In this episode, we dive into a conversation with David Swatosh, a senior manager at BDO—one of the world’s largest accounting firms—to discuss some of the challenges involved in moving from a small regional firm to a large multinational one. David was able to leverage the power of internal networking to overcome some of the weaknesses in his existing network as well as to lean into some of his personal strengths. He discusses what he has done to accelerate his business development within BDO, and also advising listeners on building relationships in the context of the COVID-19 pandemic. One of the most fruitful ways of making connections and keeping in front of your target audience is by educating people and also finding specialists with whom to consult when you lack knowledge in a specific area. Joining in the conversation, listeners will also learn why attending large networking events are not the be-all and end-all and how it is all about knowing what you are good at and playing to your strengths.
Key Points From This Episode:
- The challenge of developing a new network when transitioning from a small to a large firm.
- What David has done to accelerate his business development efforts in BDO.
- Advice for building out your internal relationships before and after COVID-19.
- Suggestions for spending your time and efforts strategically in business development.
- Bringing thought leadership to other partners and using it as a marketing tool for his services.
- The importance of educating internal and external parties in your network.
- The value of having specialists to consult with and offering your expertise in return.
- Differentiating who you are, your role, target market, and where your revenue comes from.
- Thoughts on the value of attending large networking events as an introvert.
[00:00:01] ANNOUNCER: Welcome to Branch Out, a Connection Builders podcast. Helping middle market professionals connect, grow and excel in their careers. Through a series of conversations with leading professionals, we share stories and insights to take your career to the next level. A successful career begins with meaningful connections.
[00:00:20] AD: Hey everyone, welcome to Branch Out. I’m your host, Alex Drost. On today’s episode we’re going to dive into a conversation with David Swatosh, a senior manager with BDO and discuss some of the challenges he faced when moving from a smaller regional firm to a large multinational firm. David was able to use the power of internal networking to overcome some of the weaknesses in his existing network as well as to lean into some of his personal strengths. I hope you all enjoy.
[00:00:51] ANNOUNCER: Connect and grow your network. We are on LinkedIn. Search for Connection Builders.
[00:00:59] AD: David, welcome to Branch Out.
[00:01:00] DS: Thanks, Alex. I appreciate it.
[00:01:02] AD: So, David, I want to jump into a conversation that you and I were having a few weeks ago, and you were sharing some of the challenges that you had moving from the start of your career in a mid-size regional accounting firm and then moving to a larger national firm. Can you share some of those challenges with our listeners?
[00:01:19] DS: Absolutely, Alex. I think the biggest challenge that I had really moving from those two firms is developing a new network and understanding how to target my business development activities to the target market that BDO goes after. And when I was at the smaller firm, I had relationships with attorneys, bankers, my internal network at the firm, but then also different controllers, business owners, but they are all more on the smaller middle market size, whereas BDOs target market is more the upper middle market. And so I didn’t have any relationships in that space. So it made it hard for me to start developing that network and bringing business into BDO and that sort of thing. So that was probably the biggest challenge I would – Another challenge I would say is just going from a smaller firm to a larger firm. There’s a lot more that you have to do. It’s a bigger region. It’s a bigger office. It’s a bigger firm. And the scale-up is always bigger when you’re going to a national firm.
[00:02:27] AD: Well, of course. And what I want to dive into a little bit is you talk about the ability to generate business and ultimately your business development efforts in your role. And you talked about kind of the gap in the network that you had, right? In some ways you knew attorneys and some accountants, but not necessarily the right referral network. Can you share a little bit about what you’ve done to accelerate your business development efforts?
[00:02:52] DS: Absolutely. So I think when I first got to BDO, I was doing what I was doing previously, and that could have been for the first 6, 12 months, maybe even 18 months. And there really wasn’t much value in it. I wasn’t getting much traction or anything like that. So I really sat down and looked at what I should be focusing on. What is my primary source of projects? And when I looked at that, there’s a few different tiers that I guess you could put it into. One is my internal network with BDO. So with my role at BDO as a specialist, I work on projects that are typically already existing clients of BDO. So maybe 80% of my work is with existing clients. So I really focused my efforts in building that internal network within BDO with partners, with directors, with senior managers to build that relationship and give them that ability to trust me that I’m going to take care of their client. So that was probably the biggest thing.
And then with BDO as well, there’s an alliance network. That’s probably our second tier of revenue generation, is that alliance network. And so then I really try – Now I’m starting to focus on building relationships with our alliance network, which are smaller CPA firms that just don’t have the national resources that we have. And by doing that, it’s really targeting those business development efforts as opposed to just kind of throwing darts at a wall and hoping it sticks.
[00:04:26] AD: If I’m hearing you right there, really what you’re hitting on is the idea that when you start it, you’re originally going just going to networking events, going out to meet people, which can be great and does absolutely add value to your network. But as you sat back down and said from a business development strategy, you look and realize that most of your business is coming internally. So it then falls on you to figure out how to make sure those internal colleagues of yours are aware of your specialty and how you add value, right?
[00:04:56] DS: Exactly.
[00:04:56] AD: And so maybe share a little bit. What are some of the steps you’ve taken to build out some of those internal relationships and brand yourself and some of your own technical specialties within the firm?
[00:05:06] DS: It’s interesting, because now with COVID-19 here, it’s been 180 degree flip, right? I mean used to – You’d go out to lunch with partners, directors. You’d stop by their office and just chat with them a little bit. See how their day is going. See if they have kids. I have four kids. If the partner has kids and we can kind of talk about kid stuff, talk about sports, all that kind of stuff. Now it’s completely different, right? We’re doing this all virtually.
So before COVID0-19, those would have been the types of things that I would do is just sitting down with them, even having meetings with them to talk about their client list, going through that and trying to decide whether or not they would be a good candidate for an R&D credit study. A lot of times come to them with information that they could take to their client, whether it’s a thought leadership piece or some sort of questions that they can ask their client in order to spur a conversation. So all of that used to be done live with that internal network.
And so now with COVID-19 here, it’s kind of switched a little bit. We can still theoretically do it live, but it’s more virtually, right? I’ve had happy hours with some of the partners or directors just touching base with them through video conferencing and that sort of stuff. But one thing that I guess hasn’t necessarily changed is email. So from an email perspective, kind of touching base with those partners, those directors and providing them thought leadership if something comes out that’s new for the R&D credit or any other specialty service that we’re offering. Then giving them the ammunition through an email to send out to their clients, whether it’s a draft email or, again, whether it’s a thought leadership piece. So those are a lot of the things that we’re doing now. It’s just to kind of stay top of mind with them, because I’m very convinced, if they can’t hear you or see you or something like that, then they’re going to forget about you. And in order to stay that top of mind you have to kind of constantly give them information that’s valuable to them.
[00:07:18] AD: And I like that. As I hear you say that, you’re talking about leading with value and looking for ways to show up with a solution and where your networking efforts aren’t just the go out and build the relationship, which is absolutely an important aspect in that, but you’re also showing up and talking about more than, “Hey, I do R&D tax credits, or I do whatever it might be.” You’re showing up and saying, “I do this and here’s where I think we can add value to some of your clients.”
Now knowing that, there’s obviously limited hours in the day and you can only spend so much of your time on those efforts. What are some of the things you’ve done to prioritize or to think more strategically about where you might spend your efforts in that business development?
[00:08:03] DS: I think a lot of it is just staying organized. And so I keep a list of prospects for myself. And on that list of prospects I have high priority prospects, I have long shot type prospects and then also – And then kind of in between. So there’s three kind of three categories. So on those high priority ones I’ve you know I have listed out who the contact is if it’s not me. So if it’s a partner or a director or somebody else that’s working to bring that into that client into BDO, I just make sure that I know who’s responsible for that. That way I can just kind of reach out on those touch points and be like, “Hey, how are things going with X prospect or X client? And let me know if there’s anything I can do to help support you from a client service perspective.” So that’s kind of how I like to prioritize things. Again, COVID has changed so many things, but that’s the easiest way that I have found that I keep track of where everything is and being able to prioritize things.
[00:09:05] AD: No. And I think that makes a lot of sense. Now we’ve said obviously a few times COVID has changed everything, and while we all have hopes that one day things will go back to some level of normal, I do think this is here to stay in some ways for a while. What have you done to pivot some? How are you rethinking, right? I assume most of your approach and the mindset to it hasn’t necessarily changed, but the actual tactical execution of it certainly has to look different today. So maybe share a little bit about what you’ve done to pivot.
[00:09:32] DS: So I think the biggest thing is providing the last several weeks or I would say – And from an R&D credit perspective, it’s not as is important. But our R&D credit group at BDO has transitioned into the employee retention credit group as well. And so that’s a COVID-19 credit that is benefiting a lot of our clients. And so we’ve kind of transitioned to this employee retention credit, and it’s brand new. So we’re trying to hit really hard on our partners, our directors and that kind of stuff to help their clients out. And so from that perspective – So I’m kind of talking from that perspective when we talk about this right now. But it’s a lot of emails. I mean it really is. It’s a lot of emails. But what we’re doing is trying to provide that value and giving them the ammunition to go to their clients and say, “Hey, have you looked at this? Here’s a list of things that would qualify you or here’s a list of the benefit that you can do.” Or for example – So BDO, we’ve come out with a software that we’re going to use for the employee retention credit. And I mean that’s very unique, quite honestly. There’s not going to be a lot of firms or competitors that have this software.
And so we’re able to go to the clients and say, “Hey, this differentiates us from other people, from other firms, from other competitors,” and it’s giving them that ammunition so they can provide that value to their client or their prospect and that kind of thing so. Again, it’s a lot of emails that are kind of going back and forth, but we have business development meetings weekly or monthly business development meetings where you can kind of present on a topic. So I might be able to present on the R&D credit and bring everybody up to speed on some of the new things that may have come out, or again, this employee retention credit, same thing. And so we have people with the PPP loan. Anything out there that’s just the new in getting that information to the right people, it’s the easiest strategy.
[00:11:31] AD: And David, if I’m hearing you right, a lot of the same thing that seems to come up, and whether it’s the R&D tax creditor. As you talk about today, the employee retention credit. Ultimately, you are a specialist in the tax world and you are looking to continually bring thought leadership to some of the other partners and using some of that as almost a marketing tool for yourself and for your specific services knowing that those clients are in need of them and that the partners that are serving them might not be fully aware of some of the nuances out there. Is that a fair summary?
[00:12:05] DS: It definitely is. I mean with everything in the tax code, there’s never black and white answer, I’ll say. A lot of it can be a gray area. That’s where our expertise comes in is, is helping our clients interpret those nuances, that gray area, for them to make decisions. And to do that though, in order for us to get in front of those clients, we have to go through our internal referral sources, our internal network, which means we have to educate them as well on those nuances on that gray area. That way they can communicate to the client or the prospect that, “Hey, there’s all this information out there that is uncertain. So let us have a phone call. Let’s just set up a 30-minute phone call with our specialist.” And if it amounts to something, great. If it doesn’t, that’s great too, right? It’s more about servicing the client than it is necessarily about winning the work, or getting a new project, or getting the revenue. We just want to service our client make sure that they have the information to make the best decisions.
[00:13:05] ANNOUNCER: This is Branch Out, a Connection Builders podcast.
[00:13:15] AD: I love what you said there, right? You bring it back to this idea of educating. And you said it in the context of educating the partners that are going to be out there, but that does flow through to client education. And whether it be internally or externally, I think a huge chunk of what we as professionals do is you educate those in your network about ways that you can directly bring value to them. So maybe share a little bit, because you come from a part of professional services that is very complex and changes all the time. That’s why you have a job, is because their tax code stay the same. Share a little bit about what you’ve done to keep yourself top of your game, not necessarily the technical details, but how do you make sure that you have thought leadership and you’re presenting it in an educational way to those around you.
[00:14:03] DS: So that’s a good question. I mean a lot of it is staying aware of the nuances that are out there, okay? Staying aware of court cases that might come out. Staying aware of the industry that you’re working with, whether it’s manufacturing, whether it’s real estate, construction, whatever industry it is. Because it’s a different story or a different situation for each industry. So if I relate it to the R&D credit, the same activities that you would qualify from a manufacturing perspective are not the same activities that you’d qualify from a construction perspective.
So you have to know all of the industry knowledge in order to tailor that conversation to that particular, again, whether it’s your internal network or whether it’s the actual client or prospect. It helps to stay abreast of that type of information. So that’s one way I guess from a non-technical perspective to stay educated myself. But the other is, again, just really – So at BDO we have – I mean there’s several individuals on our R&D credit team that are writing those thought leadership pieces. When something new comes out, we stay on top of it. Get a piece written. Get it out on our website at bdo.com. Distribute that through our own internal servers or networks or whatever it is to all the partners and stuff and then also sharing it on LinkedIn and sending it directly and all that kind of stuff. So that’s one way to kind of stay abreast of the of the ever-changing world, whether it’s on a state perspective, a federal perspective and that sort of thing.
[00:15:45] AD: I want to dive into that a little bit. I think, again, the idea of as a professional, it is your job to bring that that leading edge knowledge and that awareness. And that doesn’t mean – What I didn’t hear you say is that you’re the expert in all of that and you spent all the time understanding that. What I heard is you’ve put yourself around not only those at your firm, but other places in your network to have the right either places to look to get the information or be having the right conversations to stay ahead of that curve. Is that a fair assessment?
[00:16:14] DS: Yeah, definitely. I mean we can’t be an expert in everything, right? And just a good example is in our Southeast Michigan we have a lot of manufacturing. So I have a lot of manufacturing experience, right? And the west side of the country, our teams out there have a lot of software experience. Well, we might have situations where they’re calling us to say, “Hey, we’ve got this situation. What are your thoughts?” Or we might be calling them to say, “Hey, we know you’ve got a lot of experience over here. What are your thoughts on this?” And so we do a lot of sharing of those resources because we can’t be experts in everything. I would say I’m an expert in section 41 and section 174 of the Internal Revenue Code, but how that applies to each specific industry, each specific situation, I mean there could be times where I’ve never dealt with something like that. And so you have to rely on somebody else. Or kind of getting outside of my own little world, if I’m having conversations with clients or prospects or, again, my internal network, and they start talking about something I might be like, “Oh, well I know about a smidgen of information. Just enough to know that I need to get somebody else involved.”
And so I’ll reach out to other individuals, whether it’s in a state and local perspective, an international perspective, or maybe it’s just a regular tax return question and that sort of thing. So you have to be aware of all these other things and that are going on within your industry or within your client base, but you don’t have to know everything. You want to rely on other people that are smarter than you in that particular area.
[00:17:54] AD: No. And you hit on a really great point there. This goes back to the value of your network, and we could talk about this for hours about where your network adds value, because it’s so many different ways to look at it. But what you’re really talking here is it’s that additional knowledge, that ability to be the go-to resource. And your internal network has helped create some of that, I assume, right? Because at BDO, I assume there are a lot of professionals that practice in the tax credit department across the firm nationally, right? Now have you made efforts in building certain relationships internally that might not be referrals, but more are now knowledge sharing referrals? Do you have a community that you can turn to where when you have these types of questions you can discuss them with someone?
[00:18:43] DS: I think that comes back to building those relationships. And so there’s certain people that I’ve built relationships with that if I have a general tax question, that’s who I’m going to go to. And because I trust their knowledge. Whether it’s on state and local, I have a guy that I go to. International, I have a guy that I go to. Again, regular tax questions, I have somebody that that I would go to ask that question. And so building those relationships, it’s kind of a – In a way, it’s a two-way street, because now generally speaking you’re building relationships to build business, right? And I’m trying to build a business as well, but I’m also trying to help them build their business. So I want to bring those questions to them and bring them in as a specialist just as they would bring me in as a specialist.
So we always kind of have that go-to person. And then even outside, from an external perspective, there’re bankers that I trust. There’re attorneys that I trust. There’re different people out there that if I know if I have something, if there’s a question that I can’t answer, I’ve got somebody that I can go to that can answer that question.
[00:19:53] AD: I love it. I mean that is ultimately the key of the network is to be able to be that value-added resource for those in your network, right? Whether that’d be clients or others. So I want to talk then maybe to wind down the end of this conversation. We talk about the challenges you face moving from that they’re a smaller firm to a larger firm. Just in the fact that your network wasn’t necessarily built out in the right ways, you’ve taken some of those steps to build your network, and obviously that’s a never-ending process that you do for your entire career. But what are things that you look for or you look back and say, “If I would have started this a little bit earlier or if I would have maybe approached this a little bit differently and had a different mindset, it would have made a meaningful difference.” And obviously you’re doing it now, but maybe something you could share for some of our listeners that are earlier in their career and so maybe they may miss some of those same mistakes.
[00:20:48] DS: You have to differentiate who you are. What your role is and what your target market is. For myself, and this goes back to my prior firm as well as with BDO, my focus, it wasn’t clear. I didn’t have a specific focus on. And because I think there’s this – With CPA firms, with accounting firms, there’s this understanding that you have to build this huge external network. Well, when you’re a specialist, you don’t really have to do that.
And so I spent so much time trying to build that external network, whether it was through the Detroit Economic Club, the Young Leader Program, whether it was through MICPA, whether it was through ACG, all these external groups that you can be a part of and go network with and that kind of thing. I think it really slowed my progress down by focusing on that.
So once I came here to BDO and I said, “You know what? I need to figure out, “Okay, where is my revenue coming from?” And if you figure out where your revenue comes from, then you can specifically target those networking opportunities. Again, whether it’s internally, just building relationships with co-workers of yours, or different offices. And it’s super important too, because there’s a career aspect to it as well. In our business, not only is it good for business development, but it’s good for your career to know people outside of your own office. It’s good to know people nationally and that sort of thing. So there’s kind of a two-prong benefit to building that internal network instead of focusing so much time externally, where there’s really potentially not any value.
[00:22:34] AD: Yeah. No. I couldn’t agree with you more. Now I want to ask then, you started, and you said your early days of networking, you went to the large networking events. And then obviously realized over time that that wasn’t the best use of your time. Why did you start going to them? What made you start with that approach to networking?
[00:22:51] DS: I think that was just the thing that you’re supposed to do. As an accountant, that’s what you’re supposed to do. You’re supposed to go to networking events. You’re supposed to shake hands with people and build relationships with bankers and attorneys and M&A guys and all these things and you just go and you do that. One thing I found out was that I’m really more of an introvert than an extrovert. And so that didn’t work for me. And it was somebody that was an extrovert, that might work really well. Going to a going to a DC luncheon, you’re going around and shaking 50 people’s hands and introducing yourself and handing out business cards. Oh, that’s just not me. Okay? I mean I’ve been doing this for 15 years now, but unfortunately just found out probably in the last two years that I shouldn’t be doing those things if it’s not my strong suit. And so that’s why I kind of shifted that focus.
[00:23:46] AD: And David, I actually love that story, right? I am the extrovert. I’m sure you and I met at one of those events that I was running around handing 50 business cards out, right? And that’s something I’m good at and I enjoy. What I really do want to make sure we hone in on here is that that’s not the only way to network. Now I don’t want to discount the value in having a broader network and spending some time at events like that, but it shouldn’t be the only way you network and it absolutely does not have to be the bulk of your time, right? And you said, and I’ve talked to so many people that sit in your same shoes that I can’t relate because I am extroverted, but for those people that are introverted and don’t enjoy that, putting yourself in that situation continually again and again isn’t going to get the results you want and it’s candidly just going to drain your energy levels more where you are so much better off to sit back and be smart about how you approach it and realize that you don’t have to follow the norm that everyone talks about, right? So I really do admire that you’ve been able to figure some of that out.
So, well, David, I really appreciate your time today. This has been a lot of fun and looking forward to having you back on a guest sometime in the future.
[00:24:55] DS: Sounds good, Alex. Thanks so much. Thank you.
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