Kane Polakoff: Scaling CAS with People, Process, and Platforms

In this episode, KC Brothers interviews Kane Polikoff, a seasoned expert in accounting services, discussing his extensive career journey and the evolution of Business Process Outsourcing (BPO) to Client Accounting Services (CAS). Kane shares insights on overcoming imposter syndrome, the importance of integrating technology in accounting, and the critical role of people and culture in delivering exceptional client service. He illustrates these concepts with a compelling client success story from the restaurant industry, emphasizing the need for collaboration and innovation in modern accounting practices.

Takeaways

• Kane Polikoff has over 30 years of experience in accounting services.
• Business Process Outsourcing (BPO) has evolved into Client Accounting Services (CAS).
• CAS is focused on providing value through technology and analytics.
• Imposter syndrome is common among those entering CAS, but overcoming it is essential.
• CAS is the fastest growing line of business in accounting.
• Successful CAS requires a mix of accounting and technology skills.
• Client relationships are built on trust and collaboration.
• Work-life balance is crucial for employee satisfaction in accounting.
• Integrating systems is key to providing timely and accurate financial information.
• People and culture are the foundation of successful CAS operations.

If you would like to connect with Kane you can find his LinkedIn here: https://www.linkedin.com/in/kanepolakoff/ 

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Transcript

KC Brothers (00:05)
Welcome

another episode of Canopy Practice Success. I am your host, KC Brothers, and I am here with Kane Polikoff, who has 30 years now of experience developing and counting, yes, developing and implementing strategic services and solutions to help businesses drive operational growth and value. He was in CAS before it was even called CAS.

Kane D Polakoff (00:15)
and counting.

KC Brothers (00:29)
So we are excited to dive in with Kane. Welcome Kane.

Kane D Polakoff (00:32)
Yeah, thank you. It's a pleasure to be here. I appreciate it.

KC Brothers (00:35)
Yeah, I'd love for you to walk the listeners through maybe just a little bit of your resume strategically in the sense that like you have such an interesting path, especially because you're at such a large organization. And you have values and worldviews that I feel like differ so much from what people attribute to.

large organizations where you're at. if you'll kind of give us a little history of where you've been at and maybe even tease why I said that you've been in CAS before it was called CAS.

Kane D Polakoff (01:08)
Okay.

Yeah, so I, it's funny as a young kid, I do remember being in Chicago back in the day. And it's funny, I bring Chicago as my daughter starts her career. were talking about that a little bit on Monday in advisory for a large public accounting firm. you know, started my career in consulting. interesting in the late 90s, we all heard about Y2K, at least most of the audience has.

And during that time, there was a big push for globalization. And that was really the big push because everybody was worried that once year 2000 hit that the world would end. So we started at that time, you're looking for global operations to be able to take on and supporting our clients to make sure that all the systems and technology in the banks all work. early on in my career, had a

was able to work with countries, with individuals in China and India and the Philippines in the late 90s, which is relatively new. with my consulting, met my wife in Chicago, moved to Michigan and found a great opportunity then to get into what we call at the time was business process outsourcing. And one of the organizations I worked on early in the 2000s was

was ironically came from RSM and Glattery. It was a carve out, which the carve out was CAS. It wasn't called CAS and nobody knew what that meant, but it was doing work for clients and providing accounting services and technology to support clients. And so that was my first intro into getting into business process outsourcing. And we had a global operations, we focused on clients to

It was mainly in the hospitality space where we were providing multi-financial statements, doing reconciliations, advising clients. And then kind of fast forward ironically, then now I'm back in public accounting where I was outside of that. this is my, I'll say my second tour duty and had success building one practice from scratch and now very, very fortunate to be at Cohen Resnick and in the last two and a half years of our venture.

KC Brothers (03:05)
you

Kane D Polakoff (03:15)
It has been fantastic. It's not easy, but it's been a lot of fun. We've been able to find a great group of people working hard together, kind of driving, and we've done some pretty amazing things in a short period of time. Happy to share that as we continue to talk today.

KC Brothers (03:29)
Yeah, so where do you feel like BPO business process outsourcing, there we go, failed? where's the big delta between that and current day CAS?

Kane D Polakoff (03:42)
Yeah, so business process outsourcing is very similar to CAS in a couple of ways. And then I'll talk about the differences where BPO is more focused at only the transactional levels. So doing the low end work, making sure a lot of data entry work early on in early 2000s, we had huge rooms of data entry operators just hitting the keyboards and typing and trying to take information, scanning documents.

So at that time OCR and optical character recognition and technology was just starting to get into play is how do you make things more efficient with using technology? And a lot of that was predominantly just labor arbitrage. we would have, one of my organizations, we had 5,000 folks in our Chennai operation. We had about 2,000 people in China and we had a couple thousand in the Philippines.

is because it was all manual data entries. So it's almost a pure, pure labor arbitrage play. And then when you look at where CAS is today, which there's the difference is it's a combination. I like to say people, process, and technology. technology has evolved so much in the last, especially in the last five, 10 years when you think about when I first started my career.

Organizations would pay millions of dollars for ERP systems and doing all that. And these were big companies, but now you could do it for hundreds of thousands or thousands of dollars. You have some great general ledger systems out there, AP automation tools, closed management tools, CRM. You talk about it and that is the backbone. I like to say you could do more of less. we have a great team here in the U.S. We have a global team.

but works together to help us scale with a very standard process and control, so operation and duties to execute that. it's kind of taking everything together. Where BPO is purely just a labor arbitrage play. Yes, cost savings is something that our clients do want to have, but the value of being able to tell stories with the information and make recommendations and advise and help them determine where they're going to take their organizations, that's where CAS is evolving.

KC Brothers (05:34)
next.

Kane D Polakoff (05:43)
we're really moving to the next level, which we see a CAS 2.0 is a term that we call it. But yeah, it's been a great journey. even now, every month things are changing. So things are very fast. There's a lot of new organizations that are coming into the mix on the technology side. And there's just a tremendous demand for what we do in the industry, which I'm proud to be part of that journey.

KC Brothers (06:04)
Yeah, I can imagine.

I do feel like there's maybe still a little bit of, when people want to get into CAS, that they maybe do start out with BPO type behaviors or services or outputs, right? And I've heard a lot about people talking about,

⁓ imposter syndrome, especially when it comes to offering CAS and how can I get into the position where I'm comfortable offering advice? What would you say to those people to help cross that chasm and make the leap into or what things are they not thinking about that would help them gain the expertise they want or is this kind of a, don't listen to your inner critic and just...

get on with it and start practicing. What would you say?

Kane D Polakoff (06:47)
Sure,

well, and I think it's interesting you say that because when people were thinking about CAS before, was called write-up work or bookkeeping. Bookkeeping is a fine term to use, but it was just a necessity to create tax returns. It's after-the-fact kind of work, which you're not really driving and partnering with your clients and become an extension of their team and doing that.

And so it was always seen as if some of the poor performers in organizations would be moved into that group and they would do that work, maybe if you're not doing really well in tax or assurance, we're gonna move you into this group and you just do this one task. And CAS is sexy, I use that terminology. mean, there's the new technology, getting into analytics, getting into AI and to be able to...

partner with CFOs and CEOs and meeting with them. And it's interesting where when I started my career, people were reporting, there were different types of individuals that were joining organizations to do what we did. Now we're seeing some of the top, very intelligent people joining and we need that type of analytics and listening and to be able to think on your feet and be able to have great people skills and to be an extrovert to a certain extent.

So those are all things that are required to be successful if you want to be part of a CAS practice and you want to grow and you want to take on more leadership roles. And I think that as we build that awareness in the industry still, CAS is still, you hear about it, but a of people don't know what it is. Everybody knows what tax and insurance is. But my hope is that as we continue to advocate and bring awareness and

And now we're starting to do internship programs and go to the colleges and say, when you're trying to bring accountants out of a college to make them aware there's another path to. Not everybody's going to be or wants to be in audit, which audit is great, or tax. But there's another opportunity for young professionals to get into and really have a good career. I think that when you look at statistics, you're seeing

CAS is the fastest growing line of business and the AICPA, well, you can go look at the numbers of growth. I mean, we saw 60 % growth top line last year and it continues to be the case because there's just such demand, but you have to have the right people that are able to support that type of work. So scaling the right way and building the right infrastructure, making sure you have all the ingredients to support our clients is critical right now. And you have to bring in top talent to make that happen.

KC Brothers (09:14)
Yeah.

Well, really

quick, just had this thought of I'm a very visual learner and I know we can't necessarily do visuals here, but a good way I think to accomplish the same thing is just through story. Do you have a client story that you can share something a little bit more tangible for people to understand, okay, this is how I can take my set of skills.

And this is what the ideal is. This is what I should be shooting for when it comes to a client journey for a CAS offering.

Kane D Polakoff (09:46)
Sure, well I'll give an example of a client and how we and what type of skills are required to support that. And so I'll use a restaurant client, for example. we have a client that was before our client that was using outdated general ledger system. They didn't really have AP automation. The financial statements were not being delivered timely.

The integration to the restaurant's point of sale systems was all done manually. There wasn't a way to integrate the data that comes from a point of sale. Like if you go into a McDonald's or any different restaurants, there's the point of sale that has all the information that comes in to be able to extract that. in this situation, this restaurant needed to have that information to be able to determine

to look at their food costs, their labor costs, their paper goods, and things like that. So we had to go and determine, and the team needed to determine is, what system are we going to put this client on? And how are we going to integrate all the different systems that are currently not integrated within their ecosystem to be able to get closer to real-time information?

And then how are we going to take that information and deliver financials and other information in a timely way? So we had to understand the as is process and the process was set up the way it was for good or bad. And to be able to build a new general ledger system out of all the information that this restaurant needed and also this franchise or needed in order to see the profitability and the success of where it wants to go.

took a couple of months to get all that information. We had to work with a different point of sale. This client actually had three different point of sale systems set up. So we had to find a way to extract it. And they were some acquisitions. they were different. And they were moving then to one point of sale system. So we had to determine the data of how the data would be ingested into our new system. And then we set up an AP automation tool to be able to track and monitor and extract the AP automation.

KC Brothers (11:29)
one per location or something.

in that sense, too, the client came to you with a problem. To your point of, I know I need this solved, but did they see really what you could do for them? And that's where feel like CAS is.

Kane D Polakoff (11:53)
that's right

KC Brothers (12:03)
But then there's a certain sales approach you have to have too to say, hey, you came to me for this, but what I can do is this. And can you sell them on that? Or I just don't know how often clients are coming to an accountant asking for the high price. ⁓

Kane D Polakoff (12:16)
Yeah, and that's part of the

dating process, I'll say, right? The sale process is to be able to demonstrate the knowledge and the understanding of the business, but also talking about what potentially can be done. And then as we are going through that journey to do the research and providing business cases of what can be done and show use cases specifically of how that would happen and what that end result would be.

KC Brothers (12:20)
the dating press.

Kane D Polakoff (12:42)
So to your original question, the type of individuals that would have to create that is pretty dynamic. And you've got data integrity, you've got integration of different systems, you've got creating new reports. You're putting the engine into the car now and putting a new engine into the car and putting new paint on the outside. you're building something.

Not from scratch, there's a foundation there, but you're kind of putting together what that solution will become. And ultimately, the solution will drive execution of financial statements, other reports, and financial health of an organization. So that was kind of the end result, but as you can think, the journey to get to that point is very complicated.

KC Brothers (13:23)
Yeah, so I know we haven't finished this story yet, but as a non-accountant, I'm hearing you say these things and I'm like, none of that so far sounds like accounting.

Kane D Polakoff (13:34)
No, it's, it's seen that. And I think that's the, the, the fun part of, of, the journey of CAS is that we do have a mix of folks. I'm almost on my team as accountants, but we have, you know, individuals that are strong in technology. have individuals that are engineers. You know, we have folks that are great at project management. Cause the other thing you got to think about, you got to manage this project. You got to, you got to go and get statuses and put together a plan of execution. got escalations, you got to do whiteboard sessions. You got to have all those discussions.

And that has to be a facilitation process to get to that point. So you have to have different skills and you got to create a cross-functional team that is able to kind of take the ball from the zero, from one of the goal lines all the to the next one. And there's a lot of, you got to go a hundred yards. It takes a while to get to that point, but you have to have the right players on the team. You to have the quarterback, you got to have the receivers using the analogy for football. And there's going to be conflicts and there'll be challenges along the way and you have to overcome them.

KC Brothers (14:30)
I love that we highlighted that because there is one aspect that I've talked about several times and I know other influencers in the space are talking about, and that's just the idea of hiring non-CPA talent, especially when it comes to operations. But this to me is like that next level. Okay. If we're looking at hiring dev type talent, like we're really getting into the highest level of CAS offering here, the most complex. So here you've...

analyzed the restaurants systems, we're working on making sure that they're speaking together so that we can have data all in the right places. Now you've got data, you can figure out what's going on in the business, then where do you go?

Kane D Polakoff (15:09)
Yeah, so once you get that foundation and you understand the as-is process and it comes down to people, process, and technology is you execute that. You create the new system and the integrated solution offering, and then you have a team of individuals. Now, the other thing that we have is we have experience in different verticals. So in this case is we have individuals that have restaurant experience. Or if you're doing a non-for-profit, they have a non-for-profit experience or a real estate experience.

It's having the accounting background is important, but also having the knowledge and the nomenclature of that specific vertical, or even in some cases, hey, if you're doing a bunch of McDonald's, you want to have some folks that have an understanding of McDonald's or Burger King or Chick-fil-A or whoever that may be. And so that's helping to understand what are the key performance indicators, what is the definition of success. And as we walk through with the franchisor and the franchisee,

We're looking through different levels of the P &L and how everything flows. And then we're able to kind of determine what steps need to be done as we partner with our clients to get to where we want to be. And so that's the execution is the ongoing cadence, the daily weekly work that's required to create this outcome, which is a financial package, but it goes way beyond that's where, as we continue each of the journeys of our clients, you started at a first foundation, but the key is to continue to grow and

and to get more into taking information from a ⁓ HRS platform or a payroll system, looking at the operational information, look at the financial information. And the vision is to kind of put it all together in a very simple way to help an executive help make better decisions to drive their business, whether looking to grow or optimizing their bottom line or to make an acquisition.

We want to be there to help support them and give them the information so they can make the best decision that they can.

KC Brothers (16:56)
Yeah, and that is the top tier of CAS to me.

you need all of those things. Those are foundational elements. You need to make sure that your systems are speaking together, that the data is flowing in a way that it's accessible, that you've got the data integrity, like you've said.

and that's why I love...

Accounting just has so many opportunities in that regard and whenever I hear someone talk about that fear, that hesitancy, I want to just insert them with an extra dose of confidence because they have, for the most part, all of the tools and information they need. And it does help that they specialize. Not everyone's working for a large organization like Konrad's Nick.

Let's say that they're more a boutique firm the same size as a single team in Conrad's think, right? But the idea is the same. Is that by being able to focus on an industry, you are then able to see industry-wide trends more or less as you're managing the data and operations across several clients in that industry. And then therefore become the expert to then say, here's where

industry benchmarks are or whatever. And here's how we can tweak these aspects of your business, your spending, your payments, your operations,

Kane D Polakoff (18:10)
Yeah, I mean, you're an extension of our clients. team, are, I like to, and I was speaking at another engagement. I love to be in a position that every one of our clients invites us to Thanksgiving dinner. I mean, that's, I mean, you think about it, but if you're getting to that kind of comfort, and I've had folks that have been, that kind of tells you how integrated and how important you are to an organization. we're at sale.

KC Brothers (18:11)
Excel.

Well,

people, I'm not surprised by that because I don't know how many of your clients are entrepreneurs where it's their baby. But that's why they have such an attachment to someone like you or their accountant in general is because you've helped their baby grow. And it's just, that is so sweet. That's gotta be, yeah.

Kane D Polakoff (18:52)
No, no, it's great. It's great.

That's the best part. mean, when we get hugs or thank you and that's what our, I mean, we're in the service business. We want to support our clients and it may not even be with regards to accounting. There are a lot of different challenges and situations that we get into and we make referrals out or we try to solve them or give them individuals that can, but we want to be, I mean, everybody says the trusted advisor, but we want, as they're looking for challenges, we want them to come to us and

KC Brothers (18:57)
No.

Kane D Polakoff (19:21)
help so we can help solve it together. I think is the key there.

KC Brothers (19:25)
Yeah. A common thread again that I see here with any accountant that I talk to is just their love of serving, of helping an individual, a business to succeed. I recently came across some content that I feel like is up your alley. This professor at

Harvard, his name's Arthur C. Brooks, has defined happiness as enjoyment, satisfaction, and meaning. And I feel like you've hit a lot on meaning here within being able to serve and provide the insights, the advice, the path forward for these businesses. And to me too, that starts to break down the negative stereotypes that the industry has had for so long.

And that's why I love talking about CAS too, is because it's pulling us out from that mentality of just work grind and maybe even a badge of honor for being in the office for 80 hours and more towards the, let's do what we can to not only optimize things for us, but particularly optimizing things for our client and then finding that meaning in our work life.

Kane D Polakoff (20:33)
Yeah, no, I mean, I think that there's three words that are important in my book. It's people, culture, and people. So, I I think that, I mean, I love what I do, know, happiness and culture and focus and meaning and purpose. We talked a little bit about that earlier, but I think that we want to have a good work-life balance. I want individuals to grow and take on new skills and feel good about

how they support their clients. And I think that's critical. mean, if we don't have the right people or the people with the great attitudes that want to take care of their clients, and it doesn't matter how great your technology is or AI or your processes, but at the end of the day, it comes down to the people that are doing the work and meeting with the clients and building those relationships. And so I spend most of my time working with the people and finding the right people.

and that people want to grow and learn, but I don't want them working 80 hours a week or 100 hours a week. And that's why we have a global operation so that we, even in holidays, I want the team here in the US that's able to take July 4th, we're off the whole week of July 4th, we're off the whole week of Thanksgiving. And when that happens, our global operation steps in and does more of work. And then I want our global operations to take off their holidays too, just as an example.

And early on in my career, sometimes I wasn't even able to take holidays off. And I think it's important for everybody to find that good work-life balance and be comfortable and happy and be challenged to help drive success for themselves too.

KC Brothers (22:00)
I love it. thank you so much, Kane. You are a breath of fresh air for the industry, and I know that you speak a lot. Everybody look up Kane on LinkedIn. I know you are also recently named one of the top 100 most influential people by accounting today. I couldn't appreciate you more, Kane. Thank you again.

Kane D Polakoff (22:05)
No, thank you.

Yeah,

thanks for the opportunity to talk today.