent

If your best employees are leaving, leadership issues may be the root cause. Many firms assume turnover is about salary or laziness, but more often, employees leave because they don’t see a clear career path or feel unsupported in their growth.

2. Managers Who Lack Initiative

Some employees do their work but do not take ownership of projects, client relationships, or firm growth. Leadership development should focus on building confidence, decision-making skills, and accountability at every level.

3. Unprepared Successors

If your firm does not have leaders ready to step in, succession planning becomes impossible. Strong leadership development ensures that future leaders are actively being trained before they get called up.

4. Partners Doing Too Much

Instead of mentoring and guiding the next generation, senior partners often take on more work themselves because no one below them is prepared. This cycle leads to burnout at the top and disengagement at lower levels.  For reference, in elite small firms, partner billable hours targets should be around 1,000.  If you’re significantly higher than that, this is a sign of a brewing issue.

5. Leadership Training That Doesn’t Work

Many firms invest in one-off training sessions that create short-term excitement but no lasting change. If your past investments in leadership development did not deliver results, it may be because there was no structure, follow-through, or measurable ROI.

What to Do Next

Leadership development should be an ongoing process, not a one-time event. The best firms focus on developing leaders at every level, starting on day one.  

If you are seeing these warning signs, it may be time to take a more strategic approach to leadership development for accounting firms. Learn how we can help you craft a pipeline development strategy that retains talent and moves the needle on your strategic goals.