John Kennedy explains how to turn a casual chat into a steady flow of high-quality clients. A common problem that limits the success of many practices is also one of the most damaging, but happily, it is also one of the easiest to fix. In this article, I will show you how to turn an informal chat into a positive client relationship. When you master this structure, you will be able to manage any conversation so your potential clients will understand how they will benefit from working with you. The self-defeating spiral A typical self-defeating spiral causes significant damage, and it goes something like this: I don’t feel comfortable talking about myself. When I meet potential clients, I often don’t know what to say. I wish I had more clients and more high-quality clients with whom I like to work. I don’t feel successful, so I lack confidence when I talk to potential clients about my practice. For many years, I have focused on identifying what sets high achievers apart. There is overwhelming evidence that the ability to shape and structure a casual conversation is perhaps the single most crucial skill. This skill is not a result of natural talent, charisma or charm – it is a strength that is practised and learned. Successful client conversations It may seem obvious, but a fruitful conversation involves two people taking turns at listening and talking. Yet time and time again, when the pressure of wanting to make a good impression takes over, we make the same mistake. And, odds are, this has happened to you.  It is easy to fall into the trap of believing that your task is to list the many reasons why the other party should become your client. You say more and more about what you think you should tell them until you reach the point – and this can sometimes come frustratingly early – where you run out of things to say or, worse, you keep talking without feeling in control of the conversation as an unwelcome unease inside you begins to grow. Mastering this skill is easier than you think. A fruitful conversation is about listening and talking. You need to understand how to do both effectively and appreciate how each fits together. So, here is the structure of a successful client chat. 1. Prepare The first stage of the conversation takes place when you are on your own. There is no talking or listening, just thinking things through and creating an approach that works. To master the skill of turning casual chats into client contracts, you need to structure your thoughts. You need to understand how best to probe the value your potential client is seeking, the best way to present the value you can offer, and how to propose the next step in what will lead to a long-term, mutually rewarding relationship. 2. Probe The conversation begins here. This stage mostly involves listening and knowing how to guide the other party so that they talk about issues that move the discussion into ‘productive’ territory. Your main task is to keep the conversation casual, interesting to your client, and moving towards an understanding of the value they can achieve by working with you. You do this by asking high-quality questions. As you chat, gently guide the other party through a series of casual questions in a way that helps them clarify their thinking and reach a more valuable understanding of the outcome that is most important to them. The ability to do this effectively is a skill that takes time and practice. However, three fundamental questions form the bedrock of  every successful client conversation: What will success look like? How will you know if we have achieved the success you seek? What is most important to you about achieving that success? You probe your potential client’s thinking by asking these – and related – questions to help them think in a more structured way about their goals. Most clients are unclear as to what they want to achieve, so helping them identify their priorities will encourage them to talk with you more. You don’t do this by telling them how clever you are or by providing all the answers. The real skill and value lie in allowing potential clients to experience your proficiency by helping them structure and organise their thinking. When you master the skill of eliciting the most precise answers possible to these three fundamental questions, you will set yourself apart. By taking this approach, potential clients will experience the value of your expertise, and you will demonstrate that you are focused on helping them define, and then achieve, the success they seek.  These are the firmest possible foundations for a high-value client relationship. 3. Present Only now do you begin to talk more than you listen, and you keep asking questions to maintain focus on the critical issues. In this phase, your task is to help the client see how they will benefit from working with you. You may be inclined to talk about what you will do, but technical considerations are not very motivating for potential clients. Your critical task is to increase their motivation to the point where they decide to work with you. You do this by giving examples, by telling stories of how you helped others facing similar issues, and by focusing on how things will improve. This evidence is already captured in your value menu, where you prepared a store of material that will help your client feel they are in good hands. The stronger they feel about the specific value they will achieve by working with you, the more you will stand out as someone they can trust. 4. Propose In this step, you move the relationship from talk to action. By probing how the other person currently sees things, and how they would like things to be in the future, you are helping them untangle the issues and identify the outcomes about which they feel most strongly. These are the foundations of a strong, trusting relationship. At this point, you may suggest talking further – but before then, you will send a brief note indicating how you can help achieve the success they seek (this is very different to the standard ‘letter of engagement’). The purpose of the note is to confirm that you have fully understood the outcomes your client desires.  A succinct note about the value they will receive will move you from a casual, theoretical chat to a highly practical and highly focused discussion on the specific reasons you should both work together. Like a road journey at night This is likely to be very different to the path you have followed up to now. The traditional, and often ineffective, model tells you that you should outline your expertise at every opportunity; that you should see every conversation as a sales opportunity and sell from the outset. Sometimes this sales “advice” is even more aggressive with outdated jargon that speaks of “closing the deal” or trapping the potential client in the “killing zone”. This is hardly a basis on which to build a high-quality practice with the right clients and high-trust relationships. Instead, the Practice Builder approach outlines the specific steps you should take to help a potential client identify and access the value that is truly important to them. And through a well-structured conversation, you let them experience how you are an essential element in arriving at the outcome they want. It’s like taking a road journey at night. Through your questioning, you help your client identify the destination at which they wish to arrive. You then map out the route and together, you can set off on your conversational journey. You use your questions like headlights, to light up the landmarks and road signs for the next stage of the journey. The critical thing to remember is that you are in the driving seat, choosing the route, and setting the speed – but your client gets to adjust anything that makes the journey comfortable for them, such as opening the window or choosing the music. In this way, the conversation remains a comfortable and stress-free casual chat, but with a clear set of directions, milestones and a destination that you both reach by working together. This approach is fundamentally about helping your client arrive at the success they most value. When you stand out as a master at this, your client will want you on every journey. And they will want to tell all of their friends about you. This is a firm foundation on which to build a successful practice.   John Kennedy is an experienced strategic advisor who has worked with senior management teams in a range of organisations and sectors.

Olivia McEvoy outlines the diversity and inclusion issues at play in companies across the island of Ireland. As part of EY’s commitment to building a better working world, the firm conducts an annual survey to benchmark diversity and inclusion activity in organisations across the island of Ireland. The third survey reflects the experience of more than 150 C-suite leaders, human resource directors and diversity and inclusion leads. The respondents were drawn from both indigenous Irish and global organisations of varying sizes across a range of diverse sectors. This article outlines how organisations view and position diversity and inclusion. Smart working It is encouraging to note that appetite for diversity and inclusion remains constant. 100% of businesses say it is vital to business performance, and 82% recognise the impact of diversity of thought on decision and risk excellence. Indeed, there is no shortage of appreciation of the connection with diversity and inclusion and more significant customer and employee engagement, productivity, innovation and creativity, as well as talent acquisition and retention. With 95% of survey respondents aware of the pending Gender Pay Gap legislation, which is scheduled to take effect in 2020, significant numbers (71%) are also embracing a critical means of addressing the gender pay gap: a smart working culture. Smart working is a set of practices that add greater flexibility to work methods through innovative solutions and is measured by the achievement of results regardless of where and how employees perform their work. Flexible location, schedule, hours worked, and shared responsibility are some of the markers of smart working. Some organisations refer to smart working as agile, flexible, new ways of working or modern ways of working. The Gender Pay Gap legislation will also provide welcomed impetus and transparency, albeit 60% of organisations already publicly communicate information about their diversity and inclusion goals and targets. Absence of accountability However, there is still a ‘diversity and inclusion disconnection’ between what organisations are saying and what they are doing in this space. Leadership behaviour is the cornerstone of an inclusive environment and enables a culture of psychological safety, but just over half (53%) take responsibility to call out inappropriate behaviour and language. Leadership accountability is one of the most significant game-changers in achieving meaningful transformation, but a critically low 24% of leaders have diversity and inclusion goals or targets tied to their performance metrics and reward. Measuring the impact of diversity and inclusion on performance is instrumental but a rarity (16%) in organisations. Investment is also inextricably linked to enhanced organisational reputation, decision-making and talent attraction, but a third (31%) of organisations invest nothing and 43% spend less than €25,000. The majority of actual investment is a combination of events (63.8%), networks and network membership fees (52.2% and 40.6% respectively) and sponsorship (30.4%) rather than in the more strategic and systemic changes needed to develop the processes, capability and behaviours required to achieve lasting change. Delivering on diversity With ‘business as usual’ often enough to overwhelm, it is easy to get distracted and presume that if someone else in the organisation is talking about diversity and inclusion, that is enough. Indeed, lots of talk about it leads us to believe that the diversity and inclusion box is being ticked. But box-ticking is not enough. Talking is not enough. We need to adopt a transformational approach that embeds diversity and inclusion as part of our systems, structures and, ultimately, our culture if we want to realise meaningful change; and we must be bold personal agents of that change. As evidenced in the EY Ireland 2019 Diversity & Inclusion Survey report, there is some progress in some areas but regression in others – and certainly nothing like the ‘gear change’ called for in previous years. Rather than make exaggerated claims or aspire to progress, we need to be able to proclaim positive outcomes and actual results and deliver on diversity and inclusion. Everybody in? Olivia McEvoy is Director of Diversity & Inclusion in People Advisory Services at EY Ireland.   EY is launching its fourth annual Diversity and Inclusion (D&I) survey of organisations across the island of Ireland and we would be very grateful for your participation. The survey will remain open until 19 February 19th. Take the survey here: www.surveymonkey.com/r/EYDiversityInclusionSurveyIreland2020

A new report proposes measures for the sustainability of owners’ management companies and lays the foundation for a more structured approach to managing apartment complexes or managed estates. By David Rouse In a professional audit or reporting capacity, Chartered Accountants may encounter owners’ management companies (OMC). Readers living in an apartment complex or managed estate may even have been asked to serve as an OMC director. OMCs, while in form incorporated typically as companies limited by guarantee (CLG), are in substance hybrid entities. They sit at a corporate crossroads between not-for-profit companies, property management businesses and residents’ associations (see Figure 1). Many readers will be familiar with the legacy construction and financial issues facing these companies. High-profile cases such as Priory Hall and Longboat Quay, as well as other less prominent estates, have featured in the press in recent years while corporate governance failings in OMCs receive periodic attention in court reporting. The country’s largest OMCs have multi-million euro annual service charge budgets. And yet, the stewardship of these companies is entrusted to unpaid, untrained directors (the term “volunteer director” is deliberately avoided, as in law, there is no such thing – a director is a director). There is as yet no firm handle on the number of OMCs in the country. However, it is estimated that the upper limit is likely to be about 8,000 companies. New report A recent independent report titled Owners’ Management Companies – Sustainable Apartment Living for Ireland considers issues that will be familiar to those with even a passing knowledge of managed estates and OMCs. The report was jointly commissioned by the Housing Agency and Clúid Housing. The Housing Agency works with the Department of Housing, Planning and Local Government, local authorities, and approved housing bodies (AHB) in the delivery of housing and housing services. Clúid is the State’s largest AHB, managing  just over 7,000 homes across the country. The inadequacy of annual service charges, failure to provide for building maintenance (sinking) funds, and the persistent problem of mounting debtors are just some of the topics assessed. International best practice is examined, and Ontario and New South Wales are among the comparator jurisdictions featured. The future demand for high-density housing is signalled in the context of new Government policy, such as the National Planning Framework and the Climate Action Plan. To audit or not to audit? Recommendations for reform across a range of relevant regulatory systems are proposed. Of interest to the accountancy profession will be the recommendation for the removal of the audit exemption currently available to OMCs, most of which, as noted earlier, are incorporated as CLGs. Companies Act 2014 provides the audit exemption for CLGs. In this way, small not-for-profit companies without shareholders may benefit from a reduced financial and administrative burden. (It should be noted that under sections 334 and 1218 of the Companies Act, any one member of the CLG may in effect demand an audit.) However, while OMCs are not-for-profit, they are responsible for multi-million euro property assets in the form of estate common areas. Considering the centrality of OMCs to property values, good title, and quality of living spaces, the value of an audit to members in terms of assurance, transparency, and governance cannot be overstated. Finance and governance The creditworthiness of OMCs in the context of current under-funding is also considered. Regulation over and above corporate compliance enforced by the ODCE is recommended. Dispute resolution outside of the courts is advocated, as are more cost-effective avenues for service charge debt recovery. Personal insolvency practitioners will be aware that OMC service charge debt is an “excludable debt” under the Personal Insolvency Act 2012. Only with the consent of the creditor (i.e. the OMC) may management fee balances be reduced or written off in a Personal Insolvency Arrangement. The report’s other recommendations include mandatory training for OMC directors, the standardisation of accounts to a format prescribed for OMCs, and enhanced insurance obligations. Reform may be some way off. In the meantime, practitioners should be aware that the Institute’s practice toolkit, Owners’ Management Company PQAs, was updated in 2018. This replaces the 2011 version. As the Institute’s product catalogue notes, and as may be recognised from sectoral weaknesses highlighted in this commentary, although OMCs can be small in size, they may be higher-risk clients. Future regulation of the sector could mitigate a number of the risks identified.   David Rouse FCA is an advisor with the Housing Agency, a director of the Apartment Owners’ Network CLG, and a director of one of the country’s largest OMCs.

Three years after its commencement, Construction Contracts Act, 2013 continues to provide a pathway to cash flow in the construction sector. By Pat Breen TD This innovative and important legislation for the construction sector, which was commenced in 2016, regulates payments and particularly the timing of payments under construction contracts. While many businesses in the construction sector are aware of this legislation, some businesses may not be fully aware of the detailed statutory protections and obligations set out in the Construction Contracts Act, 2013. One of the key objectives of the legislation is to provide payment certainty for subcontractors, who were considered vulnerable in the payment cycle in the construction sector. As the construction sector continues to expand, cash flow is critical and it is cash flow that is at the core of the Construction Contracts Act, 2013. Therefore, construction businesses should ensure that their payment practices comply with the terms of this legislation. I consider that members of the accountancy profession are uniquely placed to encourage construction businesses across the country to review their payment practices to ensure that they comply with this legislation. I welcome the opportunity provided by Accountancy Ireland to highlight this legislation, and a brief summary of the main provisions of the Act is set out below. Further information on the Act is available on the website of my Department at www.dbei.gov.ie. Applicability of the Construction Contracts Act, 2013 to construction contracts The Construction Contracts Act, 2013 applies to certain construction contracts entered into after 25 July 2016, but not to all such contracts. For example, it excludes: Contracts of a value of not more than €10,000; or Contracts that relate only to a dwelling of not greater than 200 square metres where a party to such a contract occupies, or intends to occupy, the dwelling as his/her residence; or Contracts between a State authority and its partner in a public private partnership arrangement. All other construction contracts must comply with the provisions of the Act and the parties may not seek to exclude a contract from the legislation under any circumstances, whether the contract is an oral contract or a written contract. Construction contracts to which the Act applies must provide for the following contractual terms: The amount of each interim and final payment, or an adequate mechanism for determining those amounts; The payment claim date for each amount due, or an adequate mechanism for determining it; and The period between the payment claim date and the date on which the amount is due. Main contracts and subcontracts Main contractors are at liberty to agree their contractual terms with their clients, subject to adhering to the mandatory provisions required by the Act as outlined above. However, if a main contract fails to fully incorporate the mandatory provisions, then the Act imposes the applicable contractual term or terms set out in the Schedule to the Act, terms which are also applicable to subcontracts. The Act stipulates that all subcontracts must at least provide the following payment claim dates: 30 days after the commencement date of the construction contract; 30 days after the payment claim date referred to above and every 30 days thereafter up to the date of substantial completion; and 30 days after the date of final completion. The date on which payment is due in relation to an amount claimed under a subcontract shall be no later than 30 days after the payment claim date. The Act permits the parties to a subcontract to make more favourable provision for a subcontractor than the above contractual terms. Payment claims An executing party – the party which carries out the work under a construction contract – is required to submit a payment claim notice to the other party no later than five days after the relevant payment claim date. If the other party disputes the amount claimed by the executing party, that party is required to respond to the executing party in writing no later than 21 days after the payment claim date setting out the reason(s) why the amount claimed is disputed and the amount, if any, that it proposes to pay to the executing party. It may be possible for the parties to reach an agreement on the amount to be paid to the executing party. However, if no such agreement is reached by the payment due date, the other party is legally required to pay the executing party the amount, if any, which the other party proposed to pay in its response to the contested payment claim notice from the executing party. This payment shall be made no later than the payment due date in accordance with Section 4(3)(b) of the Construction Contracts Act, 2013. Statutory adjudication of payment disputes The Construction Contracts Act, 2013 also introduced, for the first time in Ireland, a statutory right to refer a payment dispute for adjudication. A ‘notice of intention’ to refer a payment dispute for adjudication must be served by one of the parties to the payment dispute. The parties may then jointly agree to appoint an adjudicator of their own choice, within a five-day period. However, if the parties cannot reach agreement on who to appoint, an application may be made after the five-day period to the Chair of the Construction Contracts Adjudication Panel, Dr Nael Bunni, to request the appointment of an adjudicator to the dispute. The appointed adjudicator, whether appointed by agreement of the parties or by the Chair, is required to reach a decision on the dispute within 28 days. This period may be extended in certain circumstances.   Pat Breen TD is Minister of State at the Department of Business, Enterprise and Innovation.