Todd Herman

Much has been written about Total Quality Management and Cost of Quality. When I began researching how to apply these principles to my business, I quickly learned that little had been written on these subjects for professional services. I believe this reflects the unique features of professional services:

  • The service is often designed exclusively for the client.
  • The client often participates in delivery of the service.
  • The end result of the service may be reasonably well-defined, but how the service is performed is generally not defined.
  • The client is relying on the professional to provide knowledge or experience essential to the project.

These factors make it difficult to define – let alone assess – the quality of professional services.

"Quality" is defined as "conformance to requirements" by Philip Crosby in his book, Quality is Free. Requirements for manufactured products are fairly easy to define – for example, a pair of jeans labeled as 34" waist and 36" inseam should conform to these measurements. Professional services have few tangible specifications. Any specifications usually apply only to the end result of the service. Such a specification is incomplete, because how the service is performed determines a significant part of professional service quality.

I found one book to be exceptionally helpful in identifying requirements and measuring conformance for professional services: Delivering Service Quality. The authors identified five dimensions of service quality that help address how the service is performed: tangibles, reliability, responsiveness, assurance and empathy. The authors also provide a questionnaire, which we adapted to CPA consulting services, having three main sections:

  • Questions that quantify expectations for quality service along the five dimensions.
  • Questions that quantify perceptions of the service received along the five dimensions.
  • Percentages that quantify the relative importance of the five dimensions.

This format allows a client to identify items that are most important to him or her. We can then use this information to tailor the delivery of our services to each client's individual expectations.

In the next report, I will share the results of my service quality surveys of current and potential clients, and compare them with a recent survey of Big Six service quality.

We have used our professional time to:

Chart showing most of our business time is spent serving our clients

Thank you for your contributions to my practice. We welcome the opportunity to discuss your needs and explain how we can provide services that support your company's future success.

Respectfully submitted,

Todd L. Herman

Todd L. Herman


Client Project Update:

I am pleased to provide you with an update on our client projects. Projects we have completed over this period are...

Tracking and Inventory Control System

Recommending additional controls and procedures for a new AS/400 production tracking and inventory control system of a hosiery manufacturer.

Enhancing a Work-in-Progress Accounting System

Enhancing a work-in-process accounting system for an apparel designer and manufacturer.

Timeliness and Accuracy of Approval

Recommending changes to improve the timeliness and accuracy of new style approval procedures at an apparel company.

Developing a Product Costing Application

Developing a preliminary product costing application that allows apparel designers and merchandisers to quickly estimate new product costs using existing standard costs.

Outlining Business and Finance Issues

Outlining the business and finance issues for a proposed reorganization of a health care provider.

Improve Excel Spreadsheet Budgeting

Working with various companies to improve their use of the Excel spreadsheet in budgeting and financial projections.

Future projects we are planning include...

Software Selection & Implementation

Identifying software to improve the timeli-ness and accuracy of information prepared by the financial planning and analysis depart-ment of an apparel designer and marketer.

Contribution Margin Reporting & Analysis Procedures

Identifying software to improve the timeli-ness and accuracy of information prepared by the financial planning and analysis depart-ment of an apparel designer and marketer.

Reorganized Accounting & Systems

Reorganizing the accounting and systems functions of a growth stage company in the health care industry.

Cost Behavior & Improvement

Reorganizing the accounting and systems functions of a growth stage company in the health care industry.

Revisions to Accounts Receivable & Credit Functions

Suggesting revisions to the accounts receivable and credit functions of a knitwear manufacturer to improve efficiency and effectiveness.