Analysis of Albert D Eigen, CPA Firm - Case Study Example

• SWOT Analysis Essay on Albert D. Eigen, CPA Firm
• Background

Albert D. Eigen is a certified CPA company located in Malverne, New York State. Their training in business and understanding of doctrines of general law and taxation provide them with the proficiencies to assist people with both private and business financial decisions. Certified Public Accountants are accredited by the government to provide independent attest expertise that incorporates the audit and review of fiscal statements that may be needed by third parties to offer a level of guarantee that the financials precisely reflect about the company. The organization is located in a highly competitive business environment where other larger organizations also exist and offer the similar and of different products. There is a need to conduct a SWOT analysis of Albert D. Eigen to determine it position in the highly competitive market.

• Strengths

The firm focuses majorly on client growth by meetings their needs to ensure that they come back and refer the company’s services to other potential customers. Meeting the clients' needs has provided the company an opportunity to strategically expand the services it offers (Johnson 262). The small number of employees and the small client base allows the organization to pay close attention to its clients by providing customized and quality services. The two major areas the organization has grown remarkably are pension plans and investment management services. As the firm gains expertise and establishes its reputation in these two areas, it has also been growing its client base. The company has successfully established its services, which have been important in maintaining high client retention (Spirig, 364). The high client retention rate provides consistent referrals to the firm, most of who are in selected vertical markets that are privately owned.

Although the firm has a small workforce, the staffs are highly experienced and help to maintain the growth of the firm through the provision of high-quality professional services to the clients. The firm is perceived as timely, professional, trustworthy, and accurate among the clients, which is an important marketing strategy. It continuously offers services in an innovative manner to create a source for business planning solutions that are difficult to emulate, especially by the rivals. The expertise enables their corporate and individual clients to better realize their financial objectives. The firm provides a variety of valuable services that enable the clients to optimize their profitability and minimize their tax exposure to enhance further growth.

In addition, the small size of the firm makes it easy for the management to be involved in the work process. This situation allows the management to effectively and efficiently control and monitor all internal processes, which is important in determining the procedures or stages that need to be improved or removed. With a small number of workers, the organization is able to control the expenses by ensuring that only essential processes have the required professional personnel. In this case, wastage of resources is greatly minimized, which helps the organization to remain profitable

• Weaknesses

The firm is over dependent on tax preparation of individual and corporate clients; therefore, there is a lack of diversification in the revenue sources, which can be risky for a business in the event the major line of business fails. Although the company may want to introduce more products, it is a challenge because it has few workers. Introducing new products would demand more workers, and the company is not in a position for aggressive expansion plans. The lack of diversification by the firm may have a negative impact because some clients may find it necessary to look for companies that provide all-in-inclusive services.

Another major weakness of the firm is the introduction of computer systems that have made work easier for organizations to perform accounting related services (Johnson, 243). However, the integration of these systems requires large firms because of the large capital investment required. This is a challenge for this company because it cannot afford the large capital base required for such initiatives. The lack of information systems leads to delays in accounting works, which may make clients to think of alternatives, including the large firms that have information systems and are able to perform tasks much faster.

• Opportunities

The organization is situated in the highly populated city of New York. The city`s population is continuously increasing, which is likely to provide a larger market for the company. An increase in population means that there are more people in need of accounting and investment services provided by Albert D. Eigen. In addition, there are chances that there are more learned individuals in the city, which is likely to increase the chances of the company getting highly qualified professionals (Dringoli 97). Such a situation would be for the benefit of the company because it would be able to advance its agenda with ease. The unceasingly rising population in the city should also be a motivating factor for the Albert D. Eigen`s growth and expansion to cater for the many people needing the services provided by this institution. After all, that is the surest way it can ensure that it remains relevant in what it does.

The advancements in technology present a great expansion opportunity to the firm. Investing in an efficient and more effective information system will enable the company to improve the quality of data and increase the efficiency of the organization as a whole. There exist different types of Enterprise Resource Planning systems in the market that the organization should consider adapting to improve on its effectiveness. In this case, there is a chance that the organization will have a competitive edge in which it is easier to attract new clients and maintain the old ones. The advancements in technology may also be used to increase the popularity of the company through advertising. Such a strategy can allow the organization to attract many new clients, which may help it to remain afloat despite the high competition.

• Threats

The first major threat facing the company is the presence of other industry players with more resources and work force. These organizations have the ability to handle ten times more work in using less time, which can easily put the company out of business. Competing with an organization with more assets and professionals that are more qualified is a challenge for this company. A firm with more resources is considered to have more capability of handling the services required by clients, which is the reason most people go to such companies and alienate the small ones like Albert D. Eigen (Johnson 223). To compete with organizations with more resources will require that the company to invest in modern efficient information systems, which are costly and unaffordable by this company now.

The organization does not have enough resources to purchase and apply an efficient Enterprise Resource Planning System (ERP) that may be used to handle more data efficiently. An ERP system is business process managing software that permits a business to use a system of incorporated applications to control the business and computerize office functions related to technology, services, and human resources, thereby saving on time and resources (Frazier 188). This factor can be considered as the major cause for the slow growth of the Albert D. Eigen organization. This situation is risky for this company because it can easily remain uncompetitive, which can drive it out of business.

The third major threat to the organization is the unforeseeable future. With minimal resources available and the slow inflow of revenue, the organizations future is uncertain. The growth of the industry has been accompanied by advancements in technology and information systems, which larger organizations are obtaining with ease and remaining competitive, unlike smaller companies like Albert D. Eigen. An organization that has not invested in these facilities may experience difficulty in growth because most clients go to those that can process their needs faster. Organizations with a large number of employees depend on intricate information systems to store and manage their data, which is one of the reasons they remain popular among most clients. The status of Albert D. Eigen now does not allow it to invest in these technologies, and since time is passing, there is a chance that competition may catch up with them before they can acquire such systems and go out of business (Dringoli 113).

• Recommendations

To guarantee the growth of the company, the management should consider investing in a current and efficient enterprise resource planning system that will enable it to better handle large amounts of data that may be generated from organizations with a large number of employees. The staff should also be trained on ways to operate the new systems before they are implemented. The organization should also consider hiring more qualified staff who have better experience in the industry that can help the firm gain more customers and revenue. Implementing an efficient enterprise resource planning system also ensures the firm`s existence since this will enable the organization to effectively compete with other key players in the industry.

To ensure the perpetuity of the organization, the management should ensure that all employees work towards the organizational goals set. In this case, all employees should have a clear understanding of the nature and direction of the business to appreciate the objectives set forth by the management. Employees are a key asset to the organization as they are the source of important ideas that help in retaining old clients and attracting new ones. Therefore, it is imperative for the management to handle the human resources of the organization efficiently to ensure maximum and quality output of services (Wylie 77).

The organization should also consider other product options or services they can offer to increase their customer base. Increasing the product or service options in the organization increases the revenue streams for the organization. Diversification is also a different method through which the company can expand. Increasing the number of products offered enables the organization to reach more clients and cater to various needs of a single client, which can play an important role in retaining clients and attracting new ones. Such strategies would be important because they can help the company to grow through the increased revenues.

• Conclusion

Albert D. Eigen is a CPA firm with 5-9 employees, albeit the small number of workers, the organization caters to many clients in the greater New York City region. Due to its size and structure, the organization has a number of strengths such as tight internal control, experienced staff, and provision of quality services. The firm has weaknesses, including its focus on two business products, it lacks the proper information systems and information system management skills, and some employees may not be strictly oriented towards the company`s goals. There also exist threats such as competition from other larger firms and lack of resources to expand or acquire the best information systems. There are opportunities through which the establishment can increase its client base and revenues. The organization can mitigate the threats and take advantage of the opportunities by investing in efficient and effective information systems, diversifying their product range and offers and finally ensuring that all employee duties are goal oriented. The increase in population in the region the company is located and the advancement in technology offers Albert D. Eigen the chance to grow and remain competitive. However, the management has to take the bold step of initiating the changes required in the company to enhance growth. In addition, the leaders at Albert D. Eigen have to come up with effective strategies they can use to take advantage of the opportunities and strengths while looking for solutions to the weaknesses and possible threats.